Baker v. Wainwright

Bartol, C. J., delivered the opinion of the Court. This action was instituted by the appellant, to recover compensation and indemnity for liability and expenses incurred by him, in the service and employment of the appellees as their agent. To support the plaintiff’s case, parol evidence was offered (subject to exception as to its admissibility) as follows: “That on the first day of March, 1867, the defendants desiring to purchase a parcel of land situated in Delaware county, in the State of Pennsylvania, which was then about to be sold at public auction by the sheriff of that county, and for the purpose of securing a debt due to them by the owner thereof, and wishing not to be known as the purchasers thereof, requested the plaintiff to attend the sale, and bid for, and purchase the land for them at a price not exceeding $8,000. That plaintiff, in company with the defendants and their attorneys, attended the sale, and plaintiff bid for the land to the amount of $7,025, at which price it was knocked down to him by the sheriff, as the purchaser; $200, a part of the purchase money, was paid by him in cash to the sheriff, and the defendants immediately after, then and there, gave him their check for the same.” It was further proved (also subject to exception) that at the time and place of sale, in the presence of the defendants and their attorneys, the following instruments of writing were signed, viz: “ The conditions of sale of all the right, title and interest of John A. Morris, Thomas H. Wilson and John H. Musser, trading as Morris, Wilson & Co., of in and to the real estate described in the above annexed advertisement of sale are as follows: ” “ First. The highest and best bidder by fair and open bids, shall be the purchaser.” — 344 — “Second. $200 of the price, or sum at which the above described premises may be struck off, must be paid at the time and place of sale, * * * and the residue of the purchase money must be paid to the sheriff at his office in the borough of Media, on or before the fourth Monday of March, 1867.” “ Third. If the person or persons to whom said real estate may be struck off, shall neglect to take the same at his or their bid, and fail to comply with the conditions of the sale thereof, the same will be exposed to sale again by reason of such default, at the sole risk of the purchaser or purchasers thereof, who shall derive no benefit from such second sale, but he or they shall pay any and all deficiency between his or their bid, and the price the same shall bring at such subsequent sale, with all interest, costs find expenses consequent thereon.” “Fourth. The purchaser complying with the conditions, shall have a deed made in due form of law, on paying the customary fees. Signed, Caleb Hoopes, Sheriff.” “ I do hereby acknowledge that the real estate described in the advertisement of sale, was fairly struck off to me at my bid, at and for the price or sum of $7,025, which sum I do hereby acknowledge myself indebted to Caleb Hoopes, sheriff, and bind myself for the payment of the same, agreeably to ' the conditions of sale.” “In testimony whereof, we have hereunto set our hand and seal, this first day of March, A. D. 1867. Signed, Geo. Baker. [/SW.] Witness present at signing, B. E. Baker.” “Received two hundred dollars, part of the purchase money for the real estate described in the advertisement of sale. Signed, Caleb Hoopes, Sheriff.” — 345 — “And further proved that the defendants then and there, thanked plaintiff for what he had done in the premises, and promised to comply with the conditions, and pay the residue of the purchase money for the land, when payable, according to the terms of sale, and that plaintiff should have no further trouble in the matter, and that plaintiff directed that the sheriff’s deed for the land should be made to the defendants, and the time and place were appointed for the payment of the money, and the delivery of the deed as aforesaid, and the defendants assented and expressed themselves as fully satisfied with the arrangement. That the parties met accordingly at the time and place appointed, when defendants said that they were unable to procure the balance of the purchase money, and requested and obtained an extension of time from the sheriff, for about six weeks, at which time they promised to pay the same, but that they failed to do so, and the property was afterwards re-sold by the sheriff at a less price, and purchased by a brother of the defendants.” “ That plaintiff was thereupon sued by the sheriff for the balance of the purchase money on the first sale mentioned, and judgment was obtained against him thereon on the 27th day of February, 1868, for the sum of $3,749.87, with interest and costs, which plaintiff was compelled to pay under execution, as shown by the record of the judgment offered in evidence by the plaintiff. That plaintiff frequently called upon defendants to furnish the money for payment of the balance of purchase money, and they frequently promised to do so, and to pay plaintiff for all his payments, trouble and expense in the premises, and for that purpose assigned him a claim, on which he realized about $3,000.” “ It was further proved that when the suit of the sheriff against the plaintff came on for trial in the Court of Common Pleas in Delaware county, Pennsylvania, the defendants attended for the avowed purpose of defending the suit, and the attorneys who appeared on the record as the attorneys of Baker, had been consulted by the Wainwrights in reference — 346 — to the suit. That there was a consultation between the said attorneys, the