McClure v. Ullman

BLAND, P. J. (after stating the facts as above).— The court took the case from the jury on the ground that the evidence showed MiltonMcClure perpetrated a fraud on defendant in acting'as agent for both seller and purchaser and for having a secret interest in the purchase. That the evidence disclosed double agency and the practice of deception on defendant, there is no doubt, and it is hardly to be doubted that had McClure disclosed to the defendant his, true relation to the transaction, the contract would not have been entered into by defendant. The temptation to commit fraud is too great to permit one to act as agent for both buyer and seller. This dual relation, if unknown to the seller, makes the contract ab [704] solutely void because against public policy. Chapman v. Currie, 51 Mo. App. 40; Smith v. Tyler, 57 Mo. App. 668; Norman v. Roseman, 59 Mo. App. 682; DeSteiger v. Hollington, 17 Mo. App. 382; Connor v. Black, 119 Mo. l. c. 134; Atlee v. Fink, 75 Mo. 100; Hafner v. Herron, 165 Ill. 242; Young v. Hughes, 32 N. J. Eq. 372; Humphrey v. Eddy Transportation Co., 107 Mich. 163; Hampton v. Lackens, 72 Ill. App. 442; Rice v. Wood, 113 Mass. 133; Holcomb v. Weaver, 136 Mass. 265; Bollman v. Loomis, 41 Conn. 581; Jansen v. Williams, 20 L. R. A. 207; Halsey v. Monteiro, 92 Va. 581; Finch v. Conrade, 154 Pa. 326. The case of DeSteiger v. Hollington, supra, is on all fours with the one at bar. In that case the defendant executed a written contract to sell land. The evidence showed that the agent who procured his signature to the contract was, without the knowledge of defendant, acting also as the agent of the purchaser. On discovery of this dual capacity, the defendant refused to receive the balance of the agreed purchase price, or to execute and deliver a deed to the premises. The suit was to recover damages for a breach of the contract. The trial court refused the following declaration of law asked by the defendant: “Under the law, H. S. Beery could not act as agent for both defendant and plaintiff at the same time without the consent of both parties, and neither the receipt or writing in evidence, nor any understanding or agreement at the time of signing the same, will be binding as between defendant and plaintiff, unless the jury find from the evidence that the defendant had at the time full knowledge that said Beery was acting for and in the interest of the plaintiff. ’ ’ The judgment was reversed for refusal of the court to grant this instruction, the court, through Ellison, Justice, saying: “So jealous is the law as to the relation between principal and agent, that in passing on questions of this character, arising between them, the [705] mere fact of the discovery of no actual fraud or bad faith does not relieve the case in the least. ‘ The cases are nearly if not quite uniform, where the double employment exists and is not known. No recovery can be bad against the party kept in ignorance and the result is not made to turn on the presence or absence of designed duplicity and fraud, but is a consequence of established policy.’ Scribner v. Collar, 40 Mich. 375. The same principle is well espressed in the case of Everhart v. Searle (71 Pa. St. 256). It is said in that case that, ‘it matters not that there was no fraud meditated and no injury done; the rule is not intended to be remedial of .actual wrong, but preventive of the possibility of it.’ ” 2. The contract on which this suit is brought is fair on its face. Its illegality was shown by extrinsic facts. Por this reason it is contended by plaintiff that the defense of fraud was not available under defendant’s answer (a. general denial); that he should have stated the extrinsic facts in his answer to make the defense of fraud available. In Sybert v. Jones, 19 Mo. 86; Moore v. Ringo, 82 Mo. 468, and Musser v. Adler, 86 Mo. 445, it was ruled that a special defense — as that the services sued for were contrary to public policy-should be pleaded. But in Sprague v. Rooney, 104 Mo. 349, it was held that under a general denial, parol evidence was admissible to show that a contract, under seal, was void as opposed to public policy and that in contemplation of law, in consequence of the proven illegality, no contract at all had ever existed. In a later case (St. Louis, etc., Association v. Delano, 108 Mo. l. c. 220) it was held that the defense of illegality of the contract sued on must be specifically pleaded, in the absence of .anything in the petition disclosing such illegality. In McDermott v. Sedwick, 140 Mo. 172, Sprague v. Rooney, supra, is overruled, and the cases of St. Louis, etc., Association v. Delano, Sybert v. Jones, Moore v. Ringo, and Musser v. Adler, supra, were approved. In Mc706 Dearmott v. Sedwick, supra, at page 183, it is said that the common statement of the courts is that, “If it appears from plaintiff’s own showing that the contract arises from an immoral cause, or the transgression of a positive law, the court will at once refuse its assistance. But when the illegality does not appear from the contract itself or from the evidence necessary to prove it, but depends upon extraneous facts, the defense is new matter, and must be pleaded in order to be available.” The illegality of the contract sued on did not appear upon the face of the contract or in the petition, but in making his proof of the contract, plaintiff by his evidence showed that it was illegal, hence it was upon his own showing that the illegality was made to appear, and it seems to us that the manner of showing it is of no consequence. The fact that the plaintiff affirmatively shows it, is the principal thing; when he made this showing, the court very properly refused him its assistance. 3. It is contended that defendant ratified the contract after he became possessed of the fact that McClure, in procuring it, was acting in a double capacity by retaining the twenty five dollars earnest money. The record does not show whose money this was. McClure handed it to defendant and testified he was to furnish one-half the purchase price of the land and his wife the other half, but which of them furnished, the twenty-five dollars is not in evidence and, hence, to whom payment or a tender of payment should be made is left in doubt. If it is McClure’s money, the defendant could not pay it to the plaintiff. It was paid to him as the money of Bradley. Until the McClures agree among themselves as to which of them the money should be paid, defendant ought not to be prejudiced by not having made a prompt tender to either of them. The judgment is affirmed. Reyburn and Goode, JJconcur.