Hunter v. Jameson, 28 N.C. 252, 6 Ired. 252 (1846)

June 1846 · Supreme Court of North Carolina

28 N.C. 252, 6 Ired. 252

JASON H. HUNTER vs. SAMUEL Y. JAMESON.

When an agent is appointed to sell articles of personal property, the law implies that he has a right to warrant their soundness, in behalf of his principal.

If he sells the articles with such a warranty as binds him personally, and damages are recovered against him upon the warranty by the purchaser, he has a right to bo reimbursed by his principal to the amount of such damages, as well as of the necessary costs incurred in defending the suit. Ruffin, C. J. dissentient as to the last point.

Appeal from the Superior Court of Law of Macon County, at the Fall Term, 1845, his Honor Judge Bailey presiding.

This was an action of assumpsit, in which the facts appeared to be these :

The plaintiff was the agent of the defendant to sell for him clocks in the County of Haywood. He sold one to Conrad Rhinehart, which he warranted. He was sued by the purchaser for a breach of the warranty in the County Court of Haywood, and a judgment being obtained against him, he appealed to the Superior Court, and from thence removed the case to the County of Macon, where it was tried, and a judgment rendered against him, which he paid. This action is brought to recover the amount of that judgment and the cosps. The defendant was present at the trial in the County Court of Haywood, and treated the ease as his.

The presiding Judge instructed the jury that all contracts made by an agent within the scope of his authority, were binding upon his principal; that if they were satisfied the defendant employed the plaintiff to sell clocks for him in Haywood, he had a right to warrant them, as being within the scope of his authority and connected with the act of sale, and it was not therefore necessary for the plaintiff to show that he was expressly instructed by the defendant to warrant them; that if Hunter was the agent of the defendant, and did not disclose that fact to Rhinehart at the time of the sale, he would be personally responsible to Rhinehart, and the defendant would be liable to him not only for the damages incurred, but for all, which he incurred bona fide in the defence of the suit brought against him. A new trial was moved for upon the grounds, 1st, because of the admission of improper testimony ; 2d, for misdirection as to the law, and 3d, for the additional reason, that if, when the clock was warranted, Rhinehart knew Hunter was an agent, or this was made known to him, he could not have recovered upon the warranty against Hunter, and it was the duty of Hunter to have shewn that upon the trial. A new trial was refused, and the defendant appealed.

No counsel in this Court for the plaintiff.

Francis, for the defendant.

Nash, J.

As to the first reason assigned for a new trial, it is sufficient to say the case does not disclose what testimony the defendant objects to, nor does it shew that there was any objection made to the reception of any testimony at the time it was offered. We are therefore to presume it was received by consent, and, after verdict, neither party can be heard in objection to it. Upon the questions of law, we see no error in the opinion of his Honor. The defendant prayed the Court to instruct the jury, that, if he was bound by the warranty, then Hunter cannot recover in this action, because he was not liable, in the suit brought against him, Jameson being alone liable to the purchaser. The instruction prayed for, naturally connects itself with the second objection taken by the defendant’s counsel on the argument, which is, if Hunter warranted the' clock to Rhinehart, without instructions from Jameson, and a recovery was subsequently made against him by the purchaser, in law the present defendant is not liable in this action. It is also connected with the third reason assigned for a new trial, namely, that if, when Hunter warranted the clock to Rhinehart, the latte)- knew he was an agent, and who the principal was, he could not have made a recovery against Hunter, and it was the duty of the latter tó have shewn that upon the trial against him; These propositions will be con- . sidered together.

