Opinion
No. 28320.
March 18, 1952.
APPEAL FROM THE ST. LOUIS CIRCUIT COURT, JOHN K. REGAN, J.
R. G. Church Jr., St. Louis, for appellants.
Greensfelder, Hemker Wiese, Forrest M. Hemker, and Mark R. Gale, all of St. Louis, for respondent.
This cause was instituted in the Magistrate Court of the City of St. Louis, Missouri, on January 16, 1950. Plaintiffs prayed for judgment against defendant in the amount of $968.78. On March 28, 1950, the respondent herein (defendant below) filed in the said Magistrate Court its offer of judgment wherein it offered to allow judgment to be taken against it in the amount of $373.70, such offer of judgment being filed in accordance with Laws of Mo. 1945, secs. 51 and 52, page 765, RSMo 1949, §§ 514.410 and 514.420, V.A.M.S. This offer was not accepted by plaintiffs and thereafter judgment was rendered in favor of plaintiffs for the full amount. An appeal by the defendant of the Circuit Court was perfected. In the Circuit Court a jury trial was waived and the case was heard by the court.
The only witness for the plaintiffs was Roy Werner who testified that plaintiffs were in the metalware fabrication business; that pursuant to conversations he had with Mr. Harwood of Welsh Company, written bids on the manufacture of two different size footwells for a baby stroller were submitted to defendant; that in each bid a price was given for a quantity run of 1000 pieces and another price for a quantity run of 20,000 pieces; that the price submitted for the 22 gauge steel footwells was at the rate of $2 each for 1000 hand made pieces and $0.93 each if as many as 20,000 were ordered; that the price submitted for the 26 gauge steel footwells was at the rate of $1.11 each for 1000 hand made pieces and $0.54 each if as many as 20,000 were ordered; that defendant sent its purchase order No. 3097 for five hundred 22 gauge steel footwells and that this purchase order contained the following: "To be billed at .93 ea. If no additional orders are forthcoming to be billed at $1.67 ea."; that these stroller footwells were delivered and accepted by the defendant; that the defendant never placed any further orders; that the defendant paid the bill at the rate of $0.93 each; that the defendant refused to pay the larger amount until the offer of judgment was made in the amount of $373.70, which was the difference between the $0.93 price and the $1.67 price charged for the 505 pieces delivered; that a second written purchase order No. 3678 of the defendant was received for 1000 of the smaller footwells; that the order showed a price of $0.54 each but said nothing about the price being $1.11 each if less than 20,000 were ordered; that upon receipt of this order he called Mr. Harwood, defendant's purchasing agent, and told him that a mistake had been made; that Mr. Harwood instructed him to change the ordered to read that, if 20,000 were not ordered, the price would be $1.11 and that Mr. Harwood stated he would change the defendant's copy of the order accordingly; that 1044 of these smaller footwells were furnished and accepted by the defendant; that the plaintiffs billed the defendant at the rate of $1.11 each but that defendant paid plaintiffs at the rate of $0.54 each and refused to pay the balance billed at the higher price amounting to $595.08; that the reason for the difference in price was that the smaller number had to be hand made which was costly and the larger number could be machine made and stamped out.
On cross-examination this witness further testified that he changed the price on order No. 3678 from $0.54 to $1.11 each after the conversation with Mr. Harwood; that he had no conversation with Mr. or Mrs. Welsh regarding the price of this item; that he knew nothing of the setup of the officers of the Welsh Company and that he knew that both orders had printed on the bottom of them: "No order valid unless signed by an officer of the firm," and that he didn't make any inquiry to see if he was dealing with an officer of the firm.
The only witness for the defendant was A. D. Welsh, president of defendant company, who testified that he and Mrs. M. D. Welsh were the only officers of the company and have been its only officers since 1929; that the initials appearing on orders No. 3097 and No. 3678 are those of Mrs. Welsh; that Harwood was never an officer of the company and never had authority to execute a purchase order; that the first time he knew that the price in the second order had been changed from $0.54 to $1.11 was when the litigation first came up; that he then looked at his duplicate office copy of the purchase order and found no change on it and that he didn't know that any change had been made on the plaintiffs' copy of the order; that he didn't know of any other price on the item covered by the second order than the $0.54 price; that Harwood was technically the company's purchasing agent with only the authority to go out and bring in bids for approval; that he had no authority to place an order; that he never placed an order during the time he was with the company and that no order had ever been placed without the approval of either Mr. or Mrs. Welsh and that Harwood had no authority to tell the plaintiffs to change the price on the order.
The trial court entered the following finding and judgment: "Finding and judgment for plaintiff in the sum of $373.70 and costs to March 28, 1950, the date of defendant's offer of judgment. Judgment for defendant on remainder of plaintiff's cause of action and costs against plaintiff from March 28, 1950."
No findings of fact or declarations of law were asked or given and the trial court did not indicate the ground or grounds upon which it predicated its finding and judgment. From this finding and judgment plaintiffs appealed.
