Schlesinger v. Texas & St. Louis Railway Co.

Black, J. The plaintiffs are engaged in the iron, and steel business at New York, Boston and London, under the firm name of Naylor & Company. This suit was brought to recover insurance paid by them for defendant on a cargo of iron from Antwerp to Galveston. The defendant admits the liability for the insurance, but pleads a counter-claim for damages for an alleged failure on the part of plaintiffs to punch the irons in accordance with directions furnished Thorne, who, the. defendant says, was the agent of the plaintiffs. Plaintiffs reply that Thorne was the agent of defendant, and that they punched the iron as directed by him. The judgment was for plaintiffs on the counter-claim. Defendant appealed. In the early part of 1880 Mr. Paramore was at New York seeking to purchase iron for defendant, of which corporation he was president. He there met with Thorne who was a broker in iron and sometimes dealt on his own account. Mr. Paramore received a bid from Thorne for four thousand tons of iron, and also bids from other parties,, came to St. Louis, and, after some correspondence with Thorne, accepted the latter’s bid for the iron, two thousand tons of which were to be German iron. Paramore went to New York, when Thorne handed him a memorandum of sale, written on one of Thorrie’s letter heads, which begins as follows: “Iron and steel rails sold for account of Messrs. Naylor & Co. to the Texas & St. Louis R. R. Co., per J. W. Paramore, Esq., Pres.” It then describes the iron, two thousand tons, and terms of sale, among which it is provided that payment is to. be made in four months, approved London bankers’ acceptance to be furnished immediately on signing the [148] contract, and that the rails are to be punched for first plates and notched according to directions furnished by purchaser. The contract is dated March 3, 1880, and signed, “Chas. H. Thorne,” beneath which is written, “Accepted March 15, 1880, Texas & St, Louis Ry. Co.,. By J. W. Paramore, Pres.” After making' this acceptance, Mr. Paramore was introduced to the plaintiffs by Thorne and at once arranged for the bankers’ acceptance. Thereafter, and in the month of March, Naylor & Company applied to Thorne for directions for punching. Communications were had between Thorne and Para-more, not preserved in the record, but on the twentieth of March, 1880, ^Thorne wrote Paramore, acknowledging .receipt of “punching for rails,” and asked for a drawing to be made by defendant’s engineer, or the Bolt and Iron Company, of St. Louis. Paramore had the drawing made and forwarded to Thorne. On the 27th of March, 1880, Thorne addressed a letter to plaintiffs, giving them directions for punching. There is some confusion in these dates, but the evidence tends to show that Thorne furnished the directions before he received the drawing. At all events the evidence tends to show that the rails were punched with round holes, in strict, compliance with the only directions received by them. Also that Thorne was directed by defendant to have the boltholes made oval. Some of the evidence also tends to show that the drawing and directions sent Thorne by the Bolt and Iron Company indicated round holes, but it is quite clear Thorne knew the holes were to be oval, for he wrote Paramore, on the twenty-ninth of March, that he had given directions to that effect. Mr. Paramore states that he supposed, that he was dealing with Thorne directly, and not as a broker, and had no other-intimation ; that when he made the acceptance of the contract, Thorne desired him to do so, saying that plaintiffs would take the contract off his hands. Plaintiffs’ cashier testifies that his house knew Thorne [149] first in. the early part of 1880, when he called for quotations for two thousand tons of iron for the defendant; ■ that they gave him a price, “f. o. b. Europe,” and afterwards received Mr. Paramore’s order, and arranged' with him for the bankers’ credit. Thorne’s evidence is to the effect that he acted as a broker throughout; he says he applied to the plaintiffs and other dealers for prices and finally consummated the transaction in question ; that he first met Mr. Paramore, or communicated with him and found he was in the market for iron. The court, among others, gave the following instrucT tion, at the request of plaintiffs, of which complaint is made : “The court instructs the jury that a broker for the purpose of signing bought and sold notes is the agent of ■each and both of the parties to the contract which he makes, but in all other respects he is and remains the agent of the party who originally employs him. If,' therefore, the jury find in this case that the defendant first employed the broker, Mr. Thorne,. or first set him in motion on the business involved in this controversy, they are instructed that he was and remained the agent of defendant, so far as any agency resulted from the .above facts, and that any mistakes he may have made in ■conveying to plaintiffs the directions of defendant as to the manner of punching these rails are the mistakes of the defendant’s own agent, and the plaintiffs are not responsible therefor.” For some purposes, as the signing of the contract, the broker is regarded as the agent of both parties. Hence he is accustomed to give the buyer a note, called a sold note, and the seller a like memorandum, called a bought note. Story on Agency (9 Ed.) sec. 28 ; Benj. on Sales, sec. 275. While he represents both parties in making the memorandum, he represents, in all other matters, the party originally employing him. Wharton on Agency, sec. 715. The instruction seems to enunciate correct principles of law, and, taking the contract as the [150] •parties made it, it shows Thorne was acting as a negotiator. He does not profess in it to be a principal, but professes to act for the plaintiff and defendant in the matter of signing the contract. Whatever Mr. Para-more may have supposed, previous to this, the contract shows that Thorne was a middle man in the matter, and in accordance with its terms Mr. Paramore completed the transaction in this shape by arranging with plaintiffs for the bankers’ acceptance. Much of the evidence tends to show that Mr. Thorne was employed by the defendant and that plaintiffs so understood the transaction, for their subsequent dealings, both as to the instructions for punching and the insurance, would indicate this. There was certainly evidence upon which to base the instruction, and the instruction leaves it for the jury to determine who first employed Mr. Thorne. The other instructions given on the one side and the other are to the effect that if defendant did furnish directions through Thorne, and the rails were punched pursuant to such directions, then the finding on the counter-claim should be for plaintiffs, unless Thorne was the agent of plaintiffs. And on the other hand, if the defendant furnished the directions to plaintiffs, or their agent, and those directions were not complied with, the finding should be lor the defendant on the counter-claim. Also, that if the iron was sold to defendant by plaintiffs through Thorne, and he acted as the agent of plaintiffs in such sale and was still their agent when specifications were sent to him, then furnishing specifications to Thome was a compliance with the contract on the part of the defendant. The only substantial evidence going to show that. Thorne was the agent of the plaintiffs is the fact that they paid his commissions* but this, it is shown, is the custom in New York, in such cases. Notwithstanding the custom we think it was evidence to be considered by the jurors. The instructions, it will be seen, leave it as a question of fact for the jurors to determine, as to [151] whose agent Thorne was, both at the time the contract was made and at the time the directions or specifications for punching were furnished. We cannot say there was ■error in submitting the issues tendered by the pleadings. Defendant’s refused- instruction practically directed a verdict and was properly refused. The judgment is affirmed. Tne other judges-concur,