Opinion
No. 41930.
September 25, 1961.
1. Contracts — rental of equipment — principal and agent — existence of contract, agency, and agent's implied authority to make contract were question for jury.
Whether prime contractor on government project promised equipment owners it would pay rental for equipment and, in reliance on that promise, equipment owners unloaded equipment, and whether person who made alleged representation was prime contractor's superior representative on project and had implied authority to make contract, were jury questions.
2. Contracts — rental of equipment — question of equipment owners' honest belief as to identity of contracting party renting equipment was for jury.
Whether owners of equipment did not know that men with whom they discussed rental of equipment represented subcontractor and believed that they were renting equipment to prime contractor were jury questions.
3. Frauds, statute of — debt of another — contracts — rental of equipment — nonexistence of primary obligation — promise to pay rental not unenforceable under statute of frauds.
Where jury found that equipment owners did not know that men with whom they discussed rental of equipment represented subcontractor, but thought they were renting equipment to prime contractor and consigned it to prime contractor, prime contractor's subsequent promise to pay rental was not unenforceable under statute of frauds. Sec. 264(a), Code 1942.
4. Frauds, statute of — debt of another — no promise is within statute unless there is obligation of third person to promisee.
Promise is not within statute of frauds clause, as to promise to answer for debt of another, unless there is obligation of third person to promisee. Sec. 264(a), Code 1942.
5. Contracts — rental of equipment — owners of equipment not estopped from asserting contract with prime contractor and from denying primary obligation of subcontractor for rental.
Where rights of equipment owners and prime contractor had become fixed under rental contract, fact that one of owners of equipment and another worker operated equipment and were paid therefor by subcontractor and that equipment owners at direction of prime contractor's agent submitted bill for rental to subcontractor did not estop equipment owners from asserting contract with prime contractor and from denying primary obligation of subcontractor for rental. Sec. 264(a), Code 1942.
Headnotes as approved by Ethridge, J.
APPEAL from the Circuit Court of Jackson County; LESLIE B. GRANT, J.
Mize, Thompson Mize, Gulfport, for appellant.
I. Was any representative of General Electric Company at Keesler Air Force Base such an agent, and clothed with authority to bind General Electric Company? Aetna Ins. Co. v. Singleton, 174 Miss. 556, 164 So. 13; Cue Oil Co. v. Fornea, 208 Miss. 810, 45 So.2d 597; Gilchrist v. Pearson, 70 Miss. 351, 12 So. 333; Hamilton v. Federal Land Bank of New Orleans, 161 Miss. 743, 138 So. 352; King v. Levy (Miss.), 13 So. 282; Pan American Petroleum v. Bardwell, 203 Miss. 833, 33 So.2d 451; Stilling v. Illinois Cent. R. Co., 209 Miss. 414, 47 So.2d 840; Sec. 264, Code 1942.
II. Was the purported agreement within the statute of frauds? Harris v. Griffin, 226 Miss. 74, 83 So.2d 765; Sweatman v. Parker, 49 Miss. 19; Wade v. Long, 168 Miss. 434, 151 So. 564.
Karl Wiesenberg, Pascagoula, for appellees.
I. The question of the authority of the agent of the appellant was not raised by the appellant in the court below.
II. This Court cannot be required to pass on an issue which was not raised in the court below nor submitted to the jury on appropriate instructions.
III. The question of the authority of an agent is a jury question to be determined under proper instruction, and as noted, this issue was not submitted to the jury by the appellant. King v. Levy (Miss.), 13 So. 282; 2 Am. Jur. 360.
IV. The main contention made by appellant on this appeal is that this case is controlled by the statute of frauds (Section 264(a), Mississippi Code of 1942) and that the appellees are attempting to recover on a promise made by an agent of General Electric Company to pay for the debt of the Autrey Construction Company. This contention was the only issue raised by the appellant in the court below. On conflicting evidence the court below, on appropriate instructions, submitted this issue to a jury, who found for the appellees. Benson v. Berry-Dampeer Co., 158 Miss. 230, 130 So. 157; Rotenberry v. Quitman County Farmers Assn., 238 Miss. 867, 120 So.2d 566.
V. Appellant did not specially plead the statute of frauds, which is an affirmative defense and which, under the statute, he was required to plead. Calvert Fire Ins. Co. v. Swain, 217 Miss. 773, 65 So.2d 253; Greer v. Crawford Corp., 220 Miss. 97, 70 So.2d 69; Sec. 1475.5, Code 1942.