Appellants contend that respondent placed Harwood in a position of apparent authority to make the price change in the second purchase order received and that they were entitled to rely on that apparent authority. Respondent, neither admitting nor denying the alleged conversation of Werner with Harwood, contends that the doctrine of apparent authority is not applicable in this case, for the reason that it clearly notified appellants that it would be bound only by the acts of its officers and that Harwood was not an officer and had no authority to change the price on the order in question. Respondent also contends that in this action, a jury trial having been waived, it was the province of the trial court to pass upon the credibility of witnesses; that the court was not required to believe Werner's testimony even if it was not impeached or contradicted, and, that no findings of fact or declarations of law having been given or asked, the judgment of the trial court is practically impregnable if there is any theory upon which it can reasonably be based.
Answering the last mentioned contention of respondent, this court will review the case, an action at law tried without a jury, upon both the law and the evidence as in suits of an equitable nature. The judgment will not be set aside unless clearly erroneous, and due regard will be given to the opportunity of the trial court to judge of the credibility of the witnesses. Subsection (d), Section 114, Civil Code of Missouri, Laws of Missouri 1943, p. 388; RSMo 1949, Subsection (4), Section 510.310, V.A.M.S., Cosentino v. Heffelfinger, 360 Mo. 535, 229 S.W.2d 546. However, in view of the conclusion we have reached in this case, it makes no difference what credibility the trial court gave to the testimony of Werner.
In support of their contention that respondent placed Harwood in a position of apparent authority to make the price change, appellants cite the following cases: Miltenberger v. Hulett, 188 Mo.App. 273, 175 S.W. 111, Thornhill v. Masucci et al., 202 Mo.App. 357, 216 S.W. 819, and Wind v. Bank of Maplewood Trust Co., Mo. App., 58 S.W.2d 332. These cases deal with and invoke the general rule that the principal is bound by the acts of his agent when he has placed the agent in such a position that persons of ordinary prudence, reasonably conversant with business usages and customs, are thereby led to believe and assume that the agent is possessed of certain authority and that they may deal with him in reliance on such assumption. No one can question the principle of law that such acts and contracts of an agent as are within the apparent scope of the authority conferred on him, although no express or direct authority to do such acts or to make such contracts has been conferred, are also binding upon the principal. Respondent insists that these cases and the rule invoked in them do not govern this case and with this insistence we agree.
The testimony of Werner shows that at the time he had the conversation with Harwood about the change in price on order No. 3678 he knew of the statement printed on the bottom of the order that no order was valid unless signed by an officer of the defendant corporation. Werner knew that the initials of the officer signing the order were not those of Harwood. He made no attempt to ascertain if Harwood was an officer. We hold that there was sufficient notice of the limitation of Harwood's authority. Only an officer of the defendant could change the price on this order. It is always competent for a principal to limit the authority of an agent and if such limitations are brought to the attention of the party with whom the agent is dealing, the power to bind the principal must be found within the limited authority of the agent.
In Distassio v. American United Life Insurance Co., 238 Mo.App. 279, loc. cit. 283, 179 S.W.2d 610, loc. cit. 612, it is said: "It follows that if the third party had actual or constructive knowledge of restrictions and limitations on the authority of the general agent, then they must contract with him with those restrictions and limitations in mind and cannot blindly rely on his apparent authority." In the Distassio case, in support of its holding the court quoted from Slocum v. New York Life Ins. Co., 228 U.S. 364, 33 S.Ct. 523, loc. cit. 527, 57 L.Ed. 879, loc. cit. 885, Ann.Cas. 1914D, 1029, wherein it was said: "One who deals with an agent, knowing that he is clothed with a circumscribed authority and that his act transcends his powers, cannot hold his principal; and this is true whether the agent is a general or a special one, for a principal may limit the authority of one as well as of the other."
In Curtiss Candy Co. v. National Finance Corp., 228 Mo.App. 609, 71 S.W.2d 833, cited in respondent's brief, the defendant was engaged in the business of handling delinquent accounts, notes and judgments for creditors against debtors. Plaintiff and defendant entered into a written contract, by which plaintiff, for a consideration, would be entitled to the adjustment and collection service afforded by defendant. The written contract required the plaintiff to submit the "known addresses" of the various debtors. The contract was upon a printed form furnished by the defendant, and it was printed therein that all obligations of the defendant were stated therein and no representative had any authority to make any agreement or "to alter said contract." Plaintiff contended that it signed said contract relying on a statement made by defendant's representative that, in submitting the addresses of the various debtors, it would be all right to submit the "last known addresses." The court in its opinion, 71 S.W.2d loc. cit. 837, said: "That he (defendant's representative) had such authority is negative by the original contract itself which provides that all obligations of the corporation are stated therein and that no representative has authority to make any agreement or to alter it. Respondent was thus placed upon its guard. It could not further proceed upon any theory of the representative's apparent authority to make or modify such contract." (Parenthesis ours.) To the same effect is Barnsdall Refining Corp. v. Birnamwood Oil Co., 7 Cir., 92 F.2d 817.
It is our opinion that plaintiffs were clearly notified that Harwood had no authority to change the price in the order and we so hold.
We do not find the trial court's judgment to be erroneous. The judgment should be affirmed and it is so ordered.
BENNICK, P. J., and ANDERSON, J., concur.