Opinion
No. 34241.
November 11, 1940.
1. PRINCIPAL AND AGENT.
Where general authority of salesman is limited to soliciting and transmitting orders for goods to be shipped and delivered at a future date, burden is upon purchaser, who asserts the authority of the salesman to adjust account for purchase price, to prove that salesman has such authority.
2. PRINCIPAL AND AGENT.
The fact that a salesman, while making a call in such capacity, accepted from customer a check to be applied on an existing account, which was sent to seller by salesman to be so applied, did not of itself constitute salesman an "agent" of seller to collect the indebtedness, but rather purchaser made salesman his own "agent" to transmit the payment to the seller, in absence of showing that seller had authorized salesman to make the collection.
3. PRINCIPAL AND AGENT.
The authority of an agent to bind his principal rests upon powers conferred upon him by his principal.
4. PRINCIPAL AND AGENT.
Ordinarily, a selling agent is supposed to be employed to contract a sale, and has no implied power once contract is made, either to undo or to modify the contract.
5. PRINCIPAL AND AGENT.
Where store owner purchased sewing machines under a purchase order written by traveling salesman of sewing machine company, store owner subsequently gave salesman a check to apply on purchase price which was sent to company to be credited on the account, and thereafter salesman repossessed five of the machines when check went to protest, but never returned machines to company or otherwise accounted for them, proof of acceptance of check by salesman and sending it to company did not establish authority of salesman to reposses machines, so as to discharge liability of store owner for purchase price thereof, notwithstanding that machines were never returned to company or otherwise accounted for.
APPEAL from the circuit court of Winston county; HON. JNO. F. ALLEN, Judge.
W.A. Strong, Jr., and H.E. McCully, both of Louisville, for appellant.
A traveling salesman or drummer has no authority to bind his principal by repossessing equipment or making contracts.
Fairbanks-Morse v. Dale, 172 Miss. 271, 159 So. 859; McCaskey Register Co. v. Swor, 154 Miss. 396, 122 So. 489; Becker Co. v. Clardy, 96 Miss. 301, 51 So. 211; Cape County Sav. Bank v. Gwin-Lewis Grocery Co., 123 Miss. 443, 86 So. 275; Planters Lbr. Co. v. Sibley, 130 Miss. 26, 93 So. 440; Dahnke-Walker Milling Co. v. Phillips Sons, 117 Miss. 204, 78 So. 6.
One paying a traveling salesman or drummer makes this salesman the agent of the party paying.
Fairbanks-Morse v. Dale, 172 Miss. 271, 159 So. 859.
Approving the unauthorized act of a salesman on two occasions does not authorize the agent to make similar unauthorized contracts which would be binding on principal.
Wellford Withers v. Arnold, 162 Miss. 786, 140 So. 220.
If seller notifies purchaser that he will send agent to adjust the account with him, and the agent repossesses the equipment giving purchaser credit for same this is outside the scope of the agent's authority and not binding on the principal.
W.T. Rawleigh Co. v. Fortenberry, 148 Miss. 604, 114 So. 393.
Neither the fact of agency nor the scope and authority of the agent can be shown or proven by declarations of such alleged agent made out of court.
Postal Tel. Cable Co. v. Friedhof, 127 Miss. 498, 90 So. 182; Sumrall v. Kitselman, 101 Miss. 783, 58 So. 594; Reichman-Crosby Co. v. Dinwiddie, 117 Miss. 103, 77 So. 906; Gulfport Traction Co. v. Faulk, 118 Miss. 894, 80 So. 340; Rawleigh Co. v. Denham, 119 Miss. 409, 81 So. 118; Foye Tie Timber Co. v. Nicholas, 128 Miss. 709, 91 So. 395; Walter v. Stonewall Cotton Mill, 136 Miss. 361, 101 So. 495; McCaskey Register Co. v. Swor, 154 Miss. 396, 122 So. 489.
Rodgers Prisock, of Louisville, for appellee.
With reference to the point that an agent's statements alone cannot be used in testimony to prove the authority of the agent, we are fully in accord with this well settled rule of law, and are acquainted with the proposition that a "drummer" who takes orders to be accepted or rejected by the shipper, cannot bind the shipper by any statements, especially when the contract so states in its face.
