Opinion
December 13, 1948.
1. Sales — evidence — presumptive effect prima facie of failure to introduce bill of sale.
When a material issue is whether the sale of personal property belonging to a corporation was made by the president of the corporation acting individually or whether acting for the corporation and it is shown by the record that the bill of sale was handed to counsel for plaintiff, who had the burden of proof, and he failed to introduce it, the court is entitled to assume that the bill of sale was executed in the name of the corporation.
2. Sales — manner and amount of payment of purchase price — undisputed evidence, effect of.
When the personal property has been delivered to the purchaser and his undisputed testimony as to the amount of the payment of the purchase price and the manner thereof is reasonable under all the circumstances, his reasonable version, being undisputed, must be accepted thereby leaving no issue in respect to it to be submitted to a jury.
3. Sales — statements by outsider as to the property involved.
Statements to the purchaser by the keeper of the garage where the property was stored and by a police officer both of whom assumed to know, to the effect that the property was for sale and that the president of the owner corporation had charge of it for that purpose, while not binding on the owner were competent as going to the good faith of the purchaser in buying the property from the president who assumed to act for the corporation. And the fact that the garage keeper, who had no connection with the corporation other than a bailee for hire, knew that the property was encumbered by an unrecorded deed of trust, and did not tell the prospective purchaser of that fact, did not bind or affect the purchaser, he having no knowledge of the deed of trust, nor any knowledge sufficient to put him on notice.
4. Corporations — sale of corporate personal property by president — apparent authority.
When the principal business office of a foreign corporation was located at a point in this state and the only officer present in the state and in charge of the office was the president, the latter by the by-laws being "the chief executive officer of the corporation . . . to have the general and active management of the business of the corporation," a sale by the president acting for the corporation of certain personal property of the corporation presently situated at or near the said principal office and which was apparently not held or to be used by the corporation for any business purpose other than for sale, and the purchaser had no knowledge or reasonable means of knowledge to the contrary, will be held valid when the property has been delivered to the purchaser for an adequate consideration paid in cash to the president.
Headnotes as approved by McGehee, J.
APPEAL from the circuit court of Harrison County; L.C. CORBAN, J.
Mize, Thompson Mize and Jo Drake Arrington, for appellant.
The evidence adduced by plaintiff not only tends to show, but overwhelmingly shows, that the alleged sale of the property to the defendant was made fraudulently and without authority. The purported sale was made by William Marsalis, president of the Marsalis Construction Company, Inc., to Marco Skrmetti the defendant. But a president of a corporation has no authority merely by virtue of his office to effect a sale of its real or personal property. 13 Am. Jur. 882, Corporations, section 904; 19 C.J.S. 533, Corporations, section 1038, Subdiv. c.
The evidence shows that William Marsalis, as president of the corporation, had no authority whatever, from the directors or otherwise, to sell the property to the defendant. To have made a valid sale, he must have had such authority, either actual or implied; but he had neither. Luquire Funeral Homes Insurance Company v. Turner, 176 So. (Ala.) 536.
The defendant testified that he received a bill of sale but such alleged bill of sale is not in evidence. And the defendant admitted that his alleged bill of sale was undated.
The fact that such bill of sale was undated is a significant fact in this case, because the defendant testified that he purchased the property "around April 1," 1947, and because the plaintiff shows that as late as April 29th, 1947, the property still had not been delivered to the defendant, and because the chattel mortgage in which the plaintiff was appointed trustee was filed for record in Harrison County on April 15, 1947.
The defendant, Marco Skrmetti, as an adverse witness, actually stated in open court that "around April 1," he first met William Marsalis at his room in the Great Southern Hotel at Gulfport, that he spent about "twenty minutes with him," and then paid him $2,000.00 cash for two Sherman tanks which the plaintiff proved had just a few weeks before cost, and were still of the value of, $4,500.00. And after paying the said William Marsalis the $2,000.00 in cash money, the defendant nonchalantly proceeded on his way to Franklin, Louisiana, to his factory. As for the tanks, the defendant stated that one of them was delivered about "two weeks later," that is, over two weeks after he paid the $2,000.00 cash to a man he had never seen before, in a hotel room at Gulfport, — not at his office or place of business.
