Gestring v. Fisher

46 Mo. App. 603, 1891 Mo. App. LEXIS 397

• Court: Missouri Court of Appeals
• Decided: November 10, 1891
• Status: Published

Opinion

Rombauer, P. J.

The plaintiff’s petition seeks to recover from the defendants $2,700, the alleged difference between the real value of certain real estate, and the price at which the defendants sold it to him. The cause of action is, that defendants, as agents of one J. C. Birge, undertook to sell said real estate to plaintiff, claiming authority to sell it for him at a stated price, while in fact they had no such authority from anyone ; and it rests on the familiar principle that, where one undertakes to enter into a contract as agent for another, and has no authority for so doing, he will be personally bound for the damages resulting from the non-performance of the contract. Upon the trial of the cause before a jury, the plaintiff recovered a verdict for $425, which was fully warranted by the evidence as to amount, if the view of the law taken by the court was correct. The defendants, appealing, assign for error that the evidence adduced warranted no recovery beyond $25 ; that the court excluded legal evidence offered by the defendants, and that it misdirected the jury as to the law.

The plaintiff gave evidence tending to show the following mentioned factor The defendants were real-estate agents in the city of St. Louis, and, as such, published a monthly real-estate price current, stating that no property was advertised therein, unless the exclusive agency for its sale was given to them. Among the items advertised in this price current was the following : ‘ ‘ Hempstead street, north side, one hundred feet east of Broadway, thirty-eight by one hundred and twenty-five, block 250 north, price $30 (perfoot).” The plaintiff saw this item, and sent his son to the defendants’ office to buy the property. The son met there one Meany, who was one of the sale clerks of the defendants, and he paid $25 earnest money for the purchase of this lot to Meany, who thereupon executed and delivered to Mm the following memorandum:

“ Office of Fisher & Co., \ S. J. Fisiier, Curves S. Fisher, (. Real Estate, Ño. 714, Chestnut St. j

“ St. Louis, April 29, 1890.

“Received of C. Gestring $25, as earnest money and in part payment of the purchase of lot on Hemp-stead street, north side, one hundred feet east of Broadway, being lot thirty-eight by one hundred and twenty-five in city block 250 north, of St. Louis, Missouri, sold to C. Gestring for the sum of $1,140, or $30 per foot, terms of sale as follows: Cash. Title to be perfect, or no sale. If the title is not perfect, earnest money to be refunded and examiner’s fees paid by us. Taxes of 1890 to be paid by purchaser.

“[Signed] J. C. Birge,

“Fisher & Go.

“ Agents.”

“ I agree to the above.

“[Signed] C. Gestring.”

The plaintiff also gave evidence that Meany, the clerk, before delivering the receipt, told one of the defendants that he had sold this property to the plaintiff, and that said defendant thereupon remarked that he was glad that the plaintiff got it, because, on the first of the month, the owner was going to put it up $10. There was no evidence that either of the defendants saw this receipt before it was delivered to the plaintiff’s son, nor was there any evidence that plaintiff’s son inquired any further into the authority of the defendants to sell this property at $30 per. front foot, except as herein-above stated. It was conceded by the evidence that the plaintiff was ready to consummate the purchase by payment of the residue of the purchase money, and that a formal tender was waived.

The following additional fact bearing upon the case also appeared in plaintiff’s evidence, namely, that J. C. Birge had no title to the property when the memorandum of sale was made, but that the title thereto was in Mary C. Birge, his wife, and that the defendants, more than ten days after the exechtion of the memorandum, and when threatened with litigation, wrote a letter to plaintiff containing the following statements:

“As we wrote your attorney, Mr. Rassieur, we regret that we are unable to carry out the agreement which was made with you to sell you lot on Hempstead ■ street. This is the first time, since we located in business in this city, that such a thing has happened ; but, as you were informed of this fact on the day subsequent to this transaction, we cannot see how it is possible that you can be damaged, either directly or indirectly, and, as you must surely know that it was not our purpose to treat you in this way, we cannot see what will be gained by litigation.” * * *

The plaintiff also gave evidence that the market value of the lot in question was at least $400 in excess of the price stated in the memorandum.

