Labaree v. Peoria, P. & J. R.

14 F. Cas. 892, 3 Ban. & A. 180

• Court: U.S. Circuit Court for the Northern District of Illnois
• Decided: December 15, 1877
• Status: Published

Opinion

DRUMMOND, Circuit Judge.

It is rather difficult to determine what are the actual facts in this case, upon which the controversy arises, and I have come to the conclusion that I will decide it in favor of the defendant, on the ground that the plaintiffs have, by their conduct and action, enabled their agent, Wineman, to make a contract with the defendant under such circumstances that it had the right to assume that he was properly representing the patentee. It is not easy to reconcile all the various facts that appeared in the case, and that are stated by the two principal witnesses, Dunbar and Wineman, but conceding that the interest of Wineman in the subject matter of the patent was terminated by the repurchase by the patentee, Dunbar, of the right to the patent in the state of Illinois, I am inclined to think that when he sold again to Wineman, it was contemplated by the parties that the latter should have the same right he previously had over the patent in the state of Illinois, namely, that he should have the right to the use of the patent, during the life of the original patent, and during its extension. I concede the presumption is that when the resale of the right in the state of Illinois took place, when the right was reinvested in Dunbar, it put an end to the assignment that had been made to Wineman by Dunbar, and also to the power of attorney that had been executed, and that something beside must take place in order to re-clothe Wineman with the right vested in him by the power of attorney. It is certain that when Dunbar made the last transfer to him, he did not, by its terms, vest in the agent any right whieh might exist in the patentee by virtue of the renewal of the patent. But it is stated by Wineman, and I am inclined to think the statement is true, that when the attention of Dunbar was called to the fact that the extension was not mentioned in the deed, he spoke of his still having the power of attorney. We may assume, under all the circumstances of the case, that Dunbar knew that the power of attorney still remained in the hands of Wineman. and although, as a matter of law, its power might be spent, still we must visit upon Dunbar some of the consequences of his allowing it to remain in the hands of Wineman. He ought to have taken it up; then there would not have been the same effect given the testimony that I am bound now to give it. in consequence of the power being permitted to remain in the possession of Wineman. According to the testimony of the latter. Dunbar said, in effect: “It is possible that the roads will not ask for the use of the patented device during the extension, and if they do not. then you need not grant it to them, but if they do, you have the power of attorney and you can use it; you can give it to them.” This is often reiterated with every variety of phrase and form in the testimony of Mr. Wineman, and his testimony is rather more distinct and explicit than that of Dunbar’s, that he is, besides a disinterested witness, that is to say, he has no direct interest in this controversy as Dunbar has. The only thing which appears to throw some doubt upon this statement is the letter written by Wineman on the seventh of January, 1803, in which he says: “I have sold to six roads, and none of them have the right of extension. The Great Western, that you and I both sold to, has it, but the six I Sold to of course will have to get it from you. I think it is a good job; from all the roads you can realize a good many thousand dollars if you get your invention extended.”

“If you get your invention extended,” so that it is clear that at that time the writer of the letter did not suppose, or he assumed, that it had not been extended; that was a contingency which might or might not happen. In one reading of this communication, and in one view of it, it would seem to be inconsistent with the position which Wine-man now maintains, that he had authority, as he had by his original power of attorney, to make grants including the extension.

But, in another aspect, and read in another light, it is possible that it can be reconciled with the other view, and in consideration of all the testimony bearing upon the case, and of this particularly, that if a man trusts an agent and in consequence of the trust another person suffers, the party conferring the agency must bear the loss— the party who has been the means of giving the authority must suffer rather than the other. And again, there is some little significance, I think,.in the fact that at a subsequent time Dunbar did revoke, in a formal way, the power of attorney. I do not lay much stress upon the confirmatory statement made on the second of March, 1876, because I assume that it was a contract made by the agent with the defendant that there was to be included, when the money was paid, and it was so understood, the right of the extension as well as the right of the original patent. I dismiss as not worthy of any very serious consideration, the question whether or not Wineman signed the papers in proper form or executed them in a particular way. I do not think it Is material, when we look at it as a matter of pure equity, whether he -signed it as Wineman, or Dunbar by Wineman. A court of equity will look at the real state of the case, and so regarding it, will consider that as done which ought to be done. So that if a contract was actually made by which Dunbar was bound, and the extension of the patent was intended to be conveyed, a court of equity will treat it as done to carry out the purpose of the parties.

It is a question by no means free from difficulty, but on the whole, I think I shall have to dismiss the bill. Decree accordingly.