School District No. 6 v. Ætna Insurance

Peters, J. The fact that the sale of the school-house in question was, in most part, upon credit instead of for cash, as the vote of the district imported it should have been, settles this controversy for the plaintiffs. This phase of the case does not appear to have been presented in any of the bills of exceptions or motions considered by the court before. The authority was by recorded vote easily to be seen and understood by those concerned. It is needless to cite cases to establish the general principle that a specific authority or direction to sell, does not authorize a sale on credit; unless, at the place of sale, there is an usage of business, general or special, in reference to which an authority to sell upon credit is supposed to be given. It is suggested in argument that this doctrine may be inapplicable to persons, acting as agents for quasi corporations, like towns and school districts, and that they might be regarded from convenience and necessity, as clothed with executive and prudential power, superior to that of agents of ordinary business corporations or persons. We find nothing in the authorities, and see no reason upon principle, in support of such a modification of the general rule. If there is any distinction, it would seem that the acts of public agents, acting in pursuance of a special authority are to be construed perhaps more strictly than the acts of agents of private persons, upon the ground that public agents are less within the immediate supervision and control of their principals. State of Illinois v. Delafield, 8 Paige, 527; S. C. 26 Wend., 192. Cushing v. Longfellow, 26 Maine, 306. The jury by a special verdict, find that the sale was made upon -one year’s credit, except ten per cent cash; that the proceeds of [339] the sale never came into the possession of the district, nor were used by them; and that the district never ratified the sale. These findings are supported by the evidence. The district would not be bound by the sale made without authority, unless in some way by them ratified. The ratification must be by the principal, and not by the agent of his own acts. The retention of the money and notes by the committee, unless consented to by the district, would be no more evidence of an authorized contract, than their taking the same originally would be. The ratification must be proved. It is not in this respect like a contract obtained by fraud which stands till rescinded; but a contract made by an agent without authority is no contract unless shown to be ratified, though such ratification may, under a variety of circumstances, be presumed. A presumption from the non-action of a corporation like a school district, would be less readily inferrible than in the case of individuals who can more readily act. A district can be bound only by some recorded vote, or some act, or an acquiescence upon their part as a corporation, equivalent thereto. The unofficial conduct of individuals in the district has no controlling effect. As bearing upon these general propositions see Chamberlain v. Dover, 13 Maine, 474; Davis v. School District in Bradford, 24 Maine, 349; White v. Sanders, 32 Maine, 188; Fisher v. School District in Attleborough, 4 Cush., 494; Bliss v. Clark, 16 Gray, 60. In this case the sale was not warranted by any vote. All parties are presumed to have known it. The proceeds of the sale have remained in the hands of the committee from that day to this. The district have neither had nor used them, directly or indirectly. They were neither deposited with the officers of the district who dispense its funds and credit, nor with the town treasurer where the money of the district should be kept. The committee never informed their principals of their action in any official communication or form whatever. Beyond all this, there is plenary evidence to inspire the belief that the committee, with the full knowledge of the vendees, were executing the trust committed to [340] them, in some respects at least, unfaithfully. The rule that where a principal has full knowledge of the acts of his agents, he must dissent, and give notice of his dissent within a reasonable time, is stringent in its application only where the agent and those dealing with him are acting in good-faith, and the principal receives a direct benefit therefrom. Here no benefit whatever but, on the other hand, an injury would have accrued from the action of the committee, if about four hundred dollars were to be received for a property, admitted in the report of the case to have been worth several times that sum. All the subsequent corporate action of the district, so far as any appears, shows that the sale was repudiated. An insurance on the building was renewed. Attempts were made to hold district meetings in the house. An' effort was undertaken to have the building put back to the place from which the purchasers removed it. The persons claiming to own the building were prosecuted by a vote of the district as trespassers, (although the suit was subsequently withdrawn) a significant evidence of disaffirmance of the contract attempted to be made. Upon all this evidence the finding of the jury upon this point must be deemed to be a correct one; and the rulings and refusals to rule upon the questions involved in such finding were sufficiently favorable to the party excepting. All other questions, therefore, but the admission of an item of testimony objected to, become unnecessary to be considered. It seems a paper got into the case, against the objection of the defendants, containing a protest of a majority of the voters against an attempted division of the district, which -would have relevancy only upon a question whether the district number six who were insured, were identical with the plaintiffs who bring this suit. If such a question was broached, evidently it was not pursued. No reference to the question is made in the judge’s charge as reported. So that this piece of evidence would be immaterial. But the defendants contend, that, for that reason, it had a tendency to confuse and prejudice the jury. While, if anywhere, it might have a breath of weight upon the question of fraud that was specially sub [341] mitted to the jury, it is not perceived how it could in the slightest degree weigh with the jury upon the only issue which, in our view of the case, has become material. The verdict should not therefore be disturbed. Motion and exceptions overruled. Appleton, C. J., Cutting, Dickerson, Virgin, JJ., concurred. Daneorth, J., having been of counsel, did not sit.