Certainly, the plaintiff had good reason to believe that a jury of average intelligence could not, and would not, accept as true the defendant's fantastic version of the transaction; the defendant, Marco Skrmetti, being a business man and the owner of a factory.
Furthermore, the defendant bought the tanks believing them to be the property of William Marsalis.
Certainly, the defendant makes it abundantly clear that he was buying the property from William Marsalis individually, personally, and not from the corporation, — The Marsalis Construction Company. The jury would have been well warranted in concluding that no title whatever passed to the defendant, that the transaction did not in any way involve the corporation but only William Marsalis. The defendant does not pretend he was making or that he made a purchase from the corporation, but only from William Marsalis.
The rule of caveat emptor applies in a sale of personal property. Harrison v. Broadway Motor Co., 128 Miss. 766, 90 So. 453, 25 A.L.R. 1148.
The defendant was utterly reckless, by his own admission. He made his purchase from William Marsalis personally, but Mr. Marsalis had nothing to sell. He might as well have bought the Great Southern Hotel from Mr. Marsalis.
J.D. Stennis, Jr. and Carl Marshall for appellee.
Since appellant concerns himself first with the strength or weakness of appellee's title we call the court's attention to the fact that Wm. I. Marsalis, President of Marsalis Construction Company, was the only officer of said corporation in Mississippi. He was elected to the office of President of the corporation with the powers and duties of its chief executive officer to have general and active management of the business of the corporation; and to execute all contracts and agreements, etc. of the corporation. He executed, for the corporation, the lease covering the place where equipment, including the tanks here involved, was stored by the corporation. Among the things about which he was engaged was the disposition of the equipment which the Federal authorities had not seized, reflected in the letter to him from W.E. Bornemann, of March 25, 1947, and his note to Rappleyea, delivered at the Great Southern Hotel, in Gulfport, Mississippi, on April 1, 1947. Appellee had known Mr. Blue, who introduced him to Marsalis, for about two years and knew that he was on the Gulfport Police Force and had been with the F.B.I. or Federal Immigration Patrol. Appellee, who speaks broken English and is shown by the record to be an uneducated man, knew nothing about Marsalis or Marsalis Construction Company except what Mr. Blue Stanbro, (the man who leased Marsalis Construction Company his garage for a store room or warehouse) and Marsalis, himself, told him and that was: that Marsalis was President of Marsalis Construction Company and had complete charge and authority of all that the company had and was disposing of its property, and "had the whole say so" concerning same and was the man to do business with. Relying on this apparent authority he dealt with the President of this corporation, paying him in cash and getting bills of sale to these two tanks, and later having the tanks delivered pursuant to the bargain he made on his first meeting with Marsalis. He knew nothing of any mortgage if there actually was a pretended mortgage at the time of his transaction with Marsalis.
We submit that contrary to appellant's theory, the evidence shows conclusively that Marsalis, the President of the corporation, by a recognized usage of the corporation, and by a transaction which was then in the ordinary course of the corporate business, that is to say, the disposition of the physical assets of the corporation before they might be seized by the Federal Government in the manner that its principal physical assets had been seized, and with him given such entire management of the corporate business, both in its by-laws and in its minutes and by him being the only officer of the corporation at the place where its physical assets were located, he was clothed with such apparent authority to act for the corporation in all respects, that appellee had a right to rely on his apparent authority and thus became an innocent purchaser for value, without notice, actual or constructive, of any previous attempt by any other officers of the corporation to burden these tanks with a mortgage, if, in fact, said attempt was prior to said sale to appellee. 19 C.J.S. 533, Corporations, Section 1038; 19 Am. Jur. 883, Corporations, Section 904; Tupelo Hotel Co., Inc. et al v. Long, 156 Miss. 337, 126 So. 6; Meder v. Superior Oil Co., 151 Miss. 814, 119 So. 318; Moyse Real Estate Co. v. First National Bank of Commerce, 110 Miss. 620, 70 So. 821.
