Talge Mahogany Co. v. Yeager Manufacturing Co., 202 N.C. 814 (1932)

June 15, 1932 · Supreme Court of North Carolina

202 N.C. 814

THE TALGE MAHOGANY COMPANY v. YEAGER MANUFACTURING COMPANY et al.

(Filed 15 June, 1932.)

Principal and Agent O b — Authorization of agent held ambiguous and his action thereon in good faith bound his principal.

Where the principal instructs his agent by telegram to sit in on a creditors’ meeting and “plug for us,” the words of the authorization are ambiguous, and where the agent and the debtor, in good faith interpret and act on it as authorization to the agent to execute in the principal’s name a comijromise agreement with other creditors whereby claims were settled on a percentage basis: Held, in the absence of repudiation of the agreement by the principal upon notification thereof, he may not contend that the agent exceeded his authority and that he was not bound by the agreement.

Appeal by plaintiff from Moore, J., at September Term, 1931, of Catawba.

Civil action to recover tbe sum of $1,922.51 evidenced by two promissory notes given by tbe defendant to tbe plaintiff.

On 22 April, 1930, defendant wired plaintiff, a nonresident corporation, as follows: “We desire to bave consultation with some of our creditors Friday, 25 April, two p.m. Please wire us immediately whether you can attend this meeting.”

On 24 April, plaintiff wired W. 0. Carter, its salesman for this territory, as follows: “Yeager calls creditors meeting for tomorrow at two can you arrange to sit in and plug for us.”

On 25 April, Carter replied: “Answering will attend Yeager creditors meeting and report.”

Pursuant to above authorization, W. 0. Carter attended creditors’ meeting 25 April, 1930, and executed in tbe name of bis principal, along with tbe representatives of ten other creditors, a compromise agreement to accept % in cash or % on terms, in full of their claims. This agreement is pleaded in reduction of plaintiff’s right to recover on tbe notes in suit. Tbe case turns on Carter’s authority to bind tbe plaintiff.

Tbe question of Carter’s authority to sign tbe compromise agreement was submitted to tbe jury, who found in favor of such authority. Judgment was thereupon entered agreeably to tbe terms of said agreement. Plaintiff appeals, assigning errors.

Theodore F. Cummings and F. B. Cline for plaintiff.

Thomas P. Pruitt and W. A. Self for defendants.

Stagy, 0. J.

Tbe language of tbe agent’s authorization, -“to sit in and plug for us” at creditors’ meeting, reasonably lends itself to tbe interpretation placed upon it in good faitb by Carter and tbe defendant, and tbe jury was justified in taking tbe same view of it. 2 C. J., 559. Cole v. Fibre Co., 200 N. C., 484, 157 S. E., 857.

Tbe expression “plug for us,” to say tbe least, is ambiguous and equivocal, and tbe principle applies that a letter or telegram of instruction from a principal to an agent should be expressed in clear language, and if not expressed in “plain and unequivocal terms, but tbe language is fairly susceptible of different interpretations, and tbe agent in fact is misled and adopts and follows one, while tbe principal intends another, then tbe principal will be bound, and tbe agent will be exonerated.” Story on Agency, sec. 74; Winne v. Ins. Co., 91 N. Y., 185.

Tbe telegram of authorization did not ask for a report of tbe meeting. However, a report was made in keeping with tbe agent’s reply, and it is to be presumed that Carter informed tbe plaintiff, of bis execution of tbe compromise agreement. We have failed to find on tbe record any specific repudiation of Carter’s action in this respect. Gordon J. Talge, a witness for plaintiff, does say that be expressed great surprise on 20 June, 1930, when Yeager informed him of Carter’s signature to tbe agreement and that Carter made no reference to it in bis report. It is also in evidence by John H. Talge, witness for plaintiff, that Carter bad no authority to compromise plaintiff’s claim. But no repudiation seems to have been made. Tbe plaintiff cannot in-justice defeat tbe compromise agreement by putting an interpretation upon its instructions at variance with that of its agent and tbe defendant, since tbe language clearly warrants tbe latters’ interpretation. 21 R. C. L., 907.

No error.