Opinion
No. 7054.
July 11, 1952. Rehearing Denied August 11, 1952.
APPEAL FROM THE STODDARD COUNTY CIRCUIT COURT, STODDARD COUNTY, K. W. BLOMEYER, SPECIAL JUDGE.
J. Grant Frye and Gerald B. Rowan, Cape Girardeau, for appellant.
C. A. Powell, Dexter, for respondent.
The original petition was filed July 3, 1941. The regular judge was disqualified and Honorable K. W. Blomeyer was named as special judge of the Stoddard County Circuit Court. The case has been in this Court before. On February 7, 1951, McDowell, Judge, of this Court, wrote an opinion, concurred in by Vandeventer, Presiding Judge of this court, and by the writer. That opinion is reported in J. R. Watkins Co. v. Baker, 236 S.W.2d at page 745. The trial court then had refused to permit plaintiff therein to amend its petition and made an order dismissing the case. This Court held that such amendment was permissible and reversed the judgment entered in that case and the case went back to Stoddard County for trial on the merits. In the present case plaintiff was permitted to amend the petition which had formerly been denied.
Mr. Powell, attorney for defendant Sanders, asked the trial court to permit amendment of the separate answer of defendant Baker to plead that this action was outlawed by Section 516.120, Revised Statutes of Missouri for 1949, V.A.M.S. Before discussing the merits of the case, we pause to consider that contention. While the case was not tried on its merits, within a period of five years from the date of the alleged contract between plaintiff and defendants, suit was filed on such contract in a little over two years from the time it was alleged to have been made.
The case was kept alive by the appeal denied by this Court. The delay between the dates the first appeal was decided and the time the case was tried on the merits does not appear; but the original petition was filed on July 3, 1941, and trial thereon cannot be and is not now barred by Section 516.120, RSMo 1949, V.A.M.S.
The case now before us is on the merits. The petition alleged that appellant, to whom we will hereafter refer as plaintiff, sold and delivered to defendant John Baker, between March 28, 1939, and March 11, 1940, goods and merchandise amounting to $1,112.50, on which amount only $472.16 had been paid, leaving a balance alleged to be due to plaintiff of $640.34, and 6% interest thereon from May 28, 1940. The last sale was in March, 1940, but the petition only asked interest from May 28, 1940. For such balance plaintiff asked judgment against the defendants John Baker, Louis Wilkerson, J. L. Lankford and T. J. Sanders, with interest from May 28, 1940. Defendant Wilkerson was not served with process.
A jury trial resulted in the following verdict:
"We, the jury, find the issues herein in favor of the plaintiff and against the defendant John Baker, in the sum of $640.34 without interest Dollars, and in favor of Defendants John Lankford and T. J. Sanders."
Not being satisfied with the judgment which was rendered on such verdict, plaintiff filed a motion for new trial. That motion pended, without action thereon, for more than 90 days and was overruled by operation of law. Section 510.360 RSMo 1949, V.A.M.S. Plaintiff has appealed. Time for the preparation and filing of the transcript was extended by the trial court and the case is thus before us.
Accompanying the petition was an itemized statement of goods and merchandise sold and delivered by plaintiff to defendant Baker. To the petition also was attached a copy of the alleged agreement between plaintiff and defendants Baker, Wilkerson, Lankford and Sanders. Such petition concluded with the following:
" * * * in consideration of the execution of the said agreement and contract by the plaintiff the defendants Louis Wilkerson, J. L. Lankford and T. J. Sanders, did by said contract and agreement jointly, severally and conditionally, promise, agree and guarantee to pay for said goods and other articles, and the prepaid transportation charges thereon, at the time and place, and in the manner in the agreement provided. * * *."
Defendants Lankford, Sanders and Baker filed separate answers to which plaintiff filed a general denial. The points raised by such separate answers will be discussed later. Only defendant Sanders has resisted plaintiff's appeal, and a brief for such defendant is on file, in addition to the brief for plaintiff. The case was submitted to this Court at Poplar Bluff on briefs without argument.
In its brief, plaintiff raised six points and makes an elaborate statement as to what it claims were the facts in the case. In his brief, defendant Sanders adopts the statement of facts of the plaintiff, except in certain respects. He then proceeds to point out in what respects the statement of plaintiff is inaccurate.
