Erickson v. Compton

By the Court, T. R. Strong, Justice. It appears to be a well established rule in England that a principal whose agent has entered into a simple contract in writing in the business of the agency in the agent’s name, whether the agency was or was not disclosed at the time, may prove by parol the fact of such agency and maintain an action on the contract in his own name. Such proof it is there held does not contradict the contract; “ it merely lets in a third party who was really interested.” The cases in support of this doctrine are collected in Story on Agency, § 160, 163, 269, 270, and notes (see also Humble vs. Hunter, 12 Adolphus & Ellis, 310; Schmalz vs. Avery, 3 Eng. Law and Eq. Rep. 391, 395). Indeed the English rule goes further and holds the principal bound by and liable upon such a contract in like manner as if he had signed it (same cases). I am inclined to think, however, that the common law rule on the subject in this state is the other way; it certainly is as respects the liability of the principal on the contract (Newcomb vs. Clark, 1 Denio, 226, 229; Harp vs. Osgood, 2 Hill, 216, 219; Minard vs. Mead, 7 Wend. 68; Pentz vs. Stanton, 10 Wend. 271; Spencer vs. Field, id. 87; Allen vs. Coit, 6 Hill, 318; Evans vs. Wells, 22 Wend. 324; Townsend vs. Hubbard, 4 Hill, 351; Moss vs. Livingston, 4 Comst. 208). Hence, if the question in the present case as to the admissibility of the evidence offered at the circuit was to be decided upon common law principles, I should feel bound by the authorities to sustain the decision excluding it. But I am satisfied that, under the provisions of the Code, the evidence offered in this case was admissible; and that assuming to be true, what was proposed to be proved, the action was well brought in the name of the plaintiff. Section 111, of the Code, provides that “ every action must be prosecuted in the name of the real party in interest, except as otherwise provided in section [474] 113, &c. ' By section 113, “An executor or administrator, a trustee of an express trust, or a person expressly authorized by statute, may sue, without joining with him- the person for whose benefit the action is prosecuted. A trustee of an express trust, within the meaning of this section, shall be construed to include a person with whom, or in whose name, a contract is made for the benefit of another.” It was not necessary fot the plaintiff, as it would have been before the Code to show that the contract was made with him, to entitle him to sue upon it, but it would have been sufficient to prove that he was the sole owner of the contract by its having been made for his benefit.- The difficulty in such a case at common law was well stated by Jewitt, Justice, Newell"' vs. Clarkj before cited. That was an action by the principal on a written guaranty made to his agent. He says: “ The rule in regard to parties to actions seems to be, that every action on an express contract must be brought in the name of the person to whom the engagement violated was originally made, unless it is transferable as a negotiable noté, &c. In the present cáse the promise or agreement is expressly made with Peters; Clark’s name does not appear in the writing. It was not competent to contradict or amend the agreement, by parol proof, by substituting Clark’s name as the promisee in place of Peters.” According to this doctrine an action would not lie in the name of the principal, unless he was an original party to the agreement. The English cases hold that he might be proved to have been such by parol, but the cases in this state appear to decide that the contract could not be thus amended by adding a party. The Code, by the sections named, has abolished the common law rule in regard to parties, in such a case, so far as it was imperative, and conferred upon the exclusive owner of the demand the right to sue in his own name or in the name of the agent, at his election. That rule being abolished ihe plaintiff was not required, in order to maintain the present action, to amend the agreement in question by substituting or adding the plaintiff’s name. The agreement need not have been made by, or with him, as an original party. It might be treated as having been made with Hotchkin. If the plaintiff had the entire title to the claim, it was all that was important. Nor would the parol proof offered [475] have contradicted the contract, regarding it as made with Hotchkin. It would, on the contrary, have been in perfect harmony with it There is no inconsistency between a contract in the name of one person, and the fact that' another person is entitled to the benefit of it. It will thus be seen, I think, that the obstacle which existed at common law to the plaintiff’s bringing the action and making the proof offered in this case, has been entirely removed. In the view of the case now taken, it would have been more proper for the plaintiff to have set forth the contract in his complaint, as made with Hótchkin, and alleged that it was made by him as agent of the plaintiff, and for the plaintiff’s benefit; and I should entertain doubts as to the right of the plaintiff to recover upon the complaint as framed, but for the fact that the defendant has himself set out the contract fully in his answer, and the plaintiff has adopted it in his reply as the one referred to in the complaint. This, I think, obviates the objection now suggested. It follows that the evidence which was rejected should have been received. A new trial is therefore granted, costs to abide the event.