The defendants gave evidence showing that they had no written authority, either from J. C. Birge or his wife, the true owner, but had oral authority to sell this lot for $30 per front foot, provided this and another higher priced lot were sold together, and not otherwise. Meany, the defendant’s sale clerk, testified that, prior to the execution and delivery of the memorandum, he stated this fact to the plaintiff ’ s son, to whom the receipt was delivered, adding that, as the firm had no authority to sell this lot separately, the sale was subject to the owner’s approval, but that he would use his-best efforts to obtain such approval. He also testified that the memorandum of sale was copied in the letter press copy book of the defendants’ before it was delivered. The senior member of the defendant’s firm,., being examined on the defendants’ behalf, was asked successively the following questions: “What instructions, if any, did you give Mr. Meany in regard to the-sale of this piece of property in controversy, the Hemp-stead property ?”• “Has Mr. Meany. ever made a sale of property for. Fisher & Co., without instructions from, you or your son, a member of the firm?” These questions were excluded by the court upon the plaintiff’s objection, and the defendants excepted and still except. The witness, however, did testify, in answer to other questions, that Meany was employed by him, together with others, to make sales ; that he gave them all the same instructions ; that everybody entering the office to-buy property was met by his agents or salesmen at the-door, and the salesmen tried to make sales to such person ; that, if they succeeded in agreeing upon the price- and terms, the agent or sub-agent, or clerk in the witness’ office, stepped back and saw whether there was-any authority in writing in the office to sell the property, and, if there was no such authority in writing, conditional sales were made, to be approved by the-owner afterwards, but that, if the authority was found, to be there, an unconditional sale was made without • being subject to any approval whatever; that, where-the authority was not in writing, the same was made subject to the owner’s approval in all cases, unless the-witness himself otherwise ordered.

The defendants asked the court to instruct the jury-as follows: “The court instructs the jury that, under the pleadings and the evidence in this case, the plaintiff is not entitled to recover beyond the sum of $25.”

“The court instructs the jury that, if they believe from the evidence that the defendants were ignorant of the fact, that one Joseph P. Meany had signed the name of J. O. Birge, Fisher & Co., agents, to the receipt read in evidence, and dated April 29, 1890, at the time said receipt was so signed and delivered by the said Meany to John Gestring, and that the defendants, as soon as they learned the contents of the said receipt, refused to recognize said receipt; and, within a reasonable time thereafter, notified plaintiff of that fact, then, there was no ratification of said receipt by the defendants, and the jury should find their verdict for the defendants.”

The court refused so to instruct, but instructed the jury as follows : “The court instructs the jury that, if they find from the evidence that witness Meany was in the employ of the defendants as a salesman of real estate on April 29, 1890, and that a part of his duty, as such salesman, was to receive earnest money on sales, and to execute and deliver contracts in writing of such sales, in the name of the firm of defendants ; and, if the jury further find that, on said day, said Meany did execute, sign and deliver the receipt read in evidence, and that at said time defendants had no written authority from the owner of the real estate therein described to sell the same, and that defendants, within a reasonable time after said date, failed and refused to procure and deliver to plaintiff a deed for said real estate, and that plaintiff, or his agent, offered to comply with the terms of said sale, and demanded a deed, then the jury will find a verdict for the plaintiff, unless you believe and find from the evidence that at, or prior to, the time when said receipt of April 29, 1890, read in evidence, was delivered by said Meany to said John Gestring, he, the said Gestring, knew or was informed that said Meany had no authority to make or execute the said receipt, or knew or was informed that said Fisher & Co. had no written authority to make a sale of said property, or knew or was informed that said sale, evidenced by said receipt, was made subject to the approval of the owner of the property, or unless you believe from the evidence that said receipt was received by said John Gestring with the understanding at the time that Meany, or Fisher & Co., would endeavor to obtain the approval of the owner to such sale, and that they were not able to do so, after reasonable efforts, as explained in the instructions given you, and marked numbers 4, 5, 6 and 7.”

“Unless you find and believe from the evidence that the instructions spoken of by the witnesses, Fisher and Meany, in regard to the sale of the property mentioned in the writing, dated April 29, 1890, read in evidence, were known or communicated to John Gestring at or before the delivery of said writing by Meany to said Gestring, they cannot affect the rights of the plaintiff in this case, and, in that event, the testimony in relation thereto should be wholly disregarded by you in arriving at a verdict in this case.”

