Mabe v. B.P. Oil Corp.

356 A.2d 304, 31 Md. App. 221, 1976 Md. App. LEXIS 486
CourtCourt of Special Appeals of Maryland
DecidedApril 14, 1976
Docket341, September Term, 1975
StatusPublished
Cited by7 cases

This text of 356 A.2d 304 (Mabe v. B.P. Oil Corp.) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mabe v. B.P. Oil Corp., 356 A.2d 304, 31 Md. App. 221, 1976 Md. App. LEXIS 486 (Md. Ct. App. 1976).

Opinions

Lowe, J.,

delivered the opinion of the Court. Powers, J., concurs and filed a concurring opinion at page 236 infra. Melvin, J., dissents and filed a dissenting opinion at page 237 infra.

“A large portion of the transactions of the modern business world is carried on by simple and informal means. A word or look or gesture often suffices to give assent to great undertakings or to set in motion the complicated machinery of commerce. Little, often, is said or written, but that little carries with it a train of legal consequences no less certain and definite than if the whole were included in the spoken or written words. This being so good faith is strenuously insisted upon, and one who by his conduct has led an innocent party to rely upon the appearance of another’s authority to act for him, will not be heard to deny the agency to that party’s prejudice. Hence it is that in many cases the existence of an agency is implied or presumed from the words or conduct of the parties, and this, too, although the creation of an agency was not within their immediate contemplation.”
“It may therefore be stated as a general rule that whenever a person has held out another as his agent authorized to act for him in a given capacity; [223]*223or has knowingly and without dissent permitted such other to act as his agent in such capacity; or where his habits and course of dealing have been such as to reasonably warrant the presumption that such other was his agent, authorized to act in that capacity; whether it be in a single transaction or in a series of transactions, his authority to such other to act for him in that capacity will be conclusively presumed, so far as it may be necessary to protect the rights of third persons who have relied thereon in good faith and in the exercise of reasonable prudence, and he will not be permitted to deny that such other was his agent, authorized to do the act that he assumed to do, provided that such act is within the real or apparent scope of the presumed authority.” Mechem on Agency, §§ 83, 84. (1st ed. 1888).

These are the observations of Floyd R. Mechem, expressed in 1888, in his classic work on Agency. He further indicated in a later edition that because of the necessity of proving the element of reliance, the application of the doctrine in tort cases was limited at best.

“Reliance upon appearances, however, does not ordinarily induce to assault, slander, trespass, or negligent injury, and the cases must be rare, if any, in which it could be an element.” Mechem, supra, § 724 (2d ed. 1914).

That observation was perhaps fitting in context of the times over a half century ago, before the conformity demands of national franchise merchandising. There subsequently have developed refinements to the doctrine of “apparent agency” and the related doctrine of “agency by estoppel”, but the basis for liability remains relatively unchanged — that one should be bound by, and responsible for, his assertions.

The line of demarcation between apparent agency and agency by estoppel is not always clear, Reserve Ins. Co. v. Duckett, 240 Md. 591, 600, since both theories require essentially the same elements: outward manifestation by the [224]*224“principal” that an agency relationship exists upon which the one seeking to recover has reasonably relied.1 When invoking agency by estoppel, however, one must also show a change of position by the third person such that it would be unjust for the purported principal to deny his words or manifestations. Restatement, Agency, 2d, § 8, Comment d. While agency by estoppel is generally used in tort actions and apparent agency in actions based on contract, that usage is not mandatory.

Although there is no Maryland case law dealing with the liability for tortious acts of apparent servants, the definition adopted by the Court of Appeals to describe apparent authority or authority by estoppel in cases based on contractual liability is sufficiently comprehensive to include tort liability as well. The general principle was stated by that Court in Hobdey v. Wilkinson, 201 Md. 517, 526.

“One who knowingly permits another to act for him as though authorized, inducing third persons to rely to their disadvantage on the seeming authority, is estopped from later asserting the lack of authority of his apparent agency.”

See also Reserve Ins. Co. v. Duckett, supra, at 600-601. The definition adopted by the American Law Institute in the Second Restatement of Agency is basically the same as Maryland’s definition, but utilizes language associated with the law of torts:

“One who represents that another is his servant or [225]*225other agent and thereby causes a third person justifiably to rely upon the care or skill of such apparent agent is subject to liability to the third person for harm caused by the lack of care or skill of the one appearing to be a servant or other agent as if he were such.” Restatement, Agency, 2d, § 267.

The case before us on appeal presents a classic example of facts giving rise to liability based on apparent authority. It is for this reason that we have briefly reviewed the law — that our recital of those facts may be viewed in its proper context.

The Case Before Us

Claude J. Mabe testified that, while driving with his father and brother in Baltimore City, they noticed that their automobile needed both gas and water.

“Q Now, you say that you needed gasoline and water? You pulled into where?
A Hilton BP filling station.
Q Were there any other gas stations in that same area?
A Yes, sir.
Q Where were they?
A There was an Exxon on the left-hand side and Gulf station up the — just up the street a little farther.
Q Why did you choose the BP station?
A Because I always buy BP gasoline, always deal with BP.
Q Had you dealt with BP before?
A Yes, up on 29th Street and Greenmount Avenue. I[t] was right around the corner from where 1 lived at.
Q How often had you dealt with them?
A I had been dealing with them for around about a year at that time.
[226]*226Q Was there anything in particular you — attracted you to the BP station on Hilton Street?
A Nothing except for the BP station, had BP signs, BP gas, BP pumps.
Q Was there any sign up that said anything about being operated by anybody other than BP?
A No, sir.
Q Now, when you drove into the station, what was the first thing that happened?
A Well, the car was on hot so I asked the man for, you know, water to put in the radiator and he handed me a container which I thought was water and so did he, apparently.
Q Can you describe the container?
A It was a regular water can with a spout on it.

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Mabe v. B.P. Oil Corp.
356 A.2d 304 (Court of Special Appeals of Maryland, 1976)

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356 A.2d 304, 31 Md. App. 221, 1976 Md. App. LEXIS 486, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mabe-v-bp-oil-corp-mdctspecapp-1976.