In the Tupelo Hotel Co. v. Long case, supra, Leake was the President of the Tupelo Hotel Co., Inc. The hotel owned by the corporation was for sale. Leake, as President of the corporation, agreed to pay Long a commission to make a sale. Long found a purchaser, and brought the parties together. The corporation then sold to the purchaser for a price less than that stated by Long. Long claimed the full commission, and the corporation refused to pay, on the ground that (1) Leake, the President, had no authority to bind the corporation in employing Long to make the sale; (2) Notice of Long's claim to Leake was not notice to the corporation; and (3) The purchase price was not that quoted by Long.
Judgment was rendered for Long, the plaintiff, in the circuit court of Lee County, and was affirmed by the Supreme Court. The court said: "Whatever the rule may be in other jurisdictions, the rule in Mississippi . . . is that the President of a company has prima facie authority to represent the company in business transactions."
In the Moyse Real Estate Co. v. First National Bank of Commerce case, supra, two accomodation notes, payable to H.G. Lea, and signed "Moyse Real Estate Co., by J.L. Moyse, President", came into the hands of the bank for value.
In this action by the bank to collect the notes, the Real Estate Company defended on two grounds: (1) That the notes were accommodation paper, without consideration, and (2) that the President of the company was without authority to execute them.
Affirming the action of the lower court in directing the verdict for the plaintiff, the Supreme Court held, first, that the bank being without notice that the notes were accommodation, its right to recover was not affected; and, second, that the fact that the president of a corporation has executed a contract for his corporation is prima facie evidence that the president had the authority to bind the corporation. The court held: "The acts done by the president pertaining to the business of the corporation, not clearly foreign to his powers, will, in the absence of proof to the contrary, be presumed to have been authorized by the corporation. This, we think, is a salutary rule, and imposes no hardship upon either party to the contract. The corporation selects its president, and the ordinary business man, generally speaking, assumes that the man made president is the head and front of the corporation."
In the case of Meder v. Superior Oil Company, supra, R.B. Royster was not even the President of the corporation, but on the contrary, he was Secretary-Treasurer and manager. As such, he entered into a contract with W.F. Meder regarding the rental and the erection of a filling station and upon the breach of said contract, Meder sued for damages for said breach. It was contended that the secret by-laws of the corporation did not authorize Royster to sign the contract. Evidence was introduced to show the corporation through Royster leased the ground embraced in the contract and to show that Royster was in charge of the business of the corporation, making various contracts for the corporation and signing the contracts in its behalf without any other official complying with the by-laws in reference thereto. At the conclusion of the testimony, a peremptory instruction was granted the defendant, and this court held on appeal: "In reference to the second ground, that Royster had no authority to bind the corporation, we think the proof is sufficient to show that he did have authority to act for the corporation, and, as shown by the lease to Mr. Melder, the contract was not repudiated upon the ground that Royster did not have the power to make it, or that the Superior Oil Company relied upon any by-laws; but it is shown that the reason for repudiating the contract was that there was a price war in the oil market at Biloxi.
The facts introduced in evidence, to show Mr. Royster's authority, are sufficient for the jury to believe therefrom that he had authority to act for the company in regard to the contract, and it was therefore error for the circuit judge to refuse to submit the issue to the jury."