defendants and Baker (the plaintiff in this cause,) in reference to the case, and the proper course to be pursued, and it was agreed that judgment should be entered for the aforesaid sum of $3,749.87, on condition that a stay of execution thereon should be given for three months, at which time the defendants promised to pay the said amount, and at their request the judgment was entered accordingly.” The object of this suit is to recover the balance of the money thus paid by the plaintiff, which remains unpaid to him by the defendants, with interest thereon, being the loss, cost and expenses incurred by the plaintiff in the service of the defendants as their agent. The only question material for us to decide on this appeal, arises upon the third bill of exceptions. Upon the state of facts disclosed by the testimony, which we have set out at length, six prayers were offered by the plaintiff, all of which were refused, and the Circuit Court, at the instance of the defendants, instructed the jury “that the evidence in the cause was not legally sufficient to entitle the plaintiff to recover.” The ground on which the appellees support this instruction, and that upon Avhich the whole defence rests, is that the contract between the appellant and appellees, as shown by the proof, comes within the fourth section of the Statute of Frauds, which declares that “ no action shall he brought upon any contract, or sale of lands, tenements or hereditaments, or any interest in or concerning them, unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, signed by the party to be charged, or some other person thereunto by him lawfully authorized.” Unquestionably the claim of the plaintiff in this case is a most just and meritorious one, and if this defence is to prevail, there would seem to be a failure and denial of justice. It was remarked by Chief Justice Buchanan, in delivering the opinion in Lamborn vs. Watson, 6 H. & J., 255, where — 347 — the defence under the Statute was successfully relied on for the protection of a dishonest defendant, “ that the Statute probably generates as many frauds as it prevents.” Still the Statute is binding upon us and must be obeyed and enforced whenever a case falls within its provisions. The experience of nearly two hundred years has proved its wisdom, and whatever opinions may have been expressed with regard to the apparent hardship, sometimes caused by enfoicing its requirements of written testimony in certain cases, it has no doubt, in the main, served the purpose of its enactment, In the prevention of frauds and perjuries, and proved a great safe-guard and protection against illegal and groundless claims. lío where have its provisions been more strictly and constantly enforced than in this State. We are not in favor of impairing or restricting its operation. But in the opinion of a majority of this Court, the present case does not fall within either the letter or the spirit of the fourth section. The contract upon which the liability of the defendants arises, is not one involving a title to land. It is simply a contract of agency, under which the plaintiff as agent, has incurred loss and expense, for which he seeks compensation. Judge Story, in his work on Agency, see. 339, says: “ If an agent has, without his own fault, incurred losses or damages in the course of transacting the business of his principal, he will bo entitled to full compensation therefor.” In this case, the business and employment of the agent, it is true, was to purchase land; but this does not bring the case within the fourth section of the Statute. The purchase of land was a matter collateral to the contract, which constituted the relation of principal and agent between the parties, and on which the liability arises. To prove this contract, written proof is not necessary. It has long been settled that the employment of an agent under the 4th section of the Statute need not be by writing, the authority of the agent may be shown by parol. Coles vs. Trecothick, 9 Ves. 250. We refer — 348 — also to Browne on Statute of Frauds, sec. 370, and 2 Kent’s Com. 614, and the cases there cited. In Sugden, on Vendors and Purchasers, ch. 4, sec. 5, (last London Ed. 145) the learned author says: “In the 1st and 3d sections of the Statute of Frauds, which relate to leases, &e., the writing is required to be signed by the parties making it, or their agent authorized by writing. This latter requisite is omitted in the 4th and 17th sections of the Statute. The Legislature seems to have taken this distinction, that Avhere an interest is intended to be actually passed, the agent must be authorized in writing; but that where a mere agreement is entered into, the agent need not be constituted ■by writing, and therefore an agent may be authorized by parol to treat for, or buy, or sell an estate, although the contract itself must be in writing.” For this, many cases are cited in “ note a.” If an agent for this purpose, can be legally constituted by parol, it would seem to follow, logically, that when so appointed, he would be entitled to recover compensation-and indemnity for his services rendered, and for his costs and expenses incurred in attending to the business of his principal, and that the principal cannot escape his liability upon the ground that the contract which the agent has been authorized to make, is within the Statute of Frauds, and must be evidenced by writing. If the agreement for the purchase of the laud in this case had been signed by the plaintiff in the name of his principals, the defendants, for whom the purchase was made, or had been signed by him as agent, there