As we have no doubt that the petition stated a cause of action against defendants, we will confine ourselves largely to such alleged inaccuracies. Proof for plaintiff consisted entirely of depositions of witnesses taken in Winona, Minnesota, on November 26, 1943. At the taking of those depositions, plaintiff was represented by counsel. Defendants did not appear thereat, either in person or by counsel. No question is raised as to the propriety of the admission in evidence of such depositions.
J.M. Henry was the first witness produced by plaintiff at such depositions. While the testimony of that witness leaves the impression with us that he had often testified or had been thoroughly couched, we see no reason to question the truth of his testimony.
The total amount of the goods and merchandise sent to defendant Baker by plaintiff was $1,112.50, of which defendant Baker had paid $472.16, leaving a balance still due from defendant Baker of $640.34.
The witness Henry identified exhibits 51 to 60, both inclusive, as statements from defendant Baker and testified to a demand on Louis Wilkerson and defendants Lankford and Sanders, after the original contract had expired.
Defendant Baker ordered the goods and merchandise shown by plaintiff in Exhibits 9 to 42, both inclusive, most of which were sent to defendant Baker by railroad carrier, and some few by mail or by express. None of the bills for goods and merchandise was returned to plaintiff from defendant Baker.
The agreement alleged to have been made, bound Louis Wilkerson and defendants Baker, Lankford and Sanders to pay for any goods or merchandise, delivered by plaintiff to defendant Baker, for which defendant Baker did not pay. Defendants Lankford and Sanders, either by their pleadings or in their testimony, admitted that they had signed the agreement attached to the petition.
As authority against all defendants served with process and in court, plaintiff cites General Motors Acceptance Corporation v. Holland, Mo.App., 30 S.W.2d 1087, 1089. The opinion in that case was written by Bailey, Judge of this Court, and was concurred in by Cox, Presiding Judge, and Smith, J. The jury in that case had rendered a verdict for defendant, and the judgment was reversed and the cause remanded.
That was a suit to compel defendant therein to pay the amount still due from such defendant's granddaughter, on an automobile purchased by the granddaughter, and partially paid for by said granddaughter. Defendant, an old woman, had signed an agreement to pay the portion of the purchase contract which the granddaughter did not pay. The jury had found for the grandmother and its verdict was set aside and the case was reversed and remanded.
While this Court in that case did not direct the trial court to enter a judgment for plaintiff, it held that the defense offered by defendant would not excuse the grandmother from making the payments she had agreed to make in the contract pleaded and proven. Defendant had testified that one Allen was the agent of plaintiff and in order to collect his commission for such sale from plaintiff, he had signed an agreement with defendant that defendant never would be held responsible for the debt to plaintiff of her said grandchild. Judge Bailey said:
"We therefore do not consider plaintiff bound by such acts and conduct of the Allen Motor Company, or its agent, C. H. Allen, and defendant cannot thereby escape liability, even though her signature may have been procured by fraudulent representations of Allen."
Judge Bailey then quoted from 28 C.J. 927, Section 66-b, the following:
"`While the law requires the guarantee to act in good faith, unless he has knowledge of or participates therein, he is not responsible for any misrepresentation or deception practiced by the principal, or other third person, upon the guarantor in order to induce him to enter into the contract of guaranty.'" See, also, 38 C.J.S., Guaranty, § 32.
We think all of Section 66-b, in 28 C.J., page 927, is worth repeating here, even at the expense of unduly lengthening this opinion, and we set out more of such section than did Judge Bailey, as follows:
"While the law requires the guarantee to act in good faith, unless he has knowledge of or participates therein, he is not responsible for any misrepresentation or deception practiced by the principal, or other third person, upon the guarantor in order to induce him to enter into the contract of guaranty. But if the guarantee participates in false representations or fraudulent concealment of facts which operate to induce the making of a contract of guaranty, the guarantor may set up such fraud as a defense in an action upon the guaranty." See, also, 38 C.J.S., Guaranty, § 32.
