Humphrey v. Eddy Transportation Co., 107 Mich. 163

Humphrey v. Eddy Transportation Co.

107 Mich. 163 | Mich. | 1895

Grant, J.

(after stating the facts). The plaintiff was the genera] manager, a director and stockholder in, and secretary of the Sulphite Transportation Company, which was the actual purchaser of these boats. The Detroit Dry-Dock Company was only the nominal purchaser, the mere conduit through which the purchase was made by, and the title passed to, the Sulphite Company. -Plaintiff testified that he informed his (the Sulphite) company that the boats were cheap at $120,000, and that early in the negotiations the Detroit Dry-Dock Company offered the Sulphite Company, through plaintiff, a bonus of $5,000 towards the purchase, which was subsequently reduced to- $2,500. None of these facts were communicated by the plaintiff to the defendant. Plaintiff wrote or dictated the telegraphic dispatch above referred to, and induced Mr. McVittie, the agent for the Dry-Dock Company, to sign it, because “I thought it would have more weight, coming from McVittie.” Plaintiff, as agent for defendant, for whom he was bound by law to obtain the best price possible, was in reality purchasing for himself. He therefore had a personal interest hostile to *167the interest of his principal. The law required him to disclose fully to his principal the actual situation, his own interests, and the circumstances of the deal between the Sulphite Company and the Dry-Dock Company, but he gave no testimony to show that he did so.' The onus probandi was upon him. Fountam Coal Co. v. Phelps, 95 Ind. 271; 1 Am. & Eng. Enc. Law, 377, note 1, and authorities there cited. This is one of those contracts which are “opposed to open, upright, and fair dealing, and therefore opposed to public policy.” It is immaterial that the plaintiff acted in good faith, or that the defendant suffered no damage. It is the policy of the law to remove all temptation in an agent to be influenced by his own interest to the detriment of his principal. While, there is some conflict in the authorities as to the right of recov; ery where a plaintiff has acted as agent of both seller and purchaser, with full knowledge that he is so doing, the authorities are uniform in holding that he cannot recover where he withholds knowledge of such relation. 1 Am. & Eng. Enc. Law, 372, 375; Scribner v. Collar, 40 Mich. 375; People v. Township Board of Overyssel, 11 Mich. 222; Dwight v. Blackmar, 2 Mich. 330; Rice v. Wood, 113 Mass. 133; Wadsworth v. Adams, 138 U. S. 380; Brock v. Barnes, 40 Barb. 532, 533. The court should have directed a verdict for the defendant.

Judgment reversed, and a new trial ordered.

The other Justices concurred.