Van Santvoord v. Smith

• Decision Date: 02 May 1900
• Citation: 82 N.W. 642,79 Minn. 316
• Parties: VAN SANTVOORD et al. v. SMITH et al.
• Court: Minnesota Supreme Court

79 Minn. 316

82 N.W. 642

VAN SANTVOORD et al.

v.SMITH et al.

Supreme Court of Minnesota.

May 2, 1900.

Appeal from district court, Pipestone county; P. E. Brown, Judge.

Action by Seymour Van Santvoord and others, receivers for the Walter A. Wood Mowing & Reaping Machine Company, against Arthur P. Smith and others. Verdict for defendants. From an order refusing a new trial, plaintiffs appeal. Affirmed.

Syllabus by the Court

1. A contract not under seal, and containing no restrictions against it, may be changed and modified by a subsequent parol agreement.

2. A general contracting agent, having a general supervision of his principal's business in a particular territory, whose authority with respect thereto is not limited or restricted, may consent to a change and modification of a contract made by him with a third person, if such change or modification be in the line of the principal's business.

3. Instructions to such an agent by the principal, ‘not to make parol contracts with agents,’ not having been brought to the notice of the person with whom the agent contracts, are not effectual as to such person. Ashley Coffman and Evans & Evans, for appellants.

F. L. Janes, for respondents.

BROWN, J.

Appeal by plaintiffs from an order denying a new trial after verdict for defendants. The action is one to recover upon an alleged guaranty of the payment of certain promissory notes taken by defendants on the sale of machinery, as agents of the Walter A. Wood Company, a corporation, of which plaintiffs are receivers. The facts are as follows: During the year 1892, the Walter A. Wood Mowing & Reaping Machine Company was, and since has continued to be, a corporation, engaged in the manufacture and sale of farm machinery, having its place of business and principal office in the state of New York. On the 15th day of February, 1892, the defendants, as co-partners, entered into a certain written contract with said corporation, by the terms of which said defendants were constituted and appointed agents for the sale of its machinery at Jasper, this state. Said contract contains, among other conditions and agreements, the following: ‘Second. To make sales only to parties of well-known responsibility, * * * and to require that all notes shall bear true statements of the real and personal property of the makers, filled out and signed by them. * * *’ And also the following provision: ‘Fourth. Said second party hereby guaranties payment of, and agrees to indorse, all notes and renewals of notes (except such as bear property statement, as required by article second herein), in the following form, to wit: ‘For value received, I hereby guaranty the payment of this note, and any renewal of same, and hereby waive demand, protest, and nonpayment.’ Failure by said second party to indorse notes not bearing property statement, as herein provided for, shall not affect the above guaranty of payment.' In July, 1892, said defendants, as such agents, sold and delivered one of the machines furnished them by said corporation to one W. C. Storts, taking in payment therefor two promissory notes, payable to the corporation, each for the sum of $67.50. Defendants did not procure from Storts a property statement, as required by the terms of the contract. Storts failed to pay the notes, and this action is brought upon defendants' contract of guaranty, above set out. There is no controversy about these facts. Defendants admit them. Their defense to the action is that, subsequent to the date of entering into the contract with the company, they found that it would be impossible to obtain from purchasers of machines the required property statement, which fact they communicated to the general contracting agent of the company, E. F. Andrews, with whom they made their contract, and that, by the mutual consent of the parties, the contract was changed and modified by relieving defendants of the obligation and duty of procuring the same, and from their agreement to guaranty the payment of all notes not accompanied with such statement. And they claim that the machine was sold to Storts by them, acting under the modified contract. The agreement to change and modify the contract was made, if at all, on the part of the company by its said agent, E. F. Andrews. Plaintiffs deny that the agreement was modified or changed in any respect; and they contend, further, that Andrews had no authority to change or modify it, if it be found that he did so as a matter of fact. There are but two questions in the case, as we view it: First, was it competent for the parties to change and modify the contract in the respect mentioned by a parol agreement; and, second, had Andrews authority to so act?

The contention of appellants is that no modification of the contract could be made by the parties except in writing, and that, in any event, Andrews had no authority to make such a change as is claimed by defendants to have been made. The contract is an ordinary contract of agency,-a...