would be no doubt of the right of the plaintiff to maintain this suit. This has virtually been conceded in the argument, but having signed the contract in his own name as purchaser, it is argued that parol evidence is inadmissible to show that the real purchasers were the defendants, and that he signed it as their agent. The argument is that such evidence is inadmissible to bind the defendants, because, it is said, that if the plaintiff had chosen to claim the — 349 — benefit of the purchase for himself, and had gone on to complete the contract, had paid the purchase money and obtained a deed, the defendants would have been without remedy, that they could not have claimed the benefit of the contract or been allowed to give parol evidence to prove that the land was purchased for them, according to the decision in Lamborn vs. Watson, 6 H. & J., 252; Dorsey vs. Clarke, 4 H. & J., 551, and Bartlett vs. Pickersgill, 4 East. 576, note a. If this be conceded, the fact that the plaintiff had it in his power to abuse the confidence reposed in him, and to commit a fraud, is no answer to his demand in the present suit, where the evidence shows that he faithfully performed the service in which he was employed; nor does it in our opinion afford any reason why his appointment as agent may not be shown by parol. .Tlie purchase was made by him in bis own name, at the instance and request of the defendants, who were present, assented and approved of what he had done, paid a part of the purchase money, were well known to the vendor as the real purchasers, and had the opportunity of obtaining the benefit of the purchase, by paying the balance of the price, which they promised to do, and receiving the deed, which the sheriff was directed to make to them. Having failed to perform their contract, and the plaintiff, who had rendered himself responsible by the form in which he had entered into the contract, having been compelled to pay the money, ought to be entitled to recover the same, as money paid for the defendants at their instance and request. If the agent makes the contract in his own name, it is well settled that he is personally bound and maybe held liable; but his principle will also be bound, although not named in the contract, if it be shown that the agent was authorized so to contract for him, and in fact entered into the contract as agent for his benefit and in pursuance of his authority; and there is no good reason why parol evidence may not be received to prove this fact. — 350 — Many cases have arisen under the 17th section of the Statute of Frauds, relating to the sale of goods, wares and merchandize, in which it has been held that where the written contract is made in the name of the agent, parol evidence is admissible to prove that the party signing was agent merely, and some other person was principal. In Wilson vs. Hart, 7 Taunt., 295, Park, J., said : “ It is the constant course to shew by parol evidence whether a contracting party is agent or principal.” • The same doctrine was held in Higgins, et al. vs. Senior, 8 Mee. & W., 834; Dykers vs. Townsend, 24 N. Y., 60, 61 ; Hubbert vs. Borden, 6 Wharton, 79; Ford vs. Williams, 21 Howard, 287; and by this Court in Oelricks & Furman vs. Ford, 21 Md., 489. It is argued that this doctrine applies only to commercial contracts, under the 17th section, and is inapplicable to contracts relating to land falling under the 4th section. It will be observed that the terms of the two sections arc substantially the same, so far as they relate to the signing by the party to be bound, or by his agent, thereunto lawfully authorized. But there are well adjudged cases in which such evidence has been held admissible, where contracts for the purchase of lands have been made by agents. In Sugden on Vendors and Purchasers, chap. 1, sec. 3, p. 47, plac. 9, it is said: “Where the principal denies the authority, and the agent is compelled to perform the agreement himself, because he cannot prove the commission, he may afterwards file a bill against his principal; and if the principal deny the authority, an issue will be directed to try the fact; and if the authority be proved, the principal will be compelled to take the estate at the sum which he authorized the agent to bid.” In support of this, the author refers to Wyatt vs. Allan, M. S., decided in 1777, which is found in the same volume, Appendix No. 7. That case, if it be considered as good authority, settles the question here involved. The same author, on page 145, speaking of the purchase of estates by an agent, says: “ But of course, although he pur — 351 — chased in his own name, yet the fact of the agency, so as to charge the principal, may be made out by parol evidence.” And cites Wilson vs. Hart, 1 Moore, 45; Marston vs. Roe, 8 Ad. & El., 14. The case of Wilson vs. Hart, here cited, we have not found; but have examined Marston vs. Roe, and find that it fully supports the proposition in the text. There, real estate was purchased by Joseph Fox, and the written agreement, evidencing the purchase, was signed by him in his own name, (p. 20.) At the trial of the cause, the plaintiff, for the purpose of showing that it was John Fox who entered into the contract for the purchase of the land, and that Joseph was his agent in that behalf, and liad signed the contract as such agent, offered to give parol evidence 'that Joseph was appointed by John his agent, lor the purpose of making the agreement, and that in consequence of such appointment, Joseph did, in his own name, but as agent as aforesaid, and on behalf of John, sign the agreement. The evidence being objected