Tennessee Gas & Transmission Co. v. Cooke
| Decision Date | 05 December 1947 |
| Citation | 306 Ky. 160 |
| Parties | Tennessee Gas & Transmission Co. v. Cooke et al. |
| Court | United States State Supreme Court — District of Kentucky |
3. Principal and Agent. — A principal is bound by the acts of the agent within apparent scope of authority, though authority may be in fact limited, if one dealing with the agent is ignorant of the limitations on his authority.
4. Principal and Agent. — Where one of two parties must suffer loss through acts of an agent, the loss should fall on the one who authorized agent to act rather than on innocent third party, unless agent is acting beyond scope of his apparent authority.
5. Corporations. — Gas company was not relieved from liability to automobile dealers for automobile obtained from dealers by company's chief expediter because of fact that dealers issued a bill of sale in blank and expediter allegedly filled in his own name, where other trucks and automobiles which had been delivered by dealers to, accepted by, and paid for by company, had been transferred by bills of sale issued in blank at request of expediter.
6. Principal and Agent. — Where principal permits one to occupy a position of authority of a particular kind, any one dealing with one in that position is justified in inferring that he possesses such authority, unless the contrary is then made known.
7. Corporations. — Where gas company's chief expediter bought from automobile dealers 47 automobiles and trucks which were paid for by company, and some of the bills of sale for automobiles were left blank at request of expediter, and on one occasion expediter allegedly retained an automobile and filled in his name on the bill of sale and allegedly had automobile registered in his own name, and company never informed dealers that there were any limits on expediter's authority until after company refused to pay for automobile allegedly registered in expediter's name, company was liable for purchase price of that automobile on ground that expediter had apparent authority.
8. New Trial. — Where defendant knew at time it filed its answer that its former agent who was a material witness, possessed detailed knowledge of all material facts involved, though it may not have known the facts in entirety, and when case was called for trial defendant made no motion for continuance because of absence of agent, defendant was not entitled to new trial on ground of newly discovered evidence after locating agent.
Appeal from Jefferson Circuit Court.
Davis, Boehl, Viser & Marcus and Doolan, Helm, Stites & Wood for appellant.
Woodward, Dawson, Hobson & Fulton and Henry D. Hopson for appellees.
Before Roscoe Conkling, Judge.
Affirming.
Appellees, as plaintiffs below, instituted this action to recover from the Tennessee Gas and Transmission Company $3,500, the purchase price of a Cadillac automobile, alleged to have been sold to appellant on or about June 1, 1944. Appellant defended alleging this automobile was never purchased by it, nor sold or delivered to it, but that appellees made a sale of the automobile to Marshall F. Lerch, a former employee of appellant.
At the conclusion of all the testimony the trial court directed a verdict in favor of appellees. Promptly and within the required time appellant filed motion and grounds for new trial. This was followed by supplemental motion supported by affidavits for new trial on grounds of newly discovered evidence. This motion was overruled. The Tennessee Gas and Transmission Company is here insisting error in directing a verdict against it and in overruling its motion for a new trial, and is urging reversal of the judgment with directions upon the next trial to direct a verdict in its favor.
The chief problems center around, first, the fact as to whether or not Lerch had authority to purchase the Cadillac, and, second, as to whether or not the court erred in refusing to grant a new trial on grounds of newly discovered evidence.
Appellant insists that the evidence undisputably shows Lerch had no actual authority, and if appellees recover it must be based upon Lerch's apparent authority. Appellant insists that it was incumbent upon appellees to show that they believed, and were justified in believing, that Lerch had authority to purchase the Cadillac.
This leads us then to the facts of the case. The testimony of 4 witnesses completed the evidence, three for appellees and one for appellant. It was established by appellees that late in the Fall of 1943 appellees had a long distance call from Marshall Lerch of the Tennessee Gas and Transmission Company, in which inquiry was made if the Cookes would sell some cars to the Tennessee Gas and Transmission Company which was constructing a pipeline from Texas to the East. The importance of such sale was impressed upon appellees in that the project was highly important during the war time emergency. Investigation was made of the financial situation of appellant, and feeling it a patriotic duty to supply automobiles for such a project during the war time emergency, appellees arranged for sale and delivery of cars. The first lot sold consisted of 12 or 13 cars which the Cookes were to deliver to the Company in Houston, Texas, but difficulty over the gas coupons caused stoppage in the delivery of the cars at Memphis, Tennessee, at which place the cars were turned over to the Company. Appellant paid for this lot of cars. After this first delivery, Lerch bought cars and trucks, 47 in all, which were paid for by the Tennessee Gas and Transmission Company. In fact all the cars purchased by Lerch, except the Cadillac, were paid for. It was established also that generally the cars were delivered on the same day they were sold to Lerch and that purchase orders for the cars were not sent in by the Gas Company many times until long after delivery had been accepted. At the time of the particular purchase wherein the Cadillac was bought, the testimony was that Lerch came into Cooke's office and bought some 8 or 10 trucks and stated that he wished to purchase an additional two Cadillacs which the appellee company at that time had on hand. Before a deal for the purchase could be made, the Cookes sold one of the Cadillacs to someone else, but agreed to and did sell and deliver, the other one to Lerch, or through him to the appellant company. Lerch told appellees that he wanted the Cadillac for one of the officials of the appellant company and asked Cooke to leave the name blank on the Bill of Sale, stating that he was not certain whether he would want it licensed in the name of the Company or in the official's name, and that there was some doubt as to which official of the Company would be the one to use it. The car was billed to the Company and Cooke gave Lerch the invoice just as he had done on every one of the other cars sold. It was testified that this request by Lerch to leave the name blank was not unusual as they had handled some other transactions with him in the same way. The Bill of Sale, as introduced at the trial, was in the name of Marshall F. Lerch. One of the Mr. Cookes testified, however, that his office did not put Lerch's name on the Bill of Sale, nor did they know that he was going to do this after he left with the car. After delay in payment for the Cadillac, Mr. Cooke called the office of the appellant company at Houston, and also went to the Company home office to see Mr. Miller, the Executive Vice President, who informed Cooke that Lerch was no longer with the Company, and intimated to Cooke that Lerch had pulled other deals similar to this. It appears that Miller advised Cooke that he should make an attempt to repossess the car, which Cooke refused to do.
Cooke admitted on cross-examination that all he knew about Lerch's connection with the Tennessee Gas and Transmission Company was what Lerch told him; that Lerch did not present any writing from any official of the Gas Company authorizing him to buy automobiles, nor did any one connected with the Company ever tell him that Lerch was authorized to buy a car. Cooke testified that at...
To continue reading
Request your trial