There is nothing unusual about the transaction between appellee and the President of Marsalis Construction Company, as appellant attempts to infer and to charge. Appellee, a man who speaks broken English and who is incapable of twisting his words to give different meanings to them testified over and over again as to just how he learned that Wm. I. Marsalis, the President of Marsalis Construction Company had these tanks for sale and how he went out and looked at the tanks and learned from the man in charge of the place where they were stored that Marsalis had, "the whole say so" and the authority to sell them and then how he met Marsalis and consummated the purchase of the tanks, paying him in cash and getting the bills of sale to the tanks with the tanks to be delivered later, and how he, as a business man on his way to attend to other business in Louisiana, proceeded on to his canning factory in Louisiana. He didn't say that he nonchalantly proceeded on his way, because he didn't know what nonchalantly meant. He said he paid $2,000.00 cash for the tanks. But he didn't say that these tanks had only a few weeks before then cost $4500.00 and were still worth that amount, because he didn't know what they had cost, nor just what they were worth. He did say that he could have bought other motors like these in these tanks for $500.00 each, and it was the motors that he was interested in, but that he believed that these were a better bargain.
If appellant conceived the idea that there was anything fantastic about appellee's version of the transaction between him and the President of Marsalis Construction Company when he purchased these tanks, we are sure that no one else did or could reasonably conceive such idea. Counsel for appellant had appellee's bills of sale for examination while appellee was on the witness stand as an adverse witness. They were before the court for examination and no point was made in regard to any feature of said bills of sale except that they were not dated. While appellee was questioned regarding said bills of sale they were not introduced in evidence, first, because it was not even necessary that appellee have a bill of sale to these items of personal property so long as he paid value for the property and the tanks were delivered to him; and secondly, because they would simply increase the volume of the record. If appellee had desired to be untruthful regarding said transaction and as to the date on which it took place, he might have as well stated that it took place prior to March 28th, the date which appellant caused its note and chattel deed of trust to bear. Mr. Rappleyea, who opposed appellee even more strenuously than appellant, as a witness for appellant, could not say that this transaction did not take place just as appellee explained it over and over again. Leaning over backward in an effort to believe anything that the witness Rappleyea said, we are compelled to disregard a lot of testimony by him as to dates on which he visited Marsalis in Gulfport and other dates on which he came to Biloxi, or was on a trip or trips to Central America in order to believe that was not in Gulfport, Biloxi, and Central America all at the same time. In spite of the fact that the purported chattel mortgage was not filed for record until April 15, 1947, the witness Rappleyea, repeatedly testified that on April 1st, 1947, he told Marsalis, the President of the corporation, that he and the other director of the corporation had executed said mortgage and that it had been recorded. It is conceivable how this witness, who withdrew approximately $20,000.00 from the bank in Gulfport, which had been on deposit to the credit of the corporation, immediately following the seizure by the Federal authorities of the principal physical assets of the corporation, and who according to his statement, had no fear that these tanks might be seized in like manner, but who was looking forward to his present sojourn and who was looking backward to his flights to Central America, although having been a Vice-President in Higgins Industries, and having formed an association with Wm. I. Marsalis on his first meeting with him, and who organized the corporation of Marsalis Construction Company and gave Marsalis the honor of being President of the company, but who invested a fortune in the company and never let any stock therein be issued to anyone, could very easily, in the course of six months, forget trivial things such as dates and under oath testify that a thing which happened once happened on a half dozen different dates.
Appellee Skrmetti knew nothing about the inner workings of the Marsalis corporation. He knew only that Marsalis was reputed to have and apparently did have full authority to deal with the corporation's property, and that in such dealings he was attempting to sell these tanks. He thought that he was getting a bargain, but he knew that he ran the risk of having to replace parts of these motors in order to convert them to marine motors for his boats, without knowing what the cost of reconversion would be, but having interested himself in the purchase of these tanks he consummated said purchase on his meeting with the President of the corporation. The sale was complete and the title passed when Skrmetti paid the purchase price and not as urged by appellant when the delivery was made. Johnson v. Tabor, 101 Miss. 78, 57 So. 365. In the case of Johnson v. Tabor, supra, Tabor as agent for Herron purchased from Johnson two horses for the sum of $175.00. The purchase price was not paid in cash but Tabor immediately gave Johnson credit on a debt owed Tabor's or Herron's store, delivering a receipt to Johnson for that amount. Johnson asked to be allowed to use the horses for several days and promised delivery on a certain date. He failed to make delivery and Tabor sued in replevin. Johnson contended, among other defenses, that the sale was not completed because delivery was not made.