In order to show that an agent without special instruc • tions cannot by a warranty bind his principal, ,our attention has been called to a passage in Viner’s Abr. Tit. Master and Servant, Letter D, p. 313. It is there stated, if a servant sell a horse, with warranty, it is the sale and contract of the master, but it is the warranty of the servant, unless the master give him authority to warrp'nt. If it is meant that the warranty so made does not bind the master, and certainly such must be its meaning, the principle is not sustained by the more modern authorities. In all cases, where a person, in his own right, has power to do a particular thing, he may do it by another, and in every delegation of power to an agent, is included the authority to use all the means that are .usual- aud necessary to the execution of it with effect — 2 H. Bl. 618 — . unless specially restricted in the mode. Thus, an agent, eriiployed to get a bill discounted, may endorse it in the name of his principal, so as to bind him, unless expressly restricted. Fen. and Harrison, 3 Term, 757. So a servant entrusted to sell a horse may warrant him, unless forbidden. Brown on Actions, 174, 29 Co. Litt. 1299. Paley on Agency, 210, 28 Law Libr. 91. Nor is it necessary for the purchaser in such case to shew, that the agent had any special authority to warrant. The employment gave the power, Hilyear v. Hawke, 5 Esp. N. P. Ca. 75, 3 Term Rep. 757, Alexander and Gibson, 2 Camp. 555. These cases are at war with the doctrine in Viner, and overrule it. They establish conclusively, that, in every general agency by parol, the agent has authority to bind his principal by a warranty. We are not considering now, nor is it necessary in this case, how far the restriction, put by the principal upon an agent’s power in selling, affects the purchaser. The question does not arise. The jury have found that Hunter was a general agent for the defendant in selling clocks for him in the County of Haywood, and it is not pretended that he had been forbidden to warrant. Runquish and Ditchell, 3 Esp. 65. . Nor does the case of Fen and Harrison, 3 Term 757, aid the defendant in his position. There, the agent, who was employed to get a bill discounted, was informed by his principal, that he would not indorse it, and the question was, he having done so, whether the principal was liable to the indorsee — not the case we are considering. ■ But, in that case, Lord Kenyon doubted, or rather denied, the ease, cited at the bar, of the servant warranting a horse on a sale, contrary to the instructions of bis master, and says expressly, the maxim of respondeat superior would apply, and the principal has his remedy against the agent. But, as before remarked, that is not the case here. The case of Fen and Harrison was before the Court of King’s Bench three times. In the two first trials, it was treated as the case of an indorsement by an agent, who had been forbidden so to do ; and the contest was, whether, under, such a power, the agent could bind the principal. On the third trial it was' shewn, that the principals, the defendants, did not say they would not indorse the bill. The Court were unanimous in deciding, that, as the defendants' had authorized their agent to get the bill discounted, without restraining his authority as to the mode of doing it, they were bound by his acts. 4 Term R. 178.

But it is said, that although the defendant may have-been bound to answer to the purchaser by the warranty made, lie is not answerable to the plaintiff, nor bound to repay to him the money recovered from him by the purchaser. In suppoi’t of this proposition, it is said,, that, if Hunter, at the time he sold the clock to Rhinehart, made known the name of his principal, the latter alone would have been bound ; and the purchaser could have had no action against him. Bat, as he chose not to do so, the warranty was his own personal contract, and the money,, paid by him on the judgment, was money paid on his own account, and not on that of the present defendant. Without stopping to enquire the extent to which the first branch of the proposition is true, because the question does not arise here, we cannot yield our assent to the second branch. We do not so consider the law to be. We admit, that, by not disclosing his principal, he subjected himself to the action of the purchaser, but assuredly the purchaser had a good cause of action against the present defendant, the principal. When an agent, in making a contract of sale, does not disclose the name of his principal, the purchaser, when he discovers the principal, has his election which to sue, and if he can sue the principal, it must bo because he is bound by the contract of warranty as well as of sale. Patterson v. Gran-dasequi, 13th East. 62. Although then it be true, that by not disclosing the name of his principal, the plaintiff subjected himself to the action of Rhinehart, it was upon a contract made by him for the defendant, which by his agency the defendant authorized him to make. The doctrine, it is likely, is founded upon what is said in Vine'r, in the passage before referred to. We know of none other. It is there said, that when a servant does so warrant a horse, it is the sale and contract of the master, but the warranty of the servant, and the master is not answerable upon the warranty, because not annexed to the contract. Hut wc have seen that the leading principle of that case has been over-ruled, and with it must fall the incidents ; the warranty is annexed to the contract. If the doctrine were, as contended for, it would present a singular result. The purchaser, having his election to sue either, by bringing his action against the agent would throw the whole responsibility on him and the whole loss on him, for he would have no redress on his principal, for whom and by whose authority he was acting. This cannot be so ; it would be unjust. Here is an unrestricted agency to sell, and it confers the power to sell, in the usual and customary way, Paley on Agen. 212 — 28th vol. L. Lib. 91, and when such a contract exists, the law implies a guaranty on the part of the principal to indemnify the agent from all the legal consequences, that follow the sale. This principle is fully established by the case of Adamson v. Jarvis, 4 Bing. 66, 13th En. C. L. R. 345. There the defendant had employed an agent †0 sell for him certain goods, to which it subsequently appeared he had no title. The agent sold the goods, and was sued for their value by the true owner and a recovery had against him, and that action was brought by the agent to be indemnified. Chief Justice Best, in delivering the opinion of the Court, says : “ It has been stated at the bar, that this case is to be governed by the principles which regulate all laws of principal and agent — ■ agreed — every man, who employs another to do an act which the employer appears to have a right to authorize him to do, undertakes to indemnify for all such acts as ■would be lawful, if the employer had the authority he pretends to have.” This covers the principle of the case before us. The defendant, Jameson, not only seemed, but had the power, to authorize the plaintiff to make the warranty, and did so authorize him, as far as the case discloses the fact to us. As there observed, auctioneers, brokers, factors and agents do not, generally, take regular indemnities. The consequences would, to them, be serious, if having sold goods, and paid over the proceeds, upon being made to suffer in damages for a breach of a warranty, they should find the loss must be theirs, and that they had no legal claim upon their principal for indemnity, for whom and at whose request they had acted.. The doctrine of this case has been recognized both in New York and in Connecticut. Powell v. Trustees of Newburgh, 19th John. R. 228. Stocking v. Sage and others, 1st Day’s Rep. 522, and is perfectly in accordance with reason and justice.