In his deposition witness Henry testified that Paul Corbin was not then and had not been in the employ of plaintiff in any capacity whatever. Even though Paul Corbin represented himself to defendants as having some connection with plaintiff, such fact, if a fact, cannot be proven solely by the statements of said Paul Corbin, testified to in defendant's evidence.
In State ex rel. Massman v. Bland, 355 Mo. 17, 194 S.W.2d 42, 45, the Supreme Court said:
"The general rule is well settled that neither the fact nor scope of agency can be established by the mere out of court declarations of the alleged agent."
That case cited State ex rel. Kurz v. Bland, 333 Mo. 941, 64 S.W.2d 638; Mechanics' American Nat. Bank v. Rowell, Mo.Sup., 182 S.W. 989; and C.I.T. Corporation v. Hume, Mo.App., 48 S.W.2d 154. We have read those cases and they fully support the rule laid down.
There is no proof in this case, outside of the alleged declarations of Paul Corbin himself, that had the slightest tendency to prove that said Corbin was in any respect the agent of plaintiff.
Many witnesses were introduced by the defense to prove that Corbin had claimed to represent the plaintiff. Not only were such statements inadmissible to show such agency, because made by the alleged agent; but an examination of the testimony of those witnesses shows that such alleged statements were made on other occasions and had no connection whatever with the alleged statements of Corbin in this case.
There is no proof that plaintiff had any knowledge of the alleged statements of Corbin to defendant Baker, and other defendants. The only proof was that Corbin himself was under a contract with plaintiff somewhat similar, if not entirely similar, to the contract of defendant Baker. Said Corbin was not authorized to tell defendant Baker that he could get a position as agent for plaintiff.
Said Henry also denied telling defendants Lankford or Sanders that they were only signing a recommendation for defendant Baker. There was no testimony that such statement was made by plaintiff to defendant Lankford or to defendant Sanders. According to the proof, plaintiff had nothing whatever to do with defendant Lankford or defendant Sanders, except the signing of the agreement for defendant Baker. According to witness Henry, the first plaintiff knew that the names of such witnesses were signed to the contract was when Baker's agreement was presented to plaintiff, with the names of such witnesses thereon.
Plaintiff had no knowledge that defendants Lankford or Sanders considered themselves as mere recommendants and did not consider themselves as sureties for defendant Baker. According to witness Henry, the first knowledge plaintiff had of such claim was when the contract with defendant Baker expired and plaintiff was seeking to collect from defendants.
Witness Henry said that plaintiff offered prizes to customers for procuring other new customers. If there were no new customers, there was no prize paid by plaintiff. He testified that plaintiff simply made such an offer to Paul Corbin. According to such witness, Paul Corbin sustained no other relation whatever to plaintiff. Defendant Baker informed plaintiff that Corbin had interested him and the plaintiff gave Corbin a cash prize for interesting Baker. When orders were made by Baker, plaintiff gave Paul Corbin some more money.
Witness Henry further testified in his deposition that plaintiff gave no instructions to defendant Baker relative to the sale of merchandise sent to him for sale. He said that plaintiff also sent some merchandise to defendant Baker to be used by him in advertising. The invoices indicated that plaintiff did not direct to whom such free merchandise should go.
In his deposition, witness Henry testified that plaintiff gave no directions to defendant Baker as to disposal of other merchandise and had not fixed the retail prices thereof.
Witness Henry also testified that plaintiff made no suggestions to defendant Baker as to miscellaneous or promiscuous credit to Baker's customers. He said plaintiff made no suggestions as to the payment to the defendant Baker as to the time his customers should pay him for such merchandise. He testified that defendant Baker was not required to sell on credit at all, if he did not wish to do so, and plaintiff, according to witness Henry, had no control over merchandise sold to defendant Baker, or any control over defendant Baker himself.
Witness Henry was advised of defendant's fire. When first so advised defendant Baker said that he had saved all of plaintiff's products. That was before plaintiff attempted to collect from defendant Baker and the other defendants. He said that he had never heard of a $250 loss of goods until this suit was commenced. Witness said that those goods were the property of defendant Baker at the time of the alleged fire.
