Turner v. Zip Motors

• Decision Date: 26 July 1954
• Docket Number: No. 48508,48508
• Citation: 45 A.L.R.2d 1174,245 Iowa 1091,65 N.W.2d 427
• Parties: , 45 A.L.R.2d 1174 TURNER v. ZIP MOTORS, Inc.
• Court: Iowa Supreme Court

Page 427

65 N.W.2d 427

245 Iowa 1091, 45 A.L.R.2d 1174

TURNER v. ZIP MOTORS, Inc.

No. 48508.

Supreme Court of Iowa.

July 26, 1954.

George B. Boland, of Omaha, Neb., and J. Leo Connolly, of Council Bluffs, for appellant.

Ross, Johnson, Northrop, Stuart & Tinley, of Council Bluffs, for appellee.

THOMPSON, Justice.

The instant case is an outgrowth of A. C. Nelsen Auto Sales, Inc. v. Turner, 241 Iowa 927, 44 N.W.2d 36, a replevin action in which the plaintiff, an Omaha automobile sales agency, claimed the right to possession of a Packard car from the defendant Turner, who is the plaintiff in the action now before us. Turner successfully defended the replevin suit both in the trial court and this court. He now alleges that the litigation was brought about by the wrongful conversion of the automobile, which was at all times his property, by the defendant Zip Motors, Inc., acting through its agent, one O'Brien. The trial court, sitting as judge of both the facts and the law, granted Turner a judgment for $600, which it found to be the reasonable value of the attorney fees incurred by Turner in the defense of the replevin suit, and denied him relief for any other items of damage which he asked. No question is made as to the reasonableness of the fees allowed, and Turner has not appealed from the adverse judgment refusing to allow him the other claimed damages. We have, therefore, only the question of the legality of the allowance of the attorney fees.

In this appeal, the defendant-appellant assigns four errors relied upon for reversal. The first is that the court erred in finding Frank O'Brien was a salesman, agent and employee of the defendant at the time of the transaction which brought about the litigation with the Nelsen Auto Sales; the second, that the court was in error in finding the said O'Brien was acting within the apparent scope of his authority in negotiating a purported sale of plaintiff-appellee's automobile to the Nelsen firm; and the third, that the attorney fees incurred in the Nelsen suit were not a proper item of damage and the court erred in holding they were. The fourth assignment is a general one and depends upon the correctness of the rulings on the first three. It need not be separately considered.

I. The first and second assignments will be considered together. The material facts at this point are that the plaintiff, on September 23, 1948, being desirous of selling his Packard car, drove to the place of business of the defendant in Council Bluffs. It is alleged and admitted in the pleadings that defendant was at all material times a corporation whose primary purpose was to 'buy, sell, distribute and handle, both at wholesale and retail, motor vehicles of all kinds', together with parts, accessories, gas, oils and other petroleum products, and to service, repair and recondition motor vehicles.

We of course follow the familiar rule that in law actions tried to the court without a jury, the fact findings of the court, if supported by substantial evidence, have the same effect as a jury verdict, and cannot be disturbed upon appeal. Nelsen Auto Sales v. Turner, supra, at page 930 of 241 Iowa, 44 N.W.2d 36, and cases cited. Some of the items of testimony hereafter set out were strongly disputed by the defendant; but it is not our right to weigh the evidence. Since we must follow the trial court in its supported findings of fact, it will avail nothing to discuss or even refer to the defendant's testimony which does no more than deny substantial evidence for plaintiff.

The plaintiff testified when he went to defendant's place of business on September 23rd, he talked to 'the girl at the information desk.' He told her he wanted to sell his car. She said the men were busy. He saw a man talking to other apparent customers. After a few minutes this man walked over to him, and the girl at the desk introduced him to plaintiff as O'Brien, and told him to go out and appraise plaintiff's car. Either the young woman or O'Brien at this time gave him a card, which appears in evidence as plaintiff's Exhibit 1. The card bore the name 'Zip Motors, Inc.' printed across the center. In the upper left-hand corner were the words 'Zip for Cars;' in the upper right-hand corner, 'Zip for Trucks'. In the lower left corner was the address of the company, and in the lower right its phone number. In the center below the name of the company, were the printed words 'Ask for' and immediately below these was, in writing, 'Frank O'Brien.' After plaintiff had been introduced to O'Brien and been handed this card, he and O'Brien went out to look at the automobile. O'Brien said the car would bring $3,500, but would not bring that much if it was put on the company's lot. He said he might sell it to an elderly couple in Omaha, and told plaintiff to clean it up and bring it back Saturday, the 25th.