to, was rejected by the Court below, Aldebson, B., sitting. At the trial of the case on appeal in the Exchequer, Campbell, the Attorney General, arguing the case for the defendant, (p. 30,) contended that the parol evidence was properly rejected, because “its object was to prove a trust of lands created by parol, contrary to the Statute of Frauds. He said, if Joseph had the legal estate in him, it could not be proved by parol that he held as trustee, and if his interest was only equitable, the same objection applies, it being an interest in land. Hor can it make any difference whether the party is called a trustee or an agent. There is not indeed any proof that he did sign as agent. The contract is simply executed by Joseph Fox, in his own name; and the attempt is, in effect, to show by parol that he made the agreement as trustee.” [Lord- Abingeb, C. B.: “Agency would not make him a trustee in the sense in which you state it.” Pabke, B.: “May not a man be authorized by parol to make an executory agreement for another?” Tindall, C. J.: “As an auctioneer is — 352 — made by parol the authorized agent of the parties to the sale.”] The case was decided in favor of the p Antiff upon other grounds, which rendered it immaterial to pass upon the bill of exceptions, involving the admissibility of the parol testimony. But Tindall, C. J., in delivering the opinion, said : “ We have no hesitation in dedaring that the learned Judge toas wrong in rejecting the evidence which was offered to prove that Joseph Fox entered into the agreement of purchase, stated in the bill of exceptions, as the agent of John Fox.” ■ This decision is entitled to great weight, as the case was heard and decided by all the Judges of England, except Lord Denman, who was absent; and seems to us to be conclusive authority in favor of the admissibility of the parol evidence here relied on to prove the contract of agency under which the plaintiff made the purchase. We think this case is clearly distinguishable from Lamborn vs. Watson, 6 H. & J., 252, and Duvall vs. Peach, 1 Gill, 172, and the class of cases to which they belong. Duvall vs. Peach seems to us to be altogether inapplicable. The point there decided, as correctly stated in Browne on Statute of Frauds, 273, was that “ an agreement to establish the title to land in any party, isequivalent to an agreement to sell him the land, and accordingly it was held in that case that an engagement to break down a certain alleged title, under which a third party claimed adversely, or in any way to perfect the title in the promissee, is within the Statute.” In Lamborn vs. Watson the contract which formed the basis of the suit was simply a contract that Watson should buy, and that Lamborn should have the privilege to redeem or re-purchase at the same price. This was the effect of the verbal contract. In form the agreement was that Watson should bid off the land, and the intention seemed to Joe thus to prevent or baffle the sale, so as to give time to Lamborn, (the defendant in the execution,) to pay the judgment debt. Judge Buchanan — 353 — speaks of it as “ an expedient to prevent an actual sale in order to gain time, wliicli was not altogether freo from exception.” The agreement was certainly not one constituting Watson as Lamborn’s agent to buy for him, thus making Lamborn the real purchaser. If such had been the agreement, there is authority for holding that Lamborn might have succeeded in a Court of Equity, in preventing his agent from defrauding him, and have secured the benefit of the purchase, as was decided in Taylor vs. Salmon, 4 Myl. & Cr., 134; Lees vs. Nutall, 1 Russ. & Myln. 53, affirmed in H. of L., 2 Myl. & K. 819; Giddings & Coleman vs. Eastman and Wife, 5 Paige, Ch. R., 561; Parkist vs. Alexander, 1 Johns., Ch. R., 394; Brown vs. Lynch, 1 Paige, Ch. R., 147. But looking at the facts of that case as they were shown by the evidence, and viewing the agreement according to its legal effect; and as parties must he understood to intend the legal consequences of their own acts, it followed of course, that-if Watson bid off the land at the sheriff’s sale, the effect would be, not to prevent a sale, hut to consummate it, as a sale to Watson, and then the effect of the verbal agreement, if allowed, would be to bind Watson to re-sell to Lamborn at the same price; or to create a trust in him for Lamborn’s use, which under the Statute, could only be proved by writing; and thus the case fell directly within the principle of Bartlett vs. Pickersgill, 4 East. (before cited,) and other cases of that kind, among which we may cite, Hall vs. Shultz, 4 Johns. R., 240; Sherrill vs. Crossby, 14 Johns. R., 358; Van Alstine vs. Wimple, 5 Cowen, 162; Smith vs. Burnham, 3 Sumner, 435; Hogg vs. Wilkins, 1 Grant’s Cases, 67. In the case last cited, Judge Black draws a distinction between the case then under consideration, and the case of a purchase of land by an agent employed for that purpose, and says that the agent might be compelled to convey, upon being refunded the price he paid. — 354 — (Decided 20th June, 1872.) We are of opinion, both upon reason and authority, that the parol evidence was admissible for the purpose of proving the employment of the plaintiff by the defendants as their agent; and that the Court below erred in its instructions to the jury, contained in the third bill of exceptions; and in refusing the first, second, third and fourth prayers of the plaintiff. This view of the case renders it unnecessary to express any opinion upon the questions raised by the first and second bills of exceptions. Judgment reversed, and new trial ordered.