We have examined the other cases relied on by the defendant’s counsel, and perceive nothing at variance with those cited above.

We are of opinion, then, that the warranty made by the plaintiff Hunter, was within the scope of his authority, and bound both himself and the defendant, and that the latter is bound to indemnify the plaintiff to the full amount of the recovery, made by Rhinehart against him.

On the trial below, the plaintiff, under the charge of his Honor, recovered in damages $70 40; how much of this sum,, if any, was allowed for his expenses in defending the suit,, the record does not state. Nor, indeed, does-it show that any tiring was allowed on that ground, or for the costs of the suit against blunter. But we have no doubt the latter were included, and we are of opinion, he was entitled to recover them. In truth, the defendant’s-objection admits he was bound for the costs of the County Court, as he only contests those incurred by the appeal and removal. He was present at the first trial, and, the case states, managed the defence. It is not to be believed that the appeal was without his approbation. If opposed to it, he might very easily have stopped it by paying up the judgment. He did not do so, nor does it any where appear that he made any effort to stop the case. From the record, it does not appear that the plaintiff has recovered, for his costs, more than was taxed against him. in the suit of Rhinehardt. The last three cases cited are-authorities to shew he was legally entitled to recover-them.

As to the want of due foi’m in the judgment against the plaintiff, the same remark applies as heretofore given. The defendant comes too late with his objection. It is not the foundation of this suit, but evidence of the ambunt of the plaintiff’s claim,

We see no error in the opinion of the Court below, and the judgment is affirmed.

IIuffin, C. J.

dissent. The useful habit of free consultation between the members of the Court, while I have had the honor of sitting here, has generally resulted in a concurrence of opinion. When my own mind may not have been entirely satisfied with the result of a conference with them, or the reasoning by which my brethren reached it, yet I have been so much impressed with the public importance of giving to the judgments of the Court all the weight of unanimity, and have been so little wedded to any peculiar notions of my own. that I have willingly yielded to my brethren. I have therefore very seldom ventured to dissent from them ; and I should with pleasure adhere to that course now, if what I conceive to be my duty to the law would allow me. Believing, however, that the decision of the Court is against .prin-cipie, and not supported by any just reasoning, I feel bound to express my opinion against it.