Affirming the judgment for the plaintiff on this point, this court said: "The stock, however, were never actually delivered; and it is argued that for that reason the sale was incomplete, and that title never vested in appellant. Where a sale of personal property is otherwise complete, delivery as between the parties to the contract is not necessary in order to invest the purchaser with the title thereto, unless delivery is required by the contract as a condition precedent to the vesting of title and the completion of the sale." It is a well settled principle of law that title to personal property passes on payment of the purchase price as between parties. 55 C.J. 551-577, Sections 555-584.
"Generally on the execution and delivery of a bill of sale property in the goods passes from the seller to the buyer, and entitles the latter to the immediate possession, provided the instrument evidences a present sale, and is otherwise valid and sufficient in form and properly executed. In such case actual delivery of the goods is not necessary to pass the property as between the parties, or even as against creditors of, or subsequent purchasers from the seller, provided the sale is made in good faith, particularly where such third persons have notice of the sale. If the instrument does not show a present sale, the contract is executory merely and no title passes and although certain terms are used which alone would import a present sale, the title will not pass if it otherwise appears that such was the intention of the parties, but the buyer's title cannot be defeated by the undisclosed intentions of the seller." 55 Corpus Juris, 581-583, Section 589 (7A).
The omission of the date of a bill of sale does not render it bad or void. 55 C.J. 584.
An absolute sale followed by delivery to the buyer vests the title in him. 55 C.J. 566, Section 575.
Where there is an unconditional contract of sale of specific goods in a deliverable state, nothing remains to be done other than delivery of the goods and payment of the price, and a different intention does not appear, the property in the goods passes to the buyer when the contract is made without actual delivery of the goods or payment of the price therefor. This is true, notwithstanding the buyer cannot take away the goods until the price is paid or tendered, unless the sale is on credit. 55 Corpus Juris, 535, Section 534; Leonard v. Davis, 1 Black (U.S.) 476, 17 L.ed. 222; Jenkins v. Jarrat, 70 N.C. 255.
Under a complete or executory contract the property in goods passes at once from the seller to the buyer at the place where the contract becomes completed. 55 C.J. 532, Section 533. Title passes when the contract is made. Rosenberg v. Beak, 56 Cal. A 212, 205 P. 18; Idaho Impl. Co. v. Lamback, 16 Ida. 497, 101 P. 951; Okla. Moline Plow Co. v. Smith, 41 Okla. 498, 139 P. 285. It is the general rule that title passes in a bargain and sale at the time the agreement is struck. King v. Adams, 265 Fed. 9, 11. A sale is complete so as to pass title, when the parties mutually agree to all terms of sale and bind themselves to perform their respective obligations. Jones v. Ballard, 19 Ala. A 460, 98 So. 40. Where the goods sold are in possession of the seller, and are definitely ascertained and agreed upon — nothing remaining to be done to determine their price, quantity or identity — the sale is completed, and the title passes by force of the contract itself, in the absence of anything to show a contrary intention. Iron City Grain Co. v. Arnold, 215 Ala. 543, 112 So. 123.
Appellant attempts to construe appellee's testimony as indicating that appellee purchased from Marsalis personally and not as the President of Marsalis Construction Company, the tanks involved. Certainly no reasonable person could seriously contend that this was true even by reading only the quoted part of appellee's testimony, for there he stated that Marsalis told him that he was President of the company and that he bought these tanks on his (Marsalis') authority, and that he, appellee, paid him, Marsalis, for them, and he, Marsalis, told him that he was the President and that he had full charge of them. The fact that he stated that Marsalis told him that he owned them and they were his stated in the same sentence with the statement that Marsalis told him that he had full charge of them and that the man where they were stored told him, "it was Marsalis", only indicates that the anpellee, having just stated that Marsalis told him that he was the President of the company and that he had authority to sell the tanks and that he stated further in the same sentence that the man where the tanks were stored told him it was Marsalis and he had just stated that this man told him that Marsalis had the whole say so simply indicates that he could not express himself in the profuse manner that the witness Rappleyea wandered about and like a cat attempted to again light on his feet every time that his foundation was cut out from under him.
