Smith v. Watson, Sumner & Co
| Decision Date | 06 December 1886 |
| Citation | 1 S.E. 96,82 Va. 712 |
| Parties | Smith v. Watson, Sumner & Co |
| Court | Virginia Supreme Court |
Decree affirmed.
Error to judgment of circuit court of city of Richmond, rendered December 8th, 1884, in an action of assumpsit, in which Watson, Sumner & Co. are plaintiffs, and James C Smith, doing business in the name of the "Old Dominion Paper Mills," is defendant. Verdict and judgment for plaintiffs. Defendant having excepted to several rulings of the court, the evidence was certified, and he obtained a writ of error and supersedeas.
Opinion states the case.
Meredith & Cocke, for plaintiff in error.
Coke & Pickerell, for defendants in error.
Absent, Lewis, P., and Hinton, J.
OPINION
The material facts, disclosed by the record, are that the appellant, Smith, began, in 1882, to manufacture paper in Richmond, Va., under the firm and style of "Old Dominion Paper Mills"; and continued so to do until September 1st, 1883; at which date, having found it an unprofitable business, and the condition of his money matters requiring him to close the enterprise, he leased the mills to one Henry Kramer, who, from the time Smith started the said mills until he closed them, had been manager of the same for him. On September 1st, 1883, the said J. C. Smith advertised in the "State" newspaper that he had leased the mills to Kramer, who was to have all the stock and pay all debts -- the outstanding liabilities of the concern; to the foot of which advertisement, Kramer added the following:
For eighteen months or two years prior to September 1st, 1883, the "Old Dominion Paper Mills," Henry Kramer, Manager, under the proprietorship of J. C. Smith, dealt continuously with the appellees, Watson, Sumner & Co., who were dealers in paper manufacturers' supplies, in the city of New York; and who (as the record shows), had cautiously investigated, and fully assured themselves of J. C. Smith's commercial credit. Henry Kramer, whom they knew only as manager of the "Old Dominion Paper Mills," for Smith, proprietor, was without capital or means, except the salary received from Smith, as said manager, and as also clerk in his junk store.
The letters of the Old Dominion Paper Mills to Watson, Summer & Co., are set out, in extenso, in the record, and they show conclusively that they were all written by Henry Kramer, and that, as manager of the Old Dominion Paper Mills, he had unlimited authority over the business in all its details; he wrote all the letters and orders for goods, and signed them "Old Dominion Paper Mills, Henry Kramer, manager." Smith never interfered. In addition to this exclusive conduct of the business with Watson, Sumner & Co., by written orders for goods and the transmission of payments therefor, Kramer had frequently visited that firm in New York city and purchased goods and supplies from them in person, as manager for Smith, as proprietor of the Old Dominion Paper Mills.
On the 29th day of August, 1883, Henry Kramer, who had gone to New York, called, as he had frequently done before, and purchased from Watson, Sumner & Co., for Smith, fifty-one bales of gunny bagging, for the price of $ 590.56, the consideration of the note sued on. At the time of this sale Smith was admittedly, proprietor of the mills, and Henry Kramer was his manager, with full power and authority to purchase goods for the mills and to bind Smith for such purchases. Watson, Sumner & Co. knew his authority; and they sold the bagging to him, as manager for Smith, as they had frequently done before. He had written to Watson. Sumner & Co. before going North, that he would call to see them on business for Smith. Kramer said nothing to them of his contemplated lease of the mills after September 1st, and that he was buying for himself. They knew Kramer to be wholly without means, and would not have credited him for such an amount. The letters of Kramer to Watson, Sumner & Co., before his visit, heralding the coming of "Our Mr. Kramer," made no mention of, or reference to, the contemplated change in the Old Dominion Paper Mills, and they were all written upon paper with letter-heads printed upon them in large capitals, "James C. Smith, proprietor," and his letters subsequent to his visit, and return to Richmond, preserve the same silence, until the gunny bagging had been shipped and passed beyond the control of Watson, Sumner & Co., who shipped the said bagging on the 5th and 6th of September to the Old Dominion Paper Mills, as usual, believing Smith to be still the proprietor, and knowing nothing to the contrary. On September 7th, after the bagging had been shipped and had passed beyond their control, they received from Kramer the circular dated September 1, 1883, announcing Smith's lease to Kramer and his withdrawal from the proprietorship of the Old Dominion Paper Mills as of that date, Kramer still using the same letter-heads with the name of James C. Smith, proprietor, printed upon them in large capitals, and signing himself "Manager," as if no lease had been made. On September 8th Watson, Sumner & Co. received the note sued on for $ 590.56. It was signed "Old Dominion Paper Mills, Henry Kramer, Manager," and it came along with another note for $ 120.42, signed in the same way; also for a purchase prior to September 1, 1883. This was the same signature that had been constantly used during the eighteen months previous, to orders upon Watson, Sumner & Co., for goods for the mills while Smith was proprietor, and it was under the same printed letter-heading. Watson, Sumner & Co. believed these notes to be the notes of the old concern, as they both represented debts upon which Smith was then bound to them; and in their letter acknowledging receipt of the said notes, they stated that they were "to balance account to the 1st September, 1883," when the new proprietorship began. They believed that Kramer had power to sign the said notes for the old concern, as he had power, as general manager, to order the goods for which they were given. The letters of Kramer prior to September 1st show that he had such power. The note for $ 590.56 was, like all the others, sent through the banks, to Richmond banks for collection, and notice thereof was served at the office of the Old Dominion Paper Mills, which was also James C. Smith's office for his other business. The said note, at maturity, was dishonored and protested for non-payment, and this suit was brought upon it. At the trial, instructions...
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