Taylor v. St. Louis National Life Insurance Co.

• Decision Date: 21 December 1915
• Citation: 181 S.W. 8,266 Mo. 283
• Parties: GEORGE W. TAYLOR v. ST. LOUIS NATIONAL LIFE INSURANCE COMPANY, Appellant
• Court: Missouri Supreme Court

181 S.W. 8

266 Mo. 283

GEORGE W. TAYLOR v. ST. LOUIS NATIONAL LIFE INSURANCE COMPANY, Appellant

Supreme Court of Missouri, First Division

December 21, 1915

Appeal from St. Louis City Circuit Court. -- Hon. Wilson A. Taylor Judge.

Reversed.

Collins Barker & Britton, E. M. Harber and Albert L. Reeves for appellant.

(1) Defendant's demurrer to the evidence at the close of plaintiff's case should have been sustained. (a) There was no evidence of Starnes's authority to bind the defendant. A principal is responsible for the act of an agent acting with apparent authority, only where the principal has clothed the agent with the appearance of power. Taylor v Sartorious, 130 Mo.App. 34; Duffy v. Mallinkrodt, 81 Mo.App. 449. Starnes could not have bound the defendant by wrong-fully assuming to act as its president. Art. 2, chap. 61, R. S. 1909. (b) There was no evidence of Webb's authority to act as agent for the Missouri-Lincoln Trust Company in the purchase of the stock. Taylor v. Sartorious, 130 Mo.App. 24; Lyons v. Corder, 253 Mo. 551. (c) There was no sale at $ 200 per share, in compliance with the terms of plaintiff's alleged contract with Starnes. Young v. Cooperage Works, 259 Mo. 220. (d) Plaintiff was not the procuring cause of the sale actually made. (2) Defendant's peremptory instruction as the close of the whole case likewise should have been sustained. (3) While the appellate court will not disturb the verdict of the jury upon a question of the weight of evidence, it will not hesitate to do so where the verdict is not supported by the evidence. Lyons v. Corder, 253 Mo. 561; Graney v. Railroad, 157 Mo. 678; Powell v. Railroad, 76 Mo. 84; McFarland v. Accident Assn., 124 Mo. 222; O'Donnell v. Railroad, 152 Mo.App. 614; Fitzjohn v. Transit Co., 183 Mo. 78; Knisely v. Leathe, 178 S.W. 461; College v. Dockery, 241 Mo. 522. (4) The judgment of the lower court should be reversed without remanding. Knisely v. Leathe, 178 S.W. 461; College v. Dockery, 241 Mo. 522.

Marion C. Early for respondent.

(1) The petition alleged that defendant was a corporation duly organized, and this allegation not being denied under oath, it is admitted. Under the pleadings and the evidence it was a corporation de jure at all times from and after the date of plaintiff's contract. (2) The defendant held itself out as a corporation; it allowed Starnes to advertise himself as its president; it allowed him to act for it in the sale of a portion of its stock; it accepted the results of the contracts made by him and under the facts disclosed it is, as to third persons dealing with it in good faith, a corporation de facto in any event and it is liable to third persons for its acts. Camp v. Byrne, 41 Mo. 525; Knapp v. Joy, 9 Mo.App. 575; Brown v. Scottish American Mortg. Co., 110 Ill. 235; Montgomery v. Hurst, 9 Ala. 513; Douglas County v. Bolles, 94 U.S. 104; Bank v. Trust Co., 187 Mo. 494; Wescott v. Guarantee Ins. Co., 63 Mo.App. 366; Famous Ins. Co. v. Medles, 52 Mo. 17; National Ins. Co. v. Bowman, 60 Mo. 252; Ragan v. McElroy, 98 Mo. 349; Studebaker Bros. Mfg. Co. v. Montgomery, 74 Mo. 101. (3) It is well settled that when an officer of a corporation is allowed to exercise a particular authority publicly, in other words, if he is in effect held out to the world as having authority in the premises, the corporation is bound by his acts in the same manner as if the authority were expressly granted, in which case it is not necessary in order to charge the corporation to prove special authorization. Fayles v. Ins. Co., 49 Mo. 380; Slothard v. Aull, 7 Mo. 318; Lungstrass v. Ins. Co., 57 Mo. 107; Ceeder v. Lumber Co., 86 Mich. 541; Ferry Co. v. Sidell, 66 F. 27, 13 C. C. A. 308; Thompson on Corp., secs. 4876-4882; Chenoweth v. Express Co., 93 Mo.App. 199; Moon v. Mfg. Co., 113 Mo. 98; Rosenbaum v. Gilliam, 101 Mo.App. 126; Tyler Estate v. Hoffman, 146 Mo.App. 522. (4) Even if Starnes had no authority to enter into a contract with plaintiff the defendant is estopped to deny its liability because it acquiesced in Starnes's act by accepting and retaining the fruits thereof. Ferguson v. Trans. Co., 79 Mo.App. 352; Glass v. Brewing Co., 47 Mo.App. 641; Drug Co. v. Robinson, 81 Mo. 26; Railroad v. Vamedoe, 81 Ga. 175. (5) The defendant recognized the authority of Starnes to bind it by the contract with plaintiff by part payment to plaintiff for services rendered under the contract. The evidence shows defendant's contract to pay plaintiff a stated sum was the usual amount it was paying for such services. Fayles v. Insurance Co., 49 Mo. 380; Stohard v. Aull, 7 Mo. 318; Bank v. Bank, 107 Mo. 145. (6) The fact that defendant on its own motion may have made a contract whereby in the end it may have received a less consideration than it authorized plaintiff to offer, does not deprive plaintiff of his right to a commission on the amount realized. If in the opinion of the court the verdict is excessive the court is empowered to order a remittitur. Nichols v. Whitacre, 112 Mo.App. 692; Grether v. McCommack, 79 Mo.App. 325; Glade v. Mining Co., 129 Mo.App. 455; Smith v. Salt Co., 177 S.W. 1057.

