King v. Farmers' Grain Co. of Dawson
| Decision Date | 23 June 1922 |
| Docket Number | No. 34306.,34306. |
| Citation | 194 Iowa 979,188 N.W. 720 |
| Parties | KING v. FARMERS' GRAIN CO. OF DAWSON. |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Dallas County; H. S. Dugan, Judge.
Action at law to recover damages for the breach of an alleged oral contract, for the sale of corn. Verdict of the jury and judgment for plaintiff. The defendant appeals. Reversed.
Preston, J., dissenting.Harry Wifvat and Wm. H. Winegar, both of Perry, for appellant.
George J. Dugan, of Perry, and White & Clarke, of Adel, for appellee.
The plaintiff alleged in his petition that on or about June 15, 1920, he entered into an oral contract with the defendant for the sale of 6,500 bushels of corn, and that some time later the defendant's agent paid him $100 on the contract. The defendant, after admitting that it is a corporation, denied the allegations of plaintiff's petition and averred that the contract sued upon is within the statute of frauds and void, and set up other and further defenses which, in view of the conclusion reached upon the other questions, it is unnecessary to state.
At the time the alleged oral contract was entered into, plaintiff owned 2,400 bushels of corn, John Shoemaker, his landlord, a like amount, and Humphrey King, his brother, about 2,000 bushels of corn. Plaintiff claims, and the evidence shows, that he was authorized by Shoemaker and his brother to sell their corn to appellant for them. The sale was made in the name of appellee without disclosing the fact that he was acting as agent for Shoemaker and his brother and that a portion of the corn belonged to him. Appellee does not claim to have purchased the corn of either principal, nor that he contemplated doing so. The sale, although made in his name, was for the separate benefit of himself, Shoemaker, and his brother. No part of the purchase price was paid at the time the contract was entered into, but about a month later appellant paid appellee $100 by check on the Dawson Savings Bank. Some claim is made by counsel for appellant that no valid contract of sale was entered into and that the evidence fails to show that the payment of $100 was intended to apply on the contract. These questions were properly submitted to the jury, which found in favor of plaintiff.
The court instructed the jury that, if plaintiff was entitled to recover at all, the measure of his recovery was the difference between the contract price of $1.75 per bushel for 6,500 bushels of corn, and the market price at which he could have sold same with reasonable effort after he was notified by defendant that it would not accept the delivery of the corn. Proper timely exception was taken to this instruction.
Plaintiff in the transaction in question acted in a dual capacity; that is, for himself and as agent for Shoemaker and his brother separately. The corn of plaintiff and Shoemaker was on the farm occupied by the former, while that owned by Chester was on another farm about one-half mile distant. The corn was owned in the quantity stated separately by the plaintiff and his principals. They had no joint interest therein. Plaintiff did not intend to engage in speculation at the time he sold the corn, nor does he claim to have had 6,500 bushels of his own for sale. Both Shoemaker and Chester King were examined as witnesses on behalf of plaintiff, and testified that they authorized plaintiff to sell their corn, and that they were ready and willing to deliver the same to appellant in fulfillment of the contract entered into by plaintiff on their behalf. It is obvious, therefore, that plaintiff did not, by any transaction with either Shoemaker or King, become the owner of the corn in their possession, nor did he engage to deliver the same for them to appellant, or in any way bind them to make such delivery. His agency, under the testimony, was limited strictly to the sale of the corn. Plaintiff was not in a position to compel either Shoemaker or his brother to deliver their corn to appellant upon the contract made by him. The market price of corn greatly declined, and, as would be quite natural, Shoemaker and King were willing to deliver their part of the corn.
[1] Subject to certain exceptions not present in this case, the agent who sells the property of his principal in his own name may maintain an action upon the contract for the benefit of his principals. Brown v. Sharkey & Ross, 93 Iowa, 157, 61 N. W. 364;Gooden v. Rayl, 85 Iowa, 592, 52 N. W. 506;Knott v. D. & S. C. Ry. Co., 84 Iowa, 462, 51 N. W. 57;Moorehead v. Hyde & Braden, 38 Iowa, 382;Wells v. Telegraph Co., 144 Iowa, 605, 123 N. W. 371, 24 L. R. A. (N. S.) 1045, 138 Am. St. Rep. 317;Smith & Son v. Bloom, 159 Iowa, 592, 141 N. W. 32; Code, § 3459.