The second witness produced by plaintiff at such depositions, was H. J. Greene. Greene said that he had been manager of the contract department of plaintiff since 1932. He identified the contract between defendant Baker and plaintiff and told how the contract was prepared and sent to defendant Baker. His evidence largely covered the same ground as was covered by witness Henry, particularly the alleged connection of Paul Corbin with plaintiff.
The third witness produced by plaintiff at such depositions, was one W. M. Bright, who said he was general rural sales manager for plaintiff. His testimony agreed largely with the testimony of witness Henry, set out so extensively above, except as the dealings with defendant Baker were confined to his department. He denied any authority in Paul Corbin. He said he gave no instructions to defendant Baker as to how such goods and merchandise should be disposed of by him. He said that plaintiff made no recommendation to defendant Baker as to extending credit promiscuously. He admitted that defendant Baker was told that he might extend reasonable credit to responsible purchasers for a time. He said that this extension of credit was left entirely to defendant Baker.
Such witness also testified that in December, 1939, defendant Baker had written plaintiff that a fire had destroyed his home; but that he had been able to save all of the products purchased from plaintiff. He testified that he did not learn of the claim that defendant Baker had lost products of the approximate value of $250, until claim was made by plaintiff.
H. C. Lohse was the fourth witness called by plaintiff at such depositions. He said he was in charge of plaintiff's billing department. His testimony was quite brief and was similar to that of plaintiff's previous witnesses and dealt mostly with receipt of orders for goods and merchandise from defendant Baker and prices therefor.
The last witness called at such depositions by plaintiff was E. J. Sievers. His testimony was also quite brief. He was assistant to plaintiff's comptroller and, so far as his testimony went, it was quite similar to that of witness Henry and others.
At the trial in the Circuit Court the foregoing depositions and exhibits were offered by plaintiff as its testimony in the case.
As above stated, plaintiff was represented by counsel at the taking of such depositions and none of the defendants, and none of their counsel, was present thereat. The testimony of such witnesses seems to have been clear and well coached and a good many of the questions asked of such witnesses were probably leading and suggestive and frequently called for the conclusions of such witnesses. Such questions, in the form asked, possibly would not have been asked by plaintiff's counsel, had defendants been represented at the taking of such depositions. As no objections were made or could have been made, to such questions the defendants cannot now object thereto. 64 C.J., Section 190, page 168; Clark v. Crandall, 319 Mo. 87, 5 S.W.2d 383, loc. cit. 386.
Defendants' criticism of instructions No. D-1 and No. D-4, is covered by what has been said as to Points I and II of defendants' brief.
The defenses raised by the separate answers of defendants Lankford and Sanders are in the face of the rule quoted and are without any competent evidence whatever. The facts alleged to constitute such defenses, were also disproved by the testimony of plaintiff's witnesses. There is no proof whatever that plaintiff fraudulently or deliberately induced defendants Sanders and Lankford to sign the contract.
We have carefully gone over the testimony of S.E. Walker, John Baker, Dr. Poe, Joe Bess, Leslie Williams, Frank Sanders and William J. Warren, offered by defendants. Most of those witnesses testified to other transactions, which were not connected with the contract sued on, and consisted entirely of statements of Paul Corbin, which clearly could not be used to establish his agency. Paul Corbin did not testify as a witness.
While this is rather a peculiar case, the principles of law are the same as if defendant Baker had gone to a bank to borrow money and the careful banker had required him to get other persons to sign with him as sureties.
The verdict in this case was in face of the competent evidence. The jury found that defendant Baker owed plaintiff $640.34, the amount for which plaintiff had sued, but that Baker was not liable for interest thereon, and at the same time it found for defendants John Lankford and P. J. Sanders.
There was no admissible evidence that Paul Corbin represented plaintiff in any way and the verdict should have been for plaintiff against all of such defendants in court, with interest at 6%, from May 28, 1940, as prayed in the petition. We think that the jury should have found accordingly, and direct the Circuit Court, upon remandment, to enter judgment in favor of plaintiff against defendants Baker, Lankford and Sanders, in the sum of $640.34, with interest thereon at 6% from May 28, 1940.
We therefore direct that such a verdict, with judgment thereon, shall be entered by the trial court, without further trial of the case.
It is so ordered.
VANDEVENTER, P. J., and McDOWELL, J., concur.