The question presented here for decision is whether or not the action of the trial court was erroneous in granting a directed verdict in favor of the defendant in replevin, Marko Skrmetti, at the close of the evidence offered on behalf of the plaintiff, Felide Oubre, Trustee in a deed of trust held by Paul, Rice Levy, Inc., of New Orleans, Louisiana, which secured an indebtedness of the Marsalis Construction Company, a corporation, in the sum of $7,311.87, in favor of the said beneficiary.
The property described in the deed of trust consisted of four General Sherman Army Tractor Tanks, General Motors 225 H.P., Diesel Engines, U.S.A., then stored at Stanbro's garage, in the City of Gulfport, Mississippi, two of which are involved in this suit. All of the army tanks were without guns and otherwise completely demilitarized. They had been purchased from the United States Government along with other surplus war material by the said Marsalis Construction Company, grantor in the said deed of trust, which bears the date of March 28, 1947, and was not filed for record at Gulfport, in Harrison County, Mississippi, until April 15, 1947.
In the meantime, according to the testimony of the defendant, Marko Skrmetti, who was introduced by the plaintiff as an adverse party and witness, the two tanks in question were sold on April 2, 1947, to said defendant in the City of Gulfport, by William I. Marsalis, the president of the Marsalis Construction Company, which was a foreign corporation having and maintaining an office at Gulfport, where the said president of the corporation was its sole representative in this state. This witness further testified that he paid the sum of $2,000, in currency, as the cash purchase price of the property, without notice of the existence of the deed of trust thereon.
Section 870, Code of 1942, provides, among other things, that "Mortgages, deeds of trust, and other liens on personal property executed out of this state shall only be binding upon such property in or when removed into this state, as against creditors and bona fide purchasers without notice, from the time such mortgage, deed of trust, or other instrument, . . ., shall be delivered to the proper clerk in this state for record."
The proof on behalf of the plaintiff discloses that the deed of trust was executed at New Orleans, Louisiana, on property then stored in Stanbro's Garage at Gulfport, Mississippi, as aforesaid, which place had been leased to the Marsalis Construction Company at a rental of $150 per month for a period of six months for the storing of said tanks and other surplus war material belonging to said corporation. That pursuant to the articles of incorporation and by-laws of the company, it had established and was maintaining its principal business office at Gulfport, although the home office was at Wilmington, Delaware, and the president of the company, who was one of the only three directors, was in charge of the said Gulfport office. That under the by-laws it was provided that "The president shall be the chief executive officer of the corporation. It shall be his duty . . .; to have general and active management of the business of the corporation; . . ." The other two directors of the corporation were A.R. St. Philip and George W. Rappleyea, of New Orleans, Louisiana, the former being the vice-president, and the latter, secretary and treasurer.
The deed of trust in question was executed in the name of the corporation by its said secretary and treasurer with the consent of the vice-president, but without previous notice to the president of the special meeting at which its execution was authorized, although the by-laws of the company provide that the "special meetings may be called by the president on two days' notice in writing or on one day's notice by telegraph to each director, and shall be called by the president in like manner on the written request of two directors."
It is, therefore, urged by the appellee Skrmetti, defendant in replevin, that the deed of trust was not properly authorized and is invalid, and that the same was not subject to recordation in Mississippi because of an alleged defective acknowledgment before the notary at New Orleans. However, the proof disclosed that George W. Rappleyea owned all the paid-for stock in the corporation at the time he executed the deed of trust on its behalf, and we shall assume for the purposes of this decision, and for that purpose alone, that the conveyance was duly authorized and validly executed; and also that the acknowledgment was such as to entitle it to a recordation in this state, in view of the fact that at any rate it was not recorded until April 15, 1947, so as to become binding on the personal property purchased in this state by the defendant in replevin, within the meaning of the said Section 870, Code of 1942, supra, provided the defendant was a bona fide purchaser of the tanks for value within the meaning of the said statute, without notice of the lien of said deed of trust.
