Cape County Savings Bank v. Gwin Lewis Grocery Co.

Sykes, J., delivered the opinion.of the court. The appellee grocery company by bill in chancery instituted this suit. The material facts necessary to an understanding of this opinion are as follows: The Cape County Milling Company, one of the appellants sold some flour to some merchants of Lexington., Miss., and drew a. draft for this amount on these merchants. » This draft in due course of business reached the hands of the Merchants’ and Farmers’ Bank of Lexington,' Mississippi, for collection, and was by this bank collected. Before the proceeds, however,, were remitted to its correspondent bank, the appellee grocery company instituted this suit in chancery to subject this money to the payment of an alleged claim held by it against the appellant Cape County Milling Company for breach of an alleged contract for failure to deliver it flour claimed to have been purchased by the appellee from the appellant milling company. The appellee alleged that it made a contract with the agent of the appellant .milling company for the purchase of this flour. The appellant milling company denied that this alleged agent had the authority to make a binding contract, for them, but alleged that his only authority was to solicit orders, and that before the contract was binding it had to be ratified or confirmed by them, consequently there was no binding contract. [453] The only question necessary to be considered by us is whether or not this so-called agent had the real or apparent' authority to make a valid and binding contract for the appellant milling company. The uncontradicted testimony shows that Mr. Welsh, the so-called agent of the milling company, entered the service of this company on August 1, 1916'; that on August 2d he called on the appellee grocery company to try to sell or take an order from it for some.flour; that he told one of the officers of the appellee grocery company that he could make' him a certain price on flour, and showed him a telegram from appellant milling company authorizing him to sell some flour that day at that price; after some discussion the officer of the appellee grocery company informed Mr. Welsh that he could purchase flour at other places for a price of ten cents a barrel less than the price contained in the telegram from the appellant milling company; that Mr. Welsh requested that he be allowed to wire his house uto know if he could not meet this lower price, but the appellee grocery company was not willing for him to do so, but told him they would give him an order for1 flour at this cheaper price; that Mr. Welsh told the appellee that he was the state agent for the appellant milling Company and had the authority'to make a valid and binding contract for the sale of the flour and would malee it at this lower price. The following paper was then signed oy the appellee grocery company and Mr. Welsh: “August 2, 1916. “Cape County Milling Company: “Ship to Gwin Lewis Grocery Company, at Lexington, Miss.: When — At once. How ship — Bank of Lexington. Terms — D. B. L. attached. Gwin. Salesman — Welsh. Buyer— 100 bbls. None Better Wood at $5.59 50 one-half bbls. “ “ “ “ 6.09 35 “ “ “ “ “ “ “ 5.69 25 “ “ “ “ « « “ 5.79 “Freight to be added. [454] “Book additional 210 bbls. at same price made Leflore Grocery Company of Greenwood, Miss., to be shipped to above address in sixty days. Price made f. o. b. Jackson, Mississippi, rate figured 61 cents per bbl. to Lexington, Miss., where this 210 bbls. are to be shipped. “(Signed) J. D. Welsh, State Agent, “Jackson, Miss.” It will be noted that Welsh is stated to be the salesman in this order, and that he signed it as “State Agent.” It further appear from the record that this order was not mailed until August 3d. Several days afterwards the appellee, assuming that it had purchased this flour from the appellant, wired appellant to ship, same, to which telegram the appellant replied that it had no flour booked for appellee. From the record it appears that Mr. Welsh mailed this written order to the appellant milling company on the 3d of August and accompanied it by a letter in which he asked them please to confirm the sale. The sale ivas not confirmed, and Mr. Welsh Avas notified of this fact by the appellant milling company, but Mr. Welsh failed to notify the appellee grocery company of this fact. Consequently the first notice the appellee received was about six days after the order had been taken. In the meantime flour had advanced and continued to advance for some time. On August 28th the appellee grocery company wired the milling company for prices on flour, and the appellant replied by Avire to the effect that their Mr. Welsh Avould see appellee grocery company in the next few days Avith prices. This suit is for the difference in price of flour claimed to have been purchased as above stated and the price the appellee grocery company was compelled to pay for this flour in the open market. A decree was rendered in favor of the appellee grocery company. It is the contention of the- appellee grocery company that Mr. Welsh was the general agent of the appellant milling company, or was held out by it to ,be its general agent, and as such had the real or apparent authority [455] to make this contract. It is claimed that this is shown by the declarations of Mr. Welsh made to the officer of the appellee grocery company at the time this memorandum was signed, and further by the fact that Welsh signed this agreement or memorandum as “State Agent,” and mailed a copy of it to the appellant milling company so signed, and also by the further 'fact that when on August 28th they wired appellant to quote them prices on flour they were referred to Mr. Welsh. Counsel for appellee rely upon the case of Potter v. Springfield Milling Co., 75 Miss. 532, 23 So. 259. From the opinion in that case, however, it appears that the Springfield Milling Company had given Potts the authority to sell its flour to all persons- wishing to purchase it. That is the very question in issue in this case. The authority of an agent to bind his principal rests upon the powers conferred upon him by the principal, and the burden of proof to show that this real or apparent authority is with the complainant in this case, and this burden the complainant has attempted to meet by proving the mere statement of the agent made to the appellee. Agency cannot be proven in this way. Sumrall v. Kitselman Bros., 101 Miss. 783, 58 So. 594; Gulfport & Miss. Coast Traction Co. v. Faulk, 118 Miss. 894, 80 So. 340. The fact that the order was signed “State Agent” falls in the same category, viz. it is an attempt to prove the authority of the agent, by the declaration of the agent. This order was not confirmed, but was repudiated, by the appellant milling company. Neither is there any proof of the agency by the mere fact that the appellee was referred to Mr. Welsh to quote them prices on flour. We assume that Mr. Welsh would have been furnished by the milling company with a list of prices by letter or telegram just as he was when he first called upon the appellee grocery company on August 2d. In this case the testimony for the appellant showed that Mr. Welsh had no authority to make an absolute contract of sale. He was the appellant -milling company’s traveling salesman or “drummer” only, and, as was held by this [456] court in the case of Becker Co. v. Clardy, 96 Miss. 301, 51 So. 211 : “In the absence of express authority, such an agent has authority only to solicit orders and transmit same to his principal for approval.” In this case the order was not approved; consequently there was no binding contract, and the decree below should have been in favor of the defendants. Reversed, and bill dismissed.