“If the jury find for the plaintiff, they will assess his damages at such sum, if any, as the jury may find from the evidence the reasonable market value of the premises described in the petition, in the first week of May, 1890, was greater than the price fixed by the memorandum of sale, together with the amount paid by plaintiff as earnest money to the defendants.”

We have set out the record thus fully, because it raises some propositions which are seemingly novel. That an agent who undertakes to bind a principal, when, in fact, he has no power to do so, thereby renders himself individually responsible, is an elementary proposition, and it makes no difference whether in so doing - the agent acts in good faith or otherwise. In Smout v. lluwry, 10 M. & W. 1, it is stated that one of the cases rendering an agent thus responsible is, where, not having in fact authority to make the contract as agent, he yet does so under the belief in good faith that such ■authority is vested in him, and that view is approved in Wright v. Baldwin, 51 Mo. 269. But a contract of a real-estate agent in selling property intrusted to him for that purpose is peculiar. In absence of an express agreement to the contrary, he does not undertake to bind all claimants of the title, nor that he will sell an unincumbered fee-simple title, but only that he will «ell such title as his principal has. Whether the sale is finally consummated depends, generally, upon the further question whether his principal has a perfect title, or, if not, whether the vendee is satisfied with an imperfect title. The agent, by his agreement to negotiate a sale, assumes no obligation in reference to the title, unless it was made a part of his duty to have the title examined before attempting to affect a sale (Gerhart v. Peck, 42 Mo. App. 651), or unless he warrants the title to the vendee.

Now, in the case at bar, the petition charges, that the defendants pretended to have authority f rom one J. O. Birge, under which they agreed in his name to «ell to plaintiff a lot of land belonging to said Birge; that they had no such authority ; that the plaintiff tendered to Birge the purchase money, and demanded of him a conveyance of the lot, which Birge refused to make, etc. The proof offered is in support of the pleadings. The plaintiff claims under the memorandum, which he asserts must be taken as evidence of the sale which the defendants agreed to make to him of the title •of J. C. Birge. The memorandum purports to bind J. C. Birge as principal, and no one else. The statement, “title to be perfect or no sale,” relates to the title bargained for. That condition, it is true, is inserted for the benefit of the vendee, and he may waive it, and the vendee claims that he has waived it by insisting on a ■deed from J. C. Birge, so that giving his evidence the greatest effect, we are ready to concede that he has shown a cause of action. But a different question arises when it comes to the measure of his damages. The theory of damages is compensation, and the plaintiff’s own evidence shows, that, if he had got all he unconditionally bargained for, namely, J. C. Birge’s title to the lot, he would have got less in value than what he agreed to pay for it, because that evidence shows that the title to the lot was in Mary C. Birge, and not in J. C. Birge, and a husband has no more power to convey his wife.’s title to lands than a stranger. The uncontradicted evidence shows that the $25,- which plaintiff had deposited as earnest money with the defendants, was tendered to him at once upon a failure of the sale, although the tender was not kept up by deposit in court. As the plaintiff has shown no other substantial damages, which he could recover on any compensatory theory, we must conclude that the court erred in not instructing the jury, as requested by the defendants, that the recovery was limited to that sum, and also erred by giving the instruction on the measure of damages, requested by the plaintiff.

In view of the recurrence of other questions which arise upon this record, we deem it proper to make the following additional observations. The plaintiff was justified in assuming from the prospectus published by the defendants, and from their acts in trying to sell this lot to him, that they had legal authority from some one to sell it. If this were a question between the plaintiff and the owner, the law would be different. We also add, what we had recent occasion to s ay in another case, that instructions from the principal to the agent are always admissible in evidence, ánd hence there was no valid objection to the admission of the oral instructions given by Fisher to Meany, although the ruling out of that evidence in view of the subsequent testimony of Fisher which was admitted, could hardly be deemed to be prejudicial error. Where the agent receives instructions, they always form the limit of his authority between himself and his principal. Where the agent is held out to the world as possessing greater authority, the principal is estopped from relying on undisclosed instructions, as against persons who relied, on the agent’s apparent authority, but, as such holding out is a question of fact for the jury, we cannot see on what principle the court can rule out instructions from the principal to the agent, simply because the jury are justified in finding that such instructions are opposed to the apparent authority of the agent.

All the judges concurring,

the judgment is reversed, and the cause remanded.