Opinion
Decided February 4, 1930.
The statute of frauds relating to the sale of personal property (P. L., c. 166, s. 4, subd. 1) does not require that the memorandum shall show that the signer acted as agent for the party sought to be charged, and the agency may be shown by parol evidence. A broker is the agent of the party who first employed him, and becomes the agent of the other also, when the latter instructs him to close the bargain. When so authorized he has implied authority to do whatever is necessary and proper to carry his authority into effect, including the signing of the necessary memorandum. A telegram may constitute a sufficient memorandum to satisfy the statute. In a case where the evidence is conflicting and questions as to the existence of a custom and its effect under the circumstances disclosed are submitted to the jury under proper instructions their verdict is final.
ASSUMPSIT, for breach of an alleged contract to purchase a carload of potatoes. Trial by jury and verdict for the plaintiff. Transferred by Scammon, J. on the defendants' exceptions to the denial of their motions for a nonsuit and a directed verdict, to certain rulings of the court upon questions of evidence, to the argument of plaintiff's counsel and to the charge.
There was evidence from which the following facts might be found.
Saturday, October 31, 1925, about two or three o'clock in the afternoon, Lawrence Grimes, a member of the defendant partnership, entered the Boston office of the Federated Fruit and Vegetable Growers, Inc., brokers in fruits and vegetables, for the purpose of negotiating for the purchase of a carload of potatoes. Thereafter the brokers' manager, one Adams, in the presence of Grimes, got in communication by telephone with J. E. Tarbell, president of the plaintiff corporation, which is engaged in raising and shipping potatoes at Smyrna Mills, Maine, and on behalf of the defendants, made an offer of $4.50 per hundred weight for a carload of potatoes f.o.b. Portland, Maine. Tarbell declined to sell at this price, but said he would furnish a carload at $4.70 per hundred weight. Grimes at that time was unwilling to pay the price and Adams asked if plaintiff would keep the offer good for the rest of the day. Tarbell said that he would, and Adams said that if Grimes decided in the meantime to pay $4.70, he (Adams) would telegraph him (Tarbell). Grimes then left the brokers' office but returned later in the day and said that he would take the car at $4.70 per hundred weight. Thereupon Adams said he would wire Mr. Tarbell and caused the following telegram to be sent to the plaintiff.
"Boston, Mass., October 31, 1925. J. E. Tarbell Co., Smyrna Mills, Me. Sold per telephone F E Grimes Dover N.H. car two bushell U S One Mountains four seventy cwt delivered billed to them Portland Maine for divers[i]on draft Dover N H Strafford National Bank. Federated Fruit Vegetable Growers Inc." Interpreted in the light of the testimony, this message meant, — Sold as per our telephone conversation to F. E. Grimes Son, Dover, N.H., one car, 2 bushel sacks, United States standard number 1 Green Mountain potatoes, at $4.70 per hundred weight, delivered, to be billed to them at Portland, Maine, for diversion. Draw draft on them at Dover, N.H. and forward to Strafford National Bank.
Upon the following Monday, November 2, 1925, in response to an inquiry from Grimes, who "wanted to be sure the car of potatoes would be shipped," the following telegram was sent by the brokers to the plaintiff.
"Nov. 2/25 J. E. Tarbell Smyrna Mills Maine. Wire definite confirmation are you shipping Grimes Dover car Potatoes. Federated Fruit Vegetable Growers Inc."
To this the plaintiff replied as follows:
"Smyrna Mills Me. 528P Nov. 2, 1925. Federated Fruit and Vegetable Co. Boston Mass. We considered it a sale when you accepted our offer car mountains two bushel sacks four seventy cwt delivered will ship in a day or two. J. E. Tarbell"
Upon the same day a printed form of confirmation was filled in by the brokers' clerk as follows:
"CONFIRMATION OF ORDER
City Boston, Mass. Date Oct. 31, 1925. Purchaser F. E. Grimes Sons. P. O. Address Dover, N.H. Ship to above, (Portland Me. for Diversion) Route When to Ship Prompt Car Initial later. Car No. Under Grading and Packing Rules of Standard Owner or Shipper (Seller) T. E. Tarbell Co., Smyrna Mills, Maine. (Federated Fruit Vegetable Growers, Inc. is not the shipper or owner, but act as agents only.) Iced or Ventilated Special Instructions Terms Usual Order Taken by Mr. Adams. From Mr. Grimes (Phone to Tarbell)
No. Cars Specifications Price 1 USONE Green Mountains 120# Sacks @ $4.70 per cwt delivered
Kindly sign and return. (Purchase described made basis F.O.B. shipping point unless otherwise noted above.)
Original to Shipper Receipt of this copy of order acknowledges Duplicate to Buyer purchaser's understanding and acceptance Triplicate to Agent of specifications noted above and of terms and conditions shown on back hereof; also of the packing and grading rules under which the commodity is to be delivered.
Upon the back of this form appears the following provision: "The . . . Federated Fruit Vegetable Growers, Inc., is not the owner of the products it offers for sale, but acts only as selling agent for such owner or shipper and is liable only as such agent." Copies of this confirmation were mailed to both the plaintiff and the defendant, but were never signed by either party.
