Stine Seed Company v. A & W Agribusiness, LLC
862 F.3d 1094
| 8th Cir. | 2017Background
- Stine Seed sold seed (claimed value ~$279,000) that was planted on J&A Farms land; Stine alleges A&W Agribusiness (A&W) and its principals Williams and Alexander never paid.
- A&W’s operating agreement named Alexander a manager and Williams the sole member (thus holding majority member interests); managers lacked authority to bind the company without member approval.
- Dispute about who arranged credit and purchases: Alexander submitted credit applications and a promissory note to Stine Seed that bear Williams’ apparent signature; Williams denies signing or authorizing those documents.
- Williams admitted purchasing ~100 units of corn and 400 units of soybeans from Stine Seed for his separate farm (RJW) and the district court awarded Stine Seed $28,160 on an implied-in-fact contract for that amount.
- The district court credited Williams’ testimony (finding no signature/authorization/ratification by Williams and that Williams was unaware A&W purchases were made for J&A) and found for A&W on breach-of-contract; Stine Seed appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Williams ratified the Note | Williams ratified expressly (signed July Adjustment) or by conduct after delivery | Williams never signed or authorized signing; no ratification by conduct | No clear error in district court; Williams did not ratify the Note |
| Whether Williams is liable under an implied-in-fact contract for seed planted by J&A | Williams benefited (harvest paid down bank debt he guaranteed), so implied contract exists | Williams was unaware of A&W’s purchase; no mutual assent | No implied-in-fact contract for J&A-planted seed (court credited lack of assent) |
| Whether Williams is liable under unjust enrichment for seed planted by J&A | Unjust for Williams to retain benefit (reduced personal liability) without payment | Williams unaware and was a victim of forgery/agent misconduct; retention not inequitable | No unjust enrichment liability under found facts |
| Whether Alexander had authority to bind A&W to the Note | Alexander had actual and apparent authority to bind A&W | Alexander lacked authority; A&W not bound | Reversed as to A&W: district court clearly erred — admission established Alexander’s apparent authority; remand for breach-of-contract against A&W |
Key Cases Cited
- Meecorp Capital Mkts., LLC v. PSC of Two Harbors, LLC, 776 F.3d 557 (8th Cir.) (federal standard of review for bench-trial findings in diversity case)
- Anderson v. City of Bessemer City, 470 U.S. 564 (U.S. 1985) (trial court credibility determinations generally not clearly erroneous)
- Greater Kan. City Laborers Pension Fund v. Thummel, 738 F.2d 926 (8th Cir.) (trier of fact may visually compare signatures without expert testimony)
- Magnusson Agency v. Pub. Entity Nat’l Co.-Midwest, 560 N.W.2d 20 (Iowa) (agent acts within apparent authority bind principal)
- State Sec. Ins. Co. v. Burgos, 583 N.E.2d 547 (Ill.) (apparent authority principle under Illinois law aligns with Iowa law)