As heretofore stated, the plaintiff introduced the defendant in replevin, Marko Skrmetti, as an adverse party and witness under Section 1710, Code of 1942, with the right thereunder to contradict the testimony of such party and witness, and he testified, in substance, but without contradiction, that he learned through one Mr. Blue, an officer of the City of Gulfport, that the said army tanks were for sale and could be purchased from William I. Marsalis, the president of the Marsalis Construction Company; that he went to Stanbro's Garage, where the tanks were stored, and that he examined them and found that they "were not fit for marine purposes (since he wanted them for his boats) unless there had been lots of changing, and that he would have to get new bases (for the Diesel Engines), and that a mechanic would cost lots of money." And the record shows that he made this statement in answer to the following question: "When you say that you were running a risk, what do you mean by that?"
The defendant further testified, in substance, that he knew that the Marsalis Construction Company had the garage under lease, and that Mr. Stanbro "told me that Mr. Marsalis was president of the Company, and he had all of the say-so"; that after he saw the tanks he went to the hotel where he was introduced by Mr. Blue to Mr. Marsalis; that it "was in the morning, and I was on my way to Franklin (La.)"; that he went to Franklin, and came back that night; that while at the hotel, Mr. Marsalis, whom he had not seen before, "told me that he was the president of the company, and I bought these tanks on his authority"; that he talked to Marsalis about twenty minutes, and paid him $1,000 each, in currency, for the tanks, received a bill of sale therefor, which the seller failed to date, and that he was in a hurry to get to Franklin; that "Marsalis told me he had a right to sell them, that he was the president and this other man came to see me afterwards (meaning Mr. Rappleyea who came to see him two or three weeks later, and whom he had never seen nor heard of before)".
After having testified "I just bought the tanks and paid him for them, and he told me he was president", the witness further said, "He told me that he owned them, and they were his, and he had full charge of them, and the man where they were stored told me it was Marsalis." On the basis of this latter statement, it is contended by the appellant that the defendant, Skrmetti, purchased the tanks from Marsalis as an individual, and not from the corporation. But since the testimony of the witness as a whole discloses that he was an uneducated man, we think that it is clear that his testimony, when viewed in its entirety, shows that he understood that he was purchasing the tanks from Mr. Marsalis as president of the Marsalis Construction Company.
At any rate, (Hn 1) he handed the bill of sale to counsel for the plaintiff while on the witness stand, at the latter's request, and he was not asked to make the same an exhibit to his testimony, and it was not introduced in evidence. The instrument would have, of course, disclosed whether or not it was executed in the name of the Marsalis Construction Company, and, since the burden of proof was upon the plaintiff to show that the defendant purchased these assets of the corporation from Marsalis as an individual, if that contention was to be relied upon, and in view of the fact that the instrument was before the court at the trial, we shall assume that it was executed in the name of the corporation, since the latter admittedly owned the tanks at that time.
It may be conceded that it was an unusual circumstance that the defendant would have paid for these tanks in currency in the room of Marsalis at the hotel, instead of by check, but the fact is he evidently did pay for them in some manner or they would not have been delivered to him by the seller; and it was not shown that he paid for them otherwise than in the manner stated. Then, too, when it is considered that the witness was en route to Franklin, Louisiana to return to Biloxi on the same day, it is a reasonable inference that Marsalis would not have left his hotel for the office prior to the time the defendant was passing through Gulfport on that morning from his home at Biloxi en route to Franklin, Louisiana. And for aught that appears from the record, it cannot be said that in paying for the tanks in currency, this was, in the language of the noted Henry Ward Beecher, not the "habit" of mind and manner of dealing with men and things" customarily adherred to by the defendent in the transaction of his business. (Hn 2) At any rate, since his testimony was wholly undisputed, we are of the opinion that the trial court would not have been justified in permitting the jury to say that he did not pay for the tanks in the manner testified to by him; and this is especially true in view of the fact that the tanks were delivered to him and it is not shown that he paid for them in any other manner.