On the morning of the 25th, at about 8:30 a. m., plaintiff again drove his car to defendant's place of business. O'Brien was in the office, and came out when he saw plaintiff. He said he would tell the people in defendant's office what he was going to do, and he and plaintiff then drove to Omaha. Here O'Brien suggested to plaintiff he wait for him while he called on his supposed prospective customers, and arranged to meet him in about an hour. O'Brien, as it later developed, took the car and sold it fraudulently to the Nelsen Auto Sales Company, and decamped with the money. He has never been located. Plaintiff, after waiting for several hours, reported his loss to the police, who found his car parked, apparently on the Nelsen sales lot or on the street near this company's place of business. They towed it to the police station, where the next day plaintiff took possession of it. This brought about the replevin suit in which the Nelsen Company tried unsuccessfully to regain possession of the automobile, and in which plaintiff incurred the attorney fees for which he was granted judgment against the defendant in the case at bar.

Mrs. Lucille Carmichael testified for plaintiff that she was employed by defendant as a bookkeeper and general office worker at the time plaintiff came to attempt to sell his car. She was also apparently the receptionist, for she says 'I talked to people as they came in.' When plaintiff came in to see about selling his automobile she referred him to O'Brien, 'first salesman on our staff.' She says 'O'Brien worked for Zip Motors a short time.' She says O'Brien was there more than three days, and the company manager, Mundell, told of firing him after this affair. She says O'Brien was there early on Saturday morning (September 25th) and told her to tell his wife he had gone to a dentist.

For defendant, Mundell, the manager, denies O'Brien was ever employed as a salesman or in any other capacity by it; and there is other evidence supporting defendant's case. But it will avail nothing to go further into detail concerning it; we think the testimony of the plaintiff and Mrs. Carmichael gives substantial support to the trial court's finding that O'Brien was at the time of the transaction referred to a salesman and agent of the defendant, and its finding must therefore be final on this question of fact. Mrs. Carmichael, the bookkeeper and information clerk or receptionist, says he was employed as a salesman at that time; and plaintiff was given a company card in which O'Brien's name had been filled in in writing so as to make it appear he was in some manner connected with its business. While Mrs. Carmichael was not officially labelled as an 'information clerk', the record indicates it was a part of her duty to meet customers as they came in and refer them to the proper employees or agents of the company. Her desk was an 'information desk' so far as the facts of this case are concerned. As we said in Northwestern Mutual Life Insurance Company v. Steckel, 216 Iowa 1189, 1196, 1197, 250 N.W. 476, 479, 'that individual was placed there by the appellee company as the person to whom people coming into the appellee company's home office should turn to ascertain with whom they should conduct their business.' There was ample evidence to support the trial court's finding that on September 25, 1948, O'Brien was a salesman, agent and employee of the defendant.

If he was a salesman for defendant, we think further there was substantial evidence he was acting within the apparent scope of his authority in what he did, including the conversion of plaintiff's car by the fraudulent sale. Of course, no one claims the defendant had authorized O'Brien to attempt to defraud the plaintiff by selling his automobile, pocketing the money and absconding. But he was within the apparent scope of his authority nevertheless. The rule is stated thus in 2 Am.Jur., Agency, section 363:

'* * * the principal * * * is responsible for the fraud of the agent if he has intrusted to the agent a matter which puts the agent in a position to perpetrate the fraud complained of while the agent is executing the agency transaction within the scope of his employment.'

This court has made several pronouncements upon the question. In Hopkins v. Hawkeye Insurance Company, 57 Iowa 203, 208, 10 N.W. 605, 607, we said:

'It is urged by the appellant that it is not liable for the fraudulent acts of the agent. * * * What he did in regard to taking the note was in the direct line of his employment, and his acts in regard thereto must be considered as the acts of his principal.'

In Mankin v. Mankin, 91 Iowa 406, 407, 59 N.W. 292, is this: 'Joseph W. Mankin was bound by the acts of his agent, John Mankin, the same as if he had notice of the fraud.' Again, in Wickham v. Evans, 133 Iowa 552, 558, 559, 110 N.W. 1046, 1048, this court said:

'Diltz was defendant's agent, * * *, and as such he perpetrated or attempted to perpetrate a fraud either upon plaintiff or upon the company. * * * This was the fraud of defendant's own agent, and for it the defendant is responsible.'

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