Schick v. Warren Mortgage Co.

The opinion of the court was delivered by Gbaves, J.: The appellant contends that the court by its instructions committed serious error and practically directed a verdict for the plaintiff. The instructions complained of read: “The defendant further claims that the plaintiff’s $4000 mortgage by its terms was to be a first mortgage upon said land, and that to make the same a first mortgage it was necessary that all liens and encumbrances then upon said land be paid off and discharged of record. And so if the jury shall find from the evidence in this case that the defendant remitted to said Parrish the $2500, with the direction or intention that said Parrish should pay pff all prior encumbrances on said Butler county land, so that the mortgage given to the defendant by the plaintiff should become a first lien on said land, then the said Parrish would be in law the agent of the defendant in receiving said $2500. “The slips of paper which have been introduced in evidence and which have been called ‘authorization slips,’ purport upon their face to constitute said Parrish the agent of the plaintiff to receive the proceeds of the loan and to pay. off encumbrances, etc., and the signing thereof not being denied by the plaintiff in his pleadings, the execution thereof is admitted; under the issues made by the pleadings in the case, however, the jury are not bound by said slips as to whether the plaintiff in fact constituted said Parrish his agent for the purpose recited therein, but the question of agency is to be determined by you from all the facts and circumstances of the case, and in doing this it is your duty to go behind the technical wording of the instrument and from the entire evidence determine as a matter of fact the question of agency; the parties to a contract can not irrevocably fix the status of a third party in [94] his relation to them by calling him an agent of one of them, if the facts and circumstances show that such was not the fact.” We concur in the criticism made upon these instructions by the appellant. It will be seen that while the general theory of the court was that the question of agency was one of fact to be determined upon all the facts and circumstances shown by the evidence, the jury were limited to the contents of a letter from the appellant to Parrish, about which there was no contention. This left the jury no alternative. It was bound to find for the plaintiff. The letter mentioned in the instructions contained language specifically directing the payment and release of prior encumbrances. The general subject of the letter, however, related to business transactions having no connection whatever with the loan to the appellee. The reference made to this loan was merely incidental to the general purpose of the letter and contained suggestions that would naturally have been made to the appellee himself, being with reference to a matter in which they were mutually interested. The appellant insists that the appellee, having in writing authorized and directed the payment of the money to Parrish as his agent, to be used in the release of the prior mortgage, the question of the agency of Parrish became one of law and not of fact. It does not appear, nor is it claimed, that the appellee was induced to execute this written authority on account of any fraud, mistake, misrepresentation or misunderstanding of any kind. On the contrary, it does appear that he executed the written paper freely and voluntarily and with full knowledge of the purpose for which it was to be used. While this and other circumstances were in evidence, they were excluded from the consid-. eration of the jury by the instructions of the court. If the theory of the court concerning the question of agency was correct, then it should have been submitted [95] to the jury upon the whole evidence. This was not done. On the contrary, it was submitted upon a mere fragment of the evidence, which fragment was undisputed. In our view, therefore, the judgment must be reversed for this misdirection of the jury. This renders it unnecessary to consider the question whether the written authority given by the appellee to the appellant to pay the money to Parrish presented a question of law or not. The judgment of the district court is reversed, with direction to grant the appellant a new trial.