I have to remark, that, as far as my brethren are influenced by the part which Jameson is supposed to have taken in the management of the suit, brought by Rhine-hardt against the present plaintiff, they would find upon a closer examination, there is some mistake of fact, which makes it unsafe to put any part of the case on that, point. The case, indeed, states that the suit was brought in the County Court of Haywood, and that Jameson was present at the trial, and then instructed the counsel and treated the case as his own ; and from a judgment against him in that Court, that Hunter appealed to the Superior •Court, and thence removed the trial to Macon. That would be all plain enough, if it were not contradicted by the record of that suit, which is annexed to the case and expressly made a part of it. From that it appears, that the suit was brought by Rhinehardt originally in the Superior Court of Haywood, and that it was removed by the defendant, Hunter, before any trial, to Macon: so that there was no trial in the County Court or in any Court before the final trial in Macon, at which the present defendant could have assisted, or done anything to induce the belief that he treated the cause as his own, and thereby sanctioned what had been done by Hunter in warranting the clock, as having been done at his request. But this is a matter of little moment, as it affects only the present parties; and I should not advert to it, were it not to let the parties see, that I had duly ascertained the facts of their case, as well as considered the matter o; law. To the general question of law involved in the case, I will now proceed.

The plaintiff declares upon a contract of indemnity., and also for money paid to the use and at the request oi the defendant. He could declare in no other way; and both counts involve essentially the same matter both oí' law and fact. He alleges, in support of them, that the defendant employed him as an agent to sell clocks for the defendant, and that he sold one to Rhinehardt and warranted it to be of good quality, and has been compelled to pay thereon a sum of money as damages and costs, for which he brings this suit. The defendant raised objections, questioning in several forms the authority of the plaintiff to make a warranty upon a sale. But I agree clearly, that, it not appearing that the agent was forbidden, he had the authority to give the principal’s warranty, both as between the purchaser and the principal, and the latter and the agent. I agree, moreover, that in such case, if the agent do not disclose the principal at the time of the sale, yet the purchaser may, upon discovering the principal, suq him; for it is the warranty of the owner, and is annexed to the contract of sale, which is made by the principal through his agent. Further, I yield that the purchaser may, in this last case, sue the agent on the warranty ; because, although he was in fact acting as agent, yet the purchaser was not informed of it, but dealt with him as if he had been the owner, and therefore, had a right to treat him as contracting for himself. Therefore, I am willing to say that the warranty was that of each — the principal and the agent; and to treat the case precisely as if the agent had expressly given the warranty of the principal, and also expressly given his own: which, I think, is going as far as the plaintiff could ask. Certainly, nothing less will answer the plaintiff’s purpose.^ For, if he was forbidden to warrant, although the principal might still be liable to the purchaser, upon a warranty made by the agent, yet the agent would be answerable over to the principal for breach of instructions ; and, consequently, could not recover for a loss upon a warranty, which he volunteered of his own. So, if the agent had authority from the principal to warrant, and did warrant in the name of the principal, and not for himself, then he, the agent, would not be liable thereon, and there could have been no recovery in the action brought, against him. It follows, then, that Hunter must be taken to have given his own warranty, either by itself, or in addition to a warranty of his principal. It is for damages, sustained by reason of a warranty of the properties of the clock, which bound him personally, that he brings this suit. Now, it is clear, the defendant cannot be bound to -indemnify him against the consequences of such a warranty, unless the plaintiff entered into it, at the instance of the defendant. In the same manner, a request from the defendant must be shewn in order to support the count for money paid to the defendant’s use. For, if the 'plaintiff paid the money officiously, that is, without being bound for it, or became bound for it officiously, that is, without the defendant’s .request to him to become thus bound, he cannot recover from the defendant, by reason of the elementary principle, that no man can make another his debtor without the consent of the latter. I have, then, to ask, where is the evidence of such a request ? I see none at all. And, in this, consists the difference between my brethren and myself. There is, unquestionably, no express evidence of a request to the plaintiff to give his, the plaintiff’s, warranty to the purchaser as to any quality of the clock. That is not pretended. But it is said that the plaintiff subjected himself to the action of Rhinchardt, upon a contract made by him for the defendant, which by his agency the defendant authorized him to make ; in other words, that by appointing an agent to sell a personal thing, not requiring a deed, a request is implied in law to the agent to give