99 N.W. 55 | N.D. | 1903
The plaintiff sues the defendant, as an undisclosed principal, to recover the purchase price of certain goods sold and delivered to one Goertz, its alleged agent. When the case came on for trial, and before any evidence was offered, the defendant moved for judgment upon the ground that the complaint fails to state facts sufficient to constitute a cause of action. The motion was granted, and judgment was entered dismissing the action, with prejudice, and for costs. Plaintiff has appealed from the judgment, and assigns the order sustaining the above motion as error.
But a single question is presented for determination upon this appeal, and that is, whether the complaint states a cause of action. Wie are of opinion that it does, and that the motion for judgment should not have been granted. The complaint alleges, in substance, that on and prior to April 22, 1902, one J. H. Goertz was engaged in the general mercantile business at Rosehi'll, in Cavalier county; that on said date he entered into a written contract with the defendant, a copy of which is attached to and made a part of the complaint, whereby, as plaintiff contends, he transferred to the defendant the possession of his entire stock of general merchandise, and also the exclusive control, direction and supervision of said business, and became the defendant’s agent in managing and conducting the same; that he continued in that capacity until about March 1, 1903, when another person was placed in charge; that during the time when Goertz was managing said business for the defendant, to wit, between August 18, 1903, and October 3, 1903, the plaintiff, at the special instance and request of said Goertz, sold and delivered to him goods, wares and merchandise of the reason
It is not disputed that, if the above contract creates the relation of principal and agent between Goertz and the defendant for the purchase of goods, the latter is liable. This follows upon elementary principles, for the law is well settled that, where goods are purchased by an agent without disclosing the name of his principal, the latter may be held liable for the debt when he is discovered.
The validity of the contract is not challenged by counsel for either party. On the contrary, its validity is expressly assumed. As between the parties, this is, no doubt, a proper assumption. Wait on Fraudulent Conveyances, section 353; Greenebaum v. Wheeler, 90 Ill. 296. Whether it is valid as against judgment and attachment creditors of the mortgagor is a different question, and one upon which we need not express an opinion. We agree with the contention of the plaintiff that the contract created the relation of principal and agent between the defendant and Goertz, and that the purchase of goods from plaintiff by Goertz for use in the business was for the benefit of the defendant, and that it is liable therefor. It will be noted that the instrument is not a mere mortgage. If it were, the legal relations of the parties thereto would, of course, be merely that of mortgagor and mortgagee. They saw fit to embody in it additional provisions which are entirely foreign to a chattel mortgage proper, creating rights, obligations and duties different from and additional to those naturally arising out of the relation of mortgagor and mortgagee. If it be a fact that under the terms of the additional contract the defendant became the principal in operating the business — and we are clear that it did — it necessarily subjected itself to the liability of a principal in the purchase of goods by its agent, Goertz. It is not a sufficient answer to a suit against it for. goods purchased for it by its agent that it was at the time of the purchase a mortgagee, and that the alleged agent was a mortgagor. It is true, Goertz had the title to the goods, and
It is said that there is no precedent to sustain a liability upon a state of facts like that which exists in this case. So far as we are advised, this is true. Neither is there a precedent to the contrary. The lack of precedents may be due to the fact that mortgagees of merchandise do not, as a rule, contract with their mortgagors to take over the possession, control and management of their goods and business, and undertake to prosecute the same as a business indefi
The judgment is reversed.