The car of potatoes was shipped by the plaintiff on Wednesday, November 4, and billed to defendants. The invoice was received by the defendants on November 5, and resulted in a telephone call from Grimes to Adams as the result of which the following telegram was sent the plaintiff:
"Nov. 5/25 Mr. J E Tarbell Smyrna Mills Maine Grimes Dover advises us that because you did not definitely answer Saturday and confirm him car Potatoes that he cancels the car Federated Fruit Vegetable Growers, Inc."
The market price of potatoes dropped November 5 to $4.50 per hundred weight. The plaintiff finally caused the carload in question to be sold upon November 20, for the account of the defendants for the sum of $400. Other facts are stated in the opinion.
Conrad E. Snow, Thornton L. Lorimer and H. A. R. E. Shute (Mr. Snow orally), for the plaintiff.
Hughes Burns (Mr. Hughes orally), for the defendants.
Counsel for the defendants stated at the trial that the statute of frauds was the basis of their motions for a nonsuit and a directed verdict. More specifically their claim seems to have been that the plaintiff failed to prove a "note or memorandum in writing of the contract or sale — . . . signed by the party to be charged or his agent in that behalf." P. L., c. 166, s. 4. subd. 1. It was conceded at the oral argument that a telegram may constitute a sufficient memorandum to satisfy the statute of frauds, and this is undoubtedly the law. See note to Brewer v. Company ( 127 Cal. 643) in 50 L.R.A. 240, where many authorities are collected.
No claim is made that the telegram of October 31 does not adequately set forth the terms of the contract. The only fault which the defendants find with it as a memorandum under the statute is that it does not show on its face that the brokers signed as agents for the purchaser. This objection has no basis either in fact or in law. From the language of the message, it might properly be inferred that the brokers signed as agents of the defendants. The statement that the potatoes had been sold to F. E. Grimes Son, Dover, coupled with the reference to the preceding telephone conversation and the direction to draw a draft on them at Dover and forward to a Dover bank, would clearly justify the inference that the brokers, in sending the telegram, were acting for the defendants. But even if the fact of agency did not appear upon the face of the document, it would not, for that reason, be insufficient. The law of this state does not require that a memorandum under the statute shall show that the signer acted as agent for the party sought to be charged. If the signer acted in fact as agent for an undisclosed principal, this may be shown by parol evidence and the principal will be bound by the contract. Usher v. Daniels, 73 N.H. 206, and cases cited; Kingsley v. Siebrecht, 92 Me. 23. The telegram in this case clearly satisfies the requirements of the statute of frauds.
The defendants further contend, however, that even if there was a sufficient memorandum of the contract, the plaintiff's case must fail because "there is no evidence to prove any authority on the part of Adams to represent defendant." It is true, as pointed out in Green v. McCormack, 83 N.H. 509, that a broker's memorandum "does not prove the authority of the broker to execute it," but a complete answer to the defendants' contention is found in another rule of law set forth in that case as follows: "At the outset the broker is the agent of the party who first employed him, but he becomes the agent of the other also, when the latter instructs him to close the bargain, . . . When so authorized he has, like other agents, implied authority to do whatever is necessary and proper to carry his authority into effect, including herein the signing of the necessary memorandum. 1 Mechem, Sales s. 464." It was a proper conclusion from the evidence, that the defendants dealt with Adams as a broker and instructed him to close a bargain for a carload of potatoes at a price of $4.70 per hundred weight. They thus conferred upon him implied authority to sign the necessary memorandum in their behalf.
It is unnecessary, however, in this case, to invoke any theory of implied authority, for the evidence would amply justify a finding that the defendants gave Adams actual authority to sign the telegram in question. If the jury found, in accordance with the plaintiff's evidence, that Lawrence Grimes sat at the elbow of Mr. Adams while he was telephoning to Mr. Tarbell and understood that the plaintiff had given him a firm price of $4.70 per hundred weight, good for that day, that he subsequently notified Adams that he would take the car at that price, and was told by Adams that he would telegraph to Tarbell, then a finding that Adams had express authority to send a telegram to close the bargain would be not only permissible but obligatory. If the above facts were established, the subsequent issuance of an unsigned confirmation by the brokers bearing on its back a statement that they acted only as selling agents for the owner or shipper, would not alter the situation; and a jury might properly regard as mere equivocation the formal denials of Mr. Grimes upon the witness stand that he ever authorized the sending of the telegram to Mr. Tarbell or that he ever authorized the Federated Fruit Vegetable Growers, Inc. to act as his agent.
The defendants also argue that the contract of sale was never completed because no written confirmation of the transaction by the seller was received by them on the day their order was given. They assert that "the uncontradicted evidence was that the custom of the trade demanded that where an oral bid was made it was good for that business day only, and in order to complete the transaction it was necessary that the bid be accepted that day and written confirmation of the sale received from the seller the same day the bid was made, otherwise the sale was incomplete and the transaction was off."
Since the record states that the basis of defendants' motions for a nonsuit and a directed verdict was the statute of frauds, it is doubtful if they are entitled to raise this question now, but we do not care to dispose of it upon this ground. It is sufficient to say that an examination of the record shows that the evidence as to the existence, scope and effect of the trade custom in regard to confirmations was conflicting. The questions of the existence of a custom such as the defendants describe and its effect under the circumstances disclosed by the evidence, were submitted to the jury under instructions which were favorable enough to the defendants, and the verdict determined these issues adversely to them.
Defendants' other exceptions, which have not been argued, appear to be without merit, and are overruled.
Judgment on the verdict.
SNOW, J., did not sit: the others concurred.