If Mr. Taylor was simply a traveling salesman as the deposition of the appellant would have us believe, he could not have done anything except take orders, to be accepted or rejected by the home office. This is far from the truth. He had other things to do. That being true, the question arises, "What other things did this man do beside take orders?" One of the first things we find that he did do with the consent and approval of the New Home Sewing Machine Company, was to demand, accept, and transmit to the Company a collection, which was credited to the account of the defendant Moody, as shown by a letter received from the company and which is admitted and not denied.
Mr. Moody also knew that this man was more than just a "drummer." Did not this man go about over the country taking with him the machines of the New Home Sewing Machine Company, and giving demonstrations? Did he not have the very machine he sold? Did he not make the collections for the sales? Did he not deliver the machine he sold, without sending in an order to the company?
Let it therefore be said again we do not offer to prove the authority of this agent through his statements, but rather through his accepted acts and course of dealing, while he operated in this county, and they certainly prove that this man Taylor was more than a "drummer" or salesman who simply took orders for acceptance or rejection.
Fanning v. C.I.T. Corporation, 192 So. 41, 187 Miss. 45.
Where a principal has by his voluntary act placed an agent in such a situation that a person of ordinary prudence, conversant with business usages and the nature of the particular business, is justified in presuming that such agent has authority to perform a particular act, and therefore deals with the agent, the principal is estopped as against such third person from denying the agent's authority.
21 R.C.L. 907, Sec. 84.
The appellant in its brief raised the point that the act of Taylor was not ratified simply because he sent in a payment to the Home Sewing Machine Company, and cites the case of Wellford Withers v. Arnold, 162 Miss. 786, 140 So. 220. In that case it appears that a principal had on two occasions permitted an order to be charged to the account of its salesman, and the court held that this was not such a course of dealings as to permit any and every account to be charged to its saleman without notice to the principal, and the principal's consent. We do not think that case in point here. The case at bar is a case where the agent not only collected for the merchandise sold, but did other things, such as have in his possession for sale and did sell the appellant's articles, receive the money, and deliver the goods at the time of the sale, and make demonstrations to customers for the appellant.
The question of agency was a question of fact, and the jury found that the agent was acting for the appellant at the time he repossessed the machines he left on Moody's floor.
On August 18, 1938, the appellee purchased a number of sewing machines from the appellant, together with certain supplies therefor, under a written contract or purchase order delivered to B.E. Taylor, a traveling salesman, and thereby agreed to pay for said machines and supplies the sum of $493.88, with interest at six per cent per annum beginning sixty days from date of shipment. This purchase order was thereupon forwarded to the appellant, New Home Sewing Machine Company of Rockford, Illinois, by its said traveling salesman for approval and acceptance. The order was accepted and the shipment made from the factory of the appellant on August 23, 1938. Thereafter, the goods were duly received by the appellee and placed in his store at Louisville, Mississippi, for resale in the due course of business.
It appears that a few weeks later, on an occasion when the traveling salesman again called at the appellee's place of business, and in the same capacity in which he had called at the time he received the order for the machines in question, the appellee gave him a check on the purchase price of said machines for the sum of $180, payable to the appellant, and that the check was forwarded by the salesman to the payee thereof and duly credited on the account. This check went to protest, and the traveling salesman later returned to the appellee's store and repossessed five of the machines, but did not account therefor to the appellant. Upon the trial, it was shown by the deposition of the credit manager of the appellant sewing machine company that the traveling salesman had no authority to repossess these machines on its behalf, so as to relieve the appellee of the payment of any part of the purchase price thereof; and that the extent of the authority of the said traveling salesman was to solicit orders for the machines and transmit the same subject to the approval and acceptance of the appellant, and for which the salesman received a commission on the sales price. The purchase order, as signed by the appellee and delivered to such salesman, expressly stipulated that there were no agreements or understandings between the salesman and the purchaser not contained in the written order, and that any statement, agreement or understanding, oral or written, not contained in the purchase order, should not be binding on the appellant. The appellee, however, relied upon a subsequent oral understanding between himself and the traveling salesman at the time the machines were repossessed, and whereby the salesman stated, after the check heretofore mentioned had been protested, that he had instructions to call and take up the machines and "straighten out" the account. The authority of the salesman to repossess the machines, and the giving of any instructions in regard thereto was expressly denied by the appellant, and the appellee undertook to make proof of the salesman's authority by showing that the salesman came to the store and asserted that he had such authority, and exhibited some papers from the home office of the appellant, but which letter or papers the appellee did not read; nor did he know what they contained, except from what the salesman stated.