Moreover, Mr. Rappleyea, sole owner of the corporate stock, had been informed, prior to the execution of the deed of trust, and therefore several days before the purchase by the defendant, that Marsalis was undertaking to sell and dispose of all the tanks and collect the cash therefor, the proceeds of the sale to be divided between himself, St. Philip, and one Ethlee, and he testified that this "put me on notice, and I had already promised Paul, Rice Levy this mortgage and note, and I went back and executed the note and the mortgage." He further testified that he came to Gulfport on the following day, told Marsalis of what he had been informed, and that the mortgage had been executed on the tanks in question; that he also informed Mr. Stanbro, the garage owner, about the mortgage on that same date; that the latter requested a written notice in that behelf, and evidently to better safeguard the interest of the owner or lienor; and that he went to the attorneys for Paul, Rice Levy and "asked them to send him (Stanbro) a telegram that the tanks were mortgaged." This alleged notice was given by them to Marsalis and to Stanbro on March 29, 1947, following the execution of the deed of trust on the day before, and yet the witness, Rappleyea, does not claim to have suggested to Paul, Rice Levy, or its attorneys, that the deed of trust be promptly filed for record at Gulfport, Mississippi, although he says he executed the same in an effort to protect the interest of said beneficiary and at a time when he knew, according to his own testimony as sole stockholder in the corporation, that Marsalis was endeavoring to sell the tanks in question. The record is silent as to whether Marsalis either admitted or denied to Rappleyea that he was trying to sell this property. At any rate, Rappleyea, as secretary and treasurer and sole owner of the corporate stock, permitted the president to remain in charge at Gulfport and paid his salary for a time thereafter served as such officer.
Neither Marsalis, Blue, nor Stanbro was offered as a witness, but it was shown that Marsalis was unavailable. If Stanbro was informed of the deed of trust held by Paul, Rice Levy on the tanks the next day after its execution, he failed to inform the defendant, Skrmetti, of such fact, when four days later he told the latter "that Mr. Marsalis was president of the company, and he had all of the say-so." It is true that Stanbro, who is not shown to have had any connection with the company, was under no legal obligation to inform the defendant of the deed of trust.
(Hn 3) Of course, whatever was said by either Blue or Stanbro to the defendant was not binding upon the plaintiff as to the authority of Marsalis to make the sale, but it has material bearing upon the alleger good faith of the defendant, Skrmetti, in his purchase of the property in question.
It appears that two landing ships and certain other supplies war material in possession of the Marsalis Construction Company had been seized by the federal authorities upon the theory that they were about to be disposed of in other countries in violation of some federal law. The seizure occurred about the first of March, 1947 before the four army tanks arrived at Gulfport, on the 17th or 21st of that month.
The witness, Rappleyea, testified that he intended to lease these tanks to timber operators in British Honduras for hauling timber to the sawmills there, and that his company was to receive $1.50 per thousand feet of timber for their use. However, (Hn 4) the defendant, Skrmetti, is not shown to have known anything about the intentions of this corporation, and had the right to assume, in the absence of notice to the contrary, that its chief executive officer and only representative in this state had authority to dispose of the same for the reason that the company was engaged in no business at Gulfport or elsewhere in this state wherein the tanks were to be used. Apparently, they had been purchased for resale, so far as Skrmetti was advised.
We are, therefore, of the opinion that there was not sufficient conflict in the evidence to warrant the trial court to submit the question to the jury of whether or not the defendant, Skrmetti, was a bonafide purchaser for value of the property without notice of the deed of trust within the meaning of the said Section 870, Code of 1942, and that the case should therefore be affirmed.
Affirmed.