OPINION

GRAVES, P. J.

This is an action to recover commission for the sale of stock of the Universal Insurance Company, later by authorized change of name the present defendant, St. Louis National Life Insurance Company. Plaintiff sues upon an express contract to sell such stock at $ 200 per share of $ 100 par value, and to receive for such service the sum of ten per cent of the amount of stock so sold. He then avers he was the procuring cause of the said defendant having sold $ 75,000, in par value, or 750 shares, at the price and sum of $ 200 per share, and asks judgment for $ 15,000 and interest, less a payment of $ 200 which he avers to have been made.

The action is one clearly upon contract and not upon quantum meruit.

By the petition it would seem that there had been a settlement with plaintiff for $ 200, but this he avers to have been procured and induced by fraudulent statements, and it is for this $ 200 that he gives credit on the claimed commission of $ 15,000.

The answer was a general denial. From a verdict and judgment of $ 19,405.50, the defendant has appealed. Further facts will be stated in the course of the opinion under the points involved.

I. The first point urged by the defendant, is that the plaintiff had no valid contract with the defendant, and in as much as his own proof shows such fact, the demurrer to the testimony interposed by the defendant should have been sustained.

It is clear from all the evidence in this case that the organization of the Universal Life Insurance Company was not completed at the time plaintiff says that he contracted with it through P. M. Starnes. It could not have been completed until after the stock had been fully subscribed. It was not fully subscribed at the time of plaintiff's alleged employment. He testifies that he was introduced to P. M. Starnes as the president of the company, and that the sign at the office door was, "Universal Life Insurance Company; P. M. Starnes, President." In this discussion we are granting it to be true that P. M. Starnes actually made the contract with plaintiff, as such contract is pleaded in his petition. Under all the evidence it was made with Starnes, or not at all. Defendant's testimony is to the effect that Starnes, prior to the subscription for all the stock, was merely a member of the organizing committee. The evidence is undisputed that at the time of the alleged employment of plaintiff to get subscribers to stock, only one-half of the proposed capital stock of the corporation had been subscribed. The proposed capital stock was 1500 shares of the par value of $ 100 each, but subscribers were taken on the basis of $ 200 per share, so as to create a surplus equal to the capital stock. Plaintiff's claim is that he induced the Missouri-Lincoln Trust Company and Mr. Webb to take the last half of the 1500 shares, or 750 shares at $ 200 each. This is the basis of his action. It shows upon its face that the insurance company was not then organized, because it could not have been organized. It shows upon its face that Starnes was not president, because he could not have been president at that time, i. e., prior to the completed organization. The records are plain in this case, and even the way-farer cannot go far astray. On July 10, 1907, the following records appear:

11:30 a. m. July 10, 1907.

The committee met in full at 11:30 a. m. Messrs. Blanke, Rassfeld, Goerts and James present, and called to order by Chairman Blanke.

Proposition was presented by Rassfeld and read by him from Barten in Litchfield, Ill., for completion of organization. On motion by Rassfeld and seconded by Blanke, this proposition was rejected.

Proposition submitted by the Mississippi Valley Life Ins. organization committee was on motion tabled for future consideration.

Proposition from P. M. Starnes not being completed, on motion committee adjourned to meet at 5:30 p. m. July 10, 1907.

Otto H. Rassfeld, Secy.

5:30 p. m. July 10, 1907.

Committee meeting called to order, Messrs. Blanke, Rassfeld, James and Goerts being present, by Chairman Blanke.

Proposition of P. M. Starnes submitted and read by Rassfeld. After careful and thorough consideration and investigation, on motion by Rassfeld, seconded by James, the committee voted to accept same.

On motion of James, seconded by Blanke, P. M. Starnes was elected a member of the committee, and chosen as chairman.

On motion, committee adjourned to meet at call.

Otto H. Rassfeld, Secy.

These entries show that Starnes first became connected with the organization committee, not the corporation, on July 10, 1907.

On July 20th, after the stock deal with the ...