The testimony as to what the agent said out of court as to the fact of his agency and the extent of his authority in the premises was duly objected to, and the objection was overruled, the court below being of the opinion that the action of the salesman in receiving the check of $180 on the purchase price and sending it to the appellant to be credited on the account was sufficient to evidence the authority of the salesman as collector to adjust the account in the manner testified to. The peremptory instruction requested by appellant for the amount sued for was therefore refused, but judgment was rendered against the appellee for the amount sued for less $225 for the five machines which were repossessed by the salesman, and which were never returned to the appellant nor otherwise accounted for, as heretofore stated.
Where general authority of a salesman is limited to soliciting and transmitting orders for goods to be shipped and delivered at a future date, the burden is upon the purchaser, who asserts the authority of the salesman to adjust the account for the purchase price, to prove that the salesman has such authority. The mere fact that a salesman, while making a call in that capacity, may have accepted from the customer a check to be applied on an existing account, which is sent to the seller by the salesman to be so applied, does not of itself constitute the salesman an agent of the seller to collect the indebtedness. The purchaser makes him his own agent to transmit the payment to the seller, unless it is shown that the seller has authorized the salesman to call and make the collection. Fairbanks-Morse Co. et al. v. Dale Co., 172 Miss. 271, 159 So. 859. The seller had the right to accept appellee's check in its favor as payee when received at the home office and apply same on the account, without regard to whether it had been mailed to the seller by the appellee or by its own traveling salesman, on behalf of the appellee. Such action alone could not constitute any authority to the salesman to make any adjustment of the balance due or to repossess any part of the goods sold. W.T. Raleigh Company v. Fortenberry et al., 148 Miss. 604, 114 So. 393. In the case of Dahnke-Walker Milling Company v. T.J. Phillips Sons, 117 Miss. 204, 78 So. 6, 7, the court said:
"But it is said that the traveling salesman of appellant compromised or settled the claim which is the subject of this suit. It appears to be the settled law in all jurisdictions that the authority of the agent to bind his principal rests upon the powers conferred upon him by his principal. We think that it is fundamental that a selling agent, in the absence of evidence to the contrary, is not empowered to compromise.
"`Ordinarily such an agent is supposed to be employed to contract a sale, and has no implied power, once this is done, either to undo or to modify the contract.' 31 Cyc. 136, D."
It was also held in the case of McCaskey Register Company v. Swor et al., 154 Miss. 396, 122 So. 489, 490, 753, that: "Unless expressly authorized by his principal, a traveling salesman or `drummer' has authority only to solicit orders and transmit the same to his principal for approval. He cannot make an absolute contract of sale, and the authority of an agent cannot be proved by the mere statement of the agent. Becker Co. v. Clardy, 96 Miss. 301, 51 So. 211, Ann. Cas. 1912B, 355; Cape County Sav. Bank v. Gwin-Lewis Grocery Co., 123 Miss. 443, 86 So. 275." See, also, Wellford Withers v. Arnold, et al., 162 Miss. 786, 140 So. 220; Ammons v. Wilson Co., 176 Miss. 645, 170 So. 227.
Under the authorities above cited, the record fails to disclose that the salesman had authority to repossess any of the machines shipped by his employer to appellee, and discharge the liability for the purchase price thereof which had become fixed upon their delivery and acceptance.
We are therefore of the opinion that the peremptory instruction, on behalf of the appellant for the full amount sued for, plus six per cent interest for the period beginning sixty days from the date when the machines were shipped, should have been granted.
Reversed and judgment here for the appellant.