[2] Likewise, it is ordinarily, and under the facts of this case is, true that, notwithstanding the contract may have been entered into on behalf of the principal in the name of the agent, an action may be brought thereon, or for a breach thereof by the principal in his own name. Shields v. Coyne, 148 Iowa, 313, 127 N. W. 63, 29 L. R. A. (N. S.) 472, Ann. Cas. 1912C, 905; Wells v. Telegraph Co., supra.
[3] Whether, however, the action be prosecuted in the name of the agent for the benefit of the principal, or by the principal in his own name, there can be no recovery in favor of either, if the contract is not enforceable because within the statute of frauds. It is conceded that no part of the corn was delivered or actually received by appellant, and that no note or memorandum in writing was signed by the party to be charged, or the agent thereof, and that no part of the purchase price was paid for a month after the terms of the contract were agreed upon. Subdivision 1 of section 4625 of the Code was repealed by chapter 396 of the Acts of the Thirty-Eighth General Assemly, commonly known as the “Uniform Sales Act,” and section 4, subds. 1 and 2, of said chapter, which is as follows, enacted in lieu thereof:
“Sec. 4. (1) A contract to sell or a sale of any goods or choses in action shall not be enforceable by action unless the buyer shall accept part of the goods or choses in action so contracted to be sold or sold and actually receive the same or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract or sale be signed by the party to be charged or his agent in that behalf.
(2) The provisions of this section apply to every such contract or sale, notwithstanding that the goods may be intended to be delivered at some future time or may not at the time of such contract of sale be actually made, procured, or provided, or fit or ready for delivery, or some act may be requisite for the making or completing thereof, or rendering the same fit for delivery; but if the goods are to be manufactured by the seller especially for the buyer and are not suitable for sale to others in the ordinary course of the seller's business, the provisions of this section shall not apply.”
Concerning the $100 payment which was made by check payable to plaintiff upon the Dawson Savings Bank, the evidence on behalf of plaintiff showed that he, in company with his brother, went to the office of appellant and requested an advance payment on the contract. Appellant's agent at first declined this request. Plaintiff thereupon informed the agent that he was hard up; that he had some men working for him who wanted their wages paid; that he needed some money, and asked for a payment of $100. Appellant's agent then gave him the check for $100. This payment is the sole reliance of appellee to take the case out of the statute of frauds. Plaintiff did not at the time of making the contract disclose that he was acting as the agent of Shoemaker and King in the sale of the larger part of the quantity agreed upon, nor was this fact known to appellant's agent at the time of the $100 payment. No claim is made by any one that any part of the $100 payment was intended either by appellant or plaintiff for the benefit of Shoemaker or Chester King. W. E. Chinn, appellant's agent, did not know that plaintiff was the agent of his landlord and brother, and the statements made by plaintiff show conclusively that he intended and treated the payment as an advancement upon the purchase price of his own corn and applied it to his own use. This took the contract out of the statute so far as he was personally concerned.
[4] The corn was owned in severalty and sold at the agreed price of $1.75 per bushel. The contract was therefore separable, and, unless unenforceable because within the statute, an independent action against appellant for damages could have been maintained by each of the parties. The statute of frauds quoted supra provided that, where no part of the property is delivered or purchase price paid, a contract for the sale of personal property is unenforceable unless a note or memorandum in writing is signed by the party to be charged or by his agent in his behalf. Had Shoemaker or Chester King commenced separate actions against appellant to recover damages for the refusal of the latter to accept their corn, would a plea of the statute of frauds have been a good defense thereto? It certainly would unless the payment made to appellee operated to take the entire transaction out of the statute. We have found no case squarely in point. The Supreme Court of Michigan, in Burnhans et al. v. Corey et al., 17 Mich. 282, is somewhat in point. In that case, the defendant purchased a quantity of wool owned jointly by three parties. The buyer paid $30 to one of the owners without directing that it be divided or prorated among the owners. The buyer refused to accept the wool and pleaded the statute of frauds as a defense to an action brought by the sellers for damages for the breach of the contract. The court held that the payment belonged ratably to the sellers and sustained the contract. It will be observed that in the Michigan case the buyer knew that...
To continue reading
Request your trial