VI. The appellant is estopped to deny its liability to appellee. Hall v. Box, 131 Miss. 218, 94 So. 221; Harper Foundry Machine Co. v. Cammack (Miss.), 57 So.2d 490; Railway Express Agency v. Bank of Philadelphia, 168 Miss. 279, 150 So. 525.
Appellees, Hans and Sheldon, brought this action in the Circuit Court of Jackson County against appellant, General Electric Company (GE), to recover on an oral contract for the rental of a two and one-half yard dragline. The issues, existence of contract, agency, and nonexistence of primary obligation, were submitted to a jury which returned a verdict for plaintiff, and judgment was rendered on it.
General Electric was the prime contractor on a Federal Government project at the Keesler Air Force Base in Biloxi. Appellees' dragline was used on that project for two weeks. It performed the job properly, and there is no dispute about the amount of the rental. The question is who is liable for it.
General Electric subcontracted the work to Almond Electric Company, who in turn subcontracted part of it, including dragline operations, to Jack Autrey. Plaintiff's evidence, accepted by the jury on proper instructions, showed that they had the dragline consigned to GE at the air base, and, when it arrived, GE's agent advised them it should have been consigned to Autrey, who had the subcontract. Sheldon refused to unload it unless General Electric would guarantee he would get his money for the job. He did not know Autrey. Hathaway, GE's installation supervisor of this project, told him to go ahead and unload, that GE would assure him of the payment. Following that promise, Sheldon had the dragline unloaded and operated it on the job.
(Hn 1) On conflicting evidence, the jury was warranted in finding that appellant's agent promised appellees it would pay the rental, and in reliance on that promise, appellees unloaded the dragline and used it; that Hathaway was General Electric's superior representative on this project, and he had the implied authority to make this contract.
Defendant contends, however, that this agreement falls within the statute of frauds, Miss. Code 1942, Rec., Sec. 264(a), being a promise to answer for the debt of another person, and therefore the agreement is unenforceable. Assuming defendant adequately raised this issue, we do not think it is valid, because the jury could find there was no primary obligation of another, which is necessary to bring Sheldon's agreement with GE within the statute of frauds.
Several days before the dragline was shipped to the air force base, Sheldon and Hans met with Keto and Faulks in Biloxi. The latter in fact were representatives of the second subcontractor, Autrey, but Sheldon and Hans were not so advised by these men. They were under the impression that the rental of the dragline was to be made to GE. This is supported by the fact that the machine was consigned to GE. When it arrived at the air base, Sheldon was told the consignment should be corrected to show Autrey rather than GE. In the meantime, however, Sheldon had the conversation with Hathaway, in which he promised to see that the rental was paid. (Hn 2) Appellant asserts there was an original, primary contract with Autrey through its agents Keto and Faulk. Manifestly the jury concluded that Sheldon and Hans did not know these men represented Autrey, and did not make any agreement with Autrey through them for the rental; that they thought they were renting it to GE and consigned it to that company. The first and only contract of rental, therefore, occurred and was with General Electric through its agent, Hathaway.
(Hn 3) Hence there was no primary obligation of another person prior to Hathaway's agreement for appellant to pay the rental. It is essential that a primary obligation of some kind be incurred in order to bring the case within the statute. No question of the statute of frauds can arise where a promise is made by one if there is no primary obligation. 2 Williston, Contracts (Rev. Ed. 1936), Sec. 454. (Hn 4) A promise is not within this clause of the statute unless there is an obligation of some third person to the promisee. The third person must at some time be under a legal duty of performance to the promisee, a duty that will be discharged by the performance of the new promisor. 2 Corbin, Contracts (1950), Sec. 349.
(Hn 5) The rights of the parties were fixed as of the time of the agreement between Sheldon and Hathaway as GE's project supervisor. The facts that subsequently Sheldon and another worker operated the dragline and were paid wages for that by Autrey, and that appellees on Hathaway's direction submitted a bill to Autrey and were given by Autrey an invalid check for part of the rental, do not estop them from asserting a contract with General Electric and from denying any primary obligation of Autrey.
Affirmed.
McGehee, C.J., and Arrington, McElroy and Rodgers, JJ., Concur.