Union Pacific Town-Site Co. v. Page

The opinion of the court was delivered by Horton, C. J.: The contention in this case is over the instructions given and refused. It appears that Page & Greenfield, doing business at Monument, in this state, furnished lumber and supplies for the buildings of the following parties at Logansport: Butler, Walters, Barnes, Wolver, Mrs. Handley, the Smith Brothers, and Smith & McCue. They knew at the time of selling the lumber that it was to be used in the buildings of these parties, who had purchased lots of the town-site company. They charged all of this lumber to the town-site company and have recovered judgment on account thereof against it. If this case were here upon the ground that the evidence did not sustain the verdict, or that the town-site company had no authority under its charter to purchase the lumber and supplies in dispute, we could sustain the judgment, upon the testimony in the record. ( Whetstone v. Ottawa University, 13 Kas. 320; Town Co. v. Morris, 43 id. 282; Town Co. v. Swigart, 43 id. 292; Town Co. v. Russell, 46 id. 382.) But the real question before us is whether the instructions as given were misleading or erroneous. There was evidence offered tending to show that Frank S. Thomas, the secretary and treasurer, living at Topeka, had general charge of the affairs of the company; that W. T. Clark was the general manager of the company at Logansport; that Thomas told Page & Greenfield “that Clark represented the company, and that any instructions received from Clark, King or Beamer were all right.” There was also testimony offered tending to show [368] that the town-site company was interested in having the persons to whom Page & Greenfield furnished the lumber sued for, complete their buildings at an early date upon the lots purchased by them from the company. There was also much other testimony offered showing the authority of Clark to represent the company at Logansport, and to make contracts generally to promote the prosperity and the general interests of the company, but the testimony is conflicting. The claim of the town-site company is, that the account for $888.36 was ordered by parties having no authority to charge or make the company liable for the same; that W. T. Clark was simply a director at the time in the company; that his wife held stock in the company; that he was not employed by the company, and never drew a dollar of salary in his life; that the company paid his railroad expenses back and forth from Topeka to Logansport to attend to some business for the company, so as to assist ih making his wife’s stock more valuable, and that was the only capacity in which he acted; that all of the 30 or 40 men working for the company at Logansport were employed by the carpenters and not by Clark; that Clark made arrangements with the carpenters to erect the company’s buildings; that he had something to do with the sale of the company’s lots; that the town company had no office at Logansport; that Clark had some letter heads printed on his own account and for his own correspondence, on which he designated himself as special agent; that these were the only ones he had printed, but that he had no authority whatever from the company to do so; that Thomas paid all of the bills for lumber, materials and labor for the company’s buildings; that King went out to Logansport to sell lots, but was not in any manner in the company’s employ ; that he was never paid anything, but had some means, and went to Logansport to speculate on his own account; that he was not a laboring man, but a friend of Clark’s; that the first thing he, Thomas, knew about the bills for lumber furnished to private individuals was along in September, 1887, after it had been furnished; that he received bills from [369] Page & Greenfield amounting to something over $3,000 for lumber which they claimed to have furnished to private parties; also, that he received a letter with the bills stating they were ordered by the company’s agent, King; and that this was the first he knew anything about these bills or the payment of the same having been guaranteed; that the town company never gave Clark or King any authority whatever to furnish lumber to other or private individuals, or to guarantee any such bills. The fourth instruction given by the court to the jury permitted a verdict for Page & Greenfield, if they sold the lumber Or supplies in dispute to any officer or agent of the company in good faith, engaged in building and promoting the town, if the lumber and supplies were actually used in the construction of buildings upon the town site, although the buildings were for persons to whom the corporation had sold or agreed to sell lots. This instruction did not confine the sale of lumber or supplies to the general or managing agent of the company at Logansport, but used the words, “ officers or agents of the company engaged in building and promoting the town ” ; that is, any officer or any agent of the company. According to the instruction, the belief in good faith on the part of the corporation that any officer or agent had authority to purchase lumber for private individuals to be used upon their own lots on the town site, carried with it the presumption that the company was liable. It is well said by counsel for the corporation that — “ Every carpenter, builder and other person working for the town company at Logansport appeared to have some sort of authority, and, to some extent, did have some ; but if each and every one of these individuals could go out, and, on account of his apparent authority, buy lumber and materials for other persons and bind the corporation, then it' is apparent that the company was unfortunate in the extreme.” Such is not the law of agency. Again, instruction No. 6 was contradictory and confusing in its terms, so much so as to be prejudicial. It was ruled by this court, in St. John Co. [370] v. Cornwell, 52 Kas. 712, that an agent of a corporation having the general charge of its local business has no implied authority to collect debts due his principal by a contract for his own personal board. It was observed in that case: “The general rule is, that the principal is bound by acts within the apparent scope of the agent’s authority, irrespective of secret instructions or private agreements known only to the principal and agent; but is the power to bind the principal for the board of the agent within the agent’s apparent authority? Parties dealing with him necessarily know that board is furnished for the personal benefit of the agent. It cannot be said that employers are generally responsible for the board or other personal expenses of their agents or employés. To carry such presumption to its logical end would make them responsible for clothing, household supplies, and other purely personal expenditures. We think no such authority can be presumed; and when a party deals with an agent with reference to board, clothing or any other matter which the party must know is furnished solely for the personal benefit of the agent, if he relies on the principal for payment, he does so at his peril.” So an agent of a town-site corporation has no implied authority to purchase lumber or other material for private individuals to build houses upon lots which they had purchased of the company. Of course, the company may give its general agent such authority, in order to facilitate the sale of its lots or to promote its general interests, but the instructions proceed too much upon the implied authority of an agent, and, therefore, are not applicable strictly to the facts disclosed upon the trial. Had the jury been instructed to find in favor of Page & Greenfield, upon the statements of Thomas to Page and others, concerning the authority of Clark, King, and Beamer to represent the company generally, and to do everything necessary at Logansport to promote its interest in every way, we would not interfere. “The purpose of securing improvements on a town site is not simply < hat the improvements be there, but that thereby the property the corporation has to sell may be enhanced in value.” (Town Co. v. Russell, supra.) [371] If, upon sufficient evidence of a ratification by tbe town-site company of the acts of Clark, King, and Beamer, the jury had been instructed to find for Page & Greenfield on account of such ratification, the judgment might be supported. A promise to pay another’s debt, not for the other’s sake, but for the benefit of the promisor, is not within the statute of frauds. ( Winn v. Hillyer, 43 Mo. App. 139; Hughes v. Fisher, 15 Pac. Rep. [Colo.] 702; Wood v. Moriarity, 9 Atl.Rep. 427; Parks v. Stafford, 16 N. Y. Supp. 756; Buchanan v. Moran, 62 Conn. 83; Brice v. Opera House Co., 96 Mich. 24; Darst v. Bates, 95 Ill. 498; Davis v. Patrick, 141 U.S. 488.) With some reluctance, we feel compelled, on account of the instructions given, to reverse the judgment, and remand the cause for further proceedings. All the Justices concurring.