his warranty, as to the qualities of the article sold. For that position I know not of any authority whatever, ei> eepting only the opinion of my two brethren in this case. I admit, that, by the appointment of an agent to sell a personal chattel, an authority to war-rant is implied; but it is an authority to warrant in behalf and in the name of the 'principal. The dispute in the cases is, whether the agent had authority to bind the principal, where the agency was special, or there were instructions to the agent not to warrant. But in not one single case before this, that I have seen, was it ever contended, that from the appointing of an agent, not only an authority is implied to give the warranty of the principal of the goodness of the article,' but .also a request to the agent is to be inferred, to give his own warranty in lieu of the principal’s, or upon the back of it. I believe, if there was such a case, my brethren would have found it. At all events, none such has been cited by them. It is true, the case 'of Adamson v.. Jarvis, 4 Bing. 66, is relied on for this purpose. But I must say that it strikes me with much surprise that it should be. Not that I deny that case; for 1 think it good law, audit has been recognized by this Court in Ives v. Jones,,3 Ired. 538. But while I admit that case to be law, I am surprised that it should be adduced on this occasion; because it relates to a totally different subject. There, an auctioneer was requested by the defendant to sell certain goods as his property,, and he- did so, and paid the proceeds to the defendant, and then the owner recovered the value from the auctioneer, who. thereupon brought that suit to recover back what he had lost. Clearly, he recovered properly -r for the law implies a warranty of title from every vendor of personal chattels, and there was an express request from the defendant to the plaintiff^thcre, to do the act on which the plaintiff’s liability arose, namely, to sell the property as- the defendant’s ;. which amounted to a conversion as against the true owner, though an innocent one on the part of the agent Chief Justice Best, therefore, did not speak loosely, but well weighed his words, when he said, “ that every person who employs another to do an act,” (which is not unlawful,) “ undertakes to indemnify him for that act. The defendant there expressly “ employed the plaintiff t© do the act” he did, and no more nor less j and therefore the defendant was bound to assume the burden of all the consequences of that act.”' But how that is an authority to shew, that employing an agent to sell goods, and giving him power to make the sale with the warranty of the owner as to the qualities of the goods, amounted to an implied request to the agent to give his warranty as to the-qualities, I am at a loss to conceive- The case cited from Connecticut, cannot, I think, be law, It lays down this-doctrine — that if an ágen-t be sued on a contract made in the course of his agency, though the suit be without cause and he succeed in it, the principal is bound to refund all his expenses, and indebitatus assumpsit will lie for them. This is binding the principal for ail the wrongful suits other people may think proper to bring against one who has been his agent, for an alleged, and falsely alleged, injury by some act, done in the course of the-.agency. Even the most express covenant, that of quiet enjoyment for example, is by construction limited to wrongful disturbances, unless a particular person be expressly named. In the case of principal" and surety, if the principal pay the debt, and then the creditor sue the surety for it also, and the payment by the principal be established, so that there is judgment for the surety, cei’-tainly there is no ground for compelling the principal to reimburse the surety’s costs. It would be ruinous; for such groundless suit might be repeated over and over, and the principal by paying the debt, did all that ho contracted to do, or could be bound to do. But to return to tire case of Adamson v. Jarvis. The objection there, and in Betts Deems v. Gibbins, 2 Adol. & El. 57, was that the plaintiffs could not recover, because they were tort feasors, and therefore that the most direct request or promise of indemnity by the defendant, for the wrongful act, would not sustain the action. But here, the enquiry is, whether the plaintiff gave his warranty, 'on which Rhinehardt recovered, at the request of Jameson. There being no such express request, it is said that it is virtually included in the unrestricted agency to sell; be7 cause, from it “ the law implies a guaranty, or promise on the part of the principal to indemnify the agent from all the legal consequences that follow the sale.” Certainly, this last position, that a contract of indemnity is inferred against the consequences of making the sale, is perfectly right, because the agent was employed to make the sale. I should never think of gainsaying that. But what are the consequences to an agent from making the sale : what can they be? Why, only a liability to the owner (in case they were not the property of the principal) for the value of the things sold, either in trespass or trover, or an action for money had and received for the price, and that is all. In respect of the qualities of the things, the agent cannot.be liable at all from the sale merely. He can only be made liable by something in addition to the sale itself; by a fraud in misrepresenting the quality or concealing defects knowingly, or by his own engagement as to the quality. I think my brethren, when they say that from an agency to sell, the law implies a promise of the principal to indemnify the agent “ from all the legal consequences that follow from the sale,” cannot mean all their words import; for certainly for a fraud in making the sale, both principal and agent (as one of its legal consequences) would be liable to the purchaser, as wrong-doers ; and yet, between them, the law would enforce no promise of indemnity, nor contribution without a promise. Then, as to the remaining method by which an agent may become liable to suffer for a defect in the thing, as a consequence from the sale, which is, by annexing his own warranty to the sale, I must say, that my brethren have merely assumed or affirmed, that the law implies a counter guaranty from the principal, and have not sustained it by adjudged cases, nor proved it by argument. They say, indeed, that it would be unjust that the loss should fall on the agent instead of the principal, “ for whom and by whose authority he was acting.” But that seems to be plainly begging the question ; for, while it is admitted, that he is acting for, and by the authority of, the principal, in making the sale and giving the warranty of the principal — because to that extent there are many cases — yet it remains to be proved by some one case, that in giving his own warranty the agent was also acting by the authority, or at the request of the principal. Wherefore should the law imply, that the principal requested the agent to become his surety, that the articles were of good quality 1 How can it be so implied ? If such a request to an agent to sell shall be implied, why not imply also an authority to him to get a third person to give his warranty in aid, if the agent should happen to think it useful ? The one is just as much as the other within the scope of a mere authority to sell, which is all that is given in words. That implies, indeed, a power to warrant for the owner, but, as it seems to me, not to give the warranty of any body else. It is to be feared, that a notion of the justice of the case, as it is called, arising from the hardship of making the agent bear a loss, when he could not derive a profit from' lids- warranty,, may render us forgetful that ihe law requires, that there shall not only be a loss by one person for another, but also that such loss should be occasioned by some act done at the request of the other, before the latter will be bound to make the loss good.. It is not sufficient, that the agent should intend to promote the interest of his principal by giving his warrant)', unless it be at the instance of the principal. That consideration may move a generous mind to step forward in exoneration of the man,, who designed to befriend him- That is equally true of many other cases'of voluntary payments-for the benefit of others. But still there can be no recovery unless there has been a request. Upon this very question of principal and agent, this Court held, in one of the hardest cases that ever cam© before a Court of Justice, Hines v. Butler, 3 Ired. 307, where an agent knew Iris principal- was pressed for money, and, in order to raise it for him, he endorsed a-note, which be had to collect, or endorsed a note for a debtor of the principal for the purpose of getting it discounted at bank, and thereby the agent sustained loss, that the- principal was not bound to indemnify the agent, although,.as the Court expressly says, the agent “ did then believe h&was doing the best for the principal’s interest.” Why was that ? Because the principal had not given the agent authority to. endorse, but only to, collect the note, payable to the principal, and had not requested him to endorse the debtor’s note negotiable at bank. Therefore^ that loss from the officious acts of the agent, though with the very best intentions, in reference, as he thought, to the wishes and the interest of the principal, was thrown altogether upon the agent. How can this be distinguished. from that case ? Here the agent was authorized to give the warranty of the principal, and not his own, as in the other case he had power to collect the note, and not endorse it. Upon .the ground, then, that there was' no request, the action must fail in point of law. But it is extremely probable that it ought also to fail, in point of that sort of justice, which, it is supposed, may be on the plaintiff’s side. For how can we tell what might have been the result, if the plaintiff had not given his warranty to Rhinehardt, so that the latter would have been compelled to sue Jameson on his warranty ? In that case Hunter might have been called as a witness for Jameson, and might have proved, that he sold without giving a warranty of the principal as to the quality of the clock, or that in fact and truth the quality was such as was warranted. There was, doubtless, a real contest upon one or both of those points in Rhinehardt’s suit, as must be supposed from the pertinacious defence of it. A principal has a direct interest in the evidence, to that extent, of the agent, who is ever the most material witness to those points, as he best knows, what verbal contract he did make, and also is, probably, best acquainted with the properties of the thing sold- At all events, this interest of the principal in the evidence of the agent furnishes a strong reason, why the law should require direct evidence of a request to the agent, to give his own warranty, and not imply it, from the mere fact of agency; and as there is no adjudged case found, in which it has been implied, it is very conclusive to my mind, that it ought not, and cannot be implied,

[Per Curiam. Judgment affirmed.