74 So. 69 | Ala. | 1917
— On former appeal count 5 was held subject to demurrer. — L. & N. R. R. Co. v. National Park Bank, 188 Ala. 109, 65 South. 1003.
On the second trial, count 5 was amended, and counts A, B, C, D, E, F, and G were added, seeking to recover damages arising out of an alleged conspiracy between Knight, Yancey & Co., and one of the defendant’s agents. Counts H, I, J, and K sought to recover for a fraud alleged to have been perpetrated on the part of defendant’s agents, acting within the line and scope of their authority, and with Knight, Lancey & Co., that estopped the defendant to deny liability. Demurrer was sustained; plaintiff took a nonsuit, and prosecutes this appeal.
The insistence of appellant’s counsel is as follows: “In the outset we wish to impress upon the court that the complaint under consideration is not based upon any right to recover, either under the common law or our statute, upon the issuance alone of the bills of lading by an agént of the company. We recognize that under our decisions the issuance by an agent of a bill of lading covering goods not received for shipment has been held to be ultra vires and not binding the railroad company. We have attempted in drawing the amendment to the complaint to aver clearly, more fully in some counts than in others, the doing by the defendant of a series of acts or a single act in furtherance of the system contemplated by the conspiracy, and that a system or general course of .conduct thus made possible through furtherance of the conspiracy was the proximate cause of the plaintiff’s damage.”
(1) If the conspiracy is properly alleged, and there is also alleged the doing by one of the conspirators of the unlawful act pursuant to the conspiracy, which resulted in the damage, the act so done by any of the participants in pursuance of the original plan and with reference to the common object, is in contemplation of the law the act of all. — Smith v. State, 52 Ala. 407; Jordan v. State, 79 Ala. 9; Williams, et al. v. State, 81 Ala. 1, 1 South. 179, 60 Am. Rep. 133; Amos v. State, 83 Ala. 1; Gibson v. State, 89 Ala. 121, 8 South. 98, 18 Am. St. Rep. 96; Martin v. State, 89 Ala. 115, 8 South. 23, 18 Am. St. Rep. 91; Ex parte Bonner, 100 Ala. 114, 14 South. 648; McLeroy v. State, 120 Ala. 274, 25 South. 247; Sheppard v. State, 172 Ala. 363, 55 South. 514; Watson v. State, 181 Ala. 53, 61 South. 334. In Carlton v. Henry, set al., 129 Ala. 479, 29 South. 924, this court said:
“A doctrine applicable to civil as well as criminal cases is that where two persons enter into a combination to do unlawful act, whatever is done by one as the proximate consequence of furthering the main purpose of the conspiracy, whether specifically in-*197 eluded in that purpose or not, is the act of. both and binds both to responsibility.” — Cooley on Torts, § 143; 8 Cyc. 645. •
That is to say, each conspirator is responsible for everything done by his confederates which the execution of the common design makes probable in the nature of things as a consequence, even though such a consequence was not intended as a part of the original design or common plan. — Jones v. State, 174 Ala. 53, 57 South. 31; Martin v. State, supra; Gibson v. State, supra; Ferguson v. State, 134 Ala. 63, 32 South. 760, 92 Am. St. Rep. 17; Griffith v. State, 90 Ala. 583, 8 South. 812; Morris’ Case, 146 Ala. 66, 41 South. 274; Ferguson v. State, 149 Ala. 21, 43 South. 16. The act, however, must be the ordinary probable effect of the wrongful act specifically agreed on, so that the connection between them may be reasonably apparent, and not an independent product of the mind of one of the confederates outside of or foreign to the common design (Martin v. State, supra, 89 Ala. 115, 8 South. 23, 18 Am. St. Rep. 91, and note; Powers v. Commonwealth, 110 Ky. 386, 61 S. W. 735, 63 S. W. 976, 53 L. R. A. 245; State v. Taylor, 70 Vt. 1, 39 Atl. 447, 42 L. R. A. 673, 67 Am. St. Rep. 684), nor a result growing out of the individual malice, motive, or purpose of the perpetrator, having no relation to the business of the master (Republic I. & S. Co. v. Self, 192 Ala. 403, 68 South. 328, L. R. A. 1915F, 516; Martin v. State, 89 Ala. 115, 8 South. 23, supra; 18 Am. St. Rep. 91, and note; Spencer v. State, 77 Ga. 155, 3 S. E. 661, 4 Am. St. Rep. 74; Powers v. Com., supra).
On former appeal this court said: “If the averment of the conclusion would suffice, and if it stood alone, it does not charge that the act done was within the scope of the employment of the defendant’s agents; but if such was the case, and the pleader, after stating the conclusion, goes further and sets out the facts [showing] that there was no power in the agents the conclusion must yield to the facts set out. * * * Therefore, if it be admitted, but which is not the fact, that the general averment that the things therein referred to as being within the scope of the agent’s employment related to the things to be done in furtherance of the conspiracy, then the facts as specially set up would negative such an averment, under the common law, as it is well settled by the decisions of this and most of the courts of the country that an agent of a public carrier has no authority to issue a bill of lading for goods before the same are delivered for shipment, and that the carrier is not responsible for such unau
The leading cases in which corporations were held as conspirators are: Franklin Union No. 4 v. People, 220 Ill. 355, 77 N. E. 176, 4 L. R. A. (N. S.) 1001, 110 Am. St. Rep. 248; Aberthaw Const. Co. v. Cameron, 194 Mass. 208, 80 N. E. 478, 120 Am. St. Rep. 542; West Va. Transp. Co. v. Standard Oil Co., 50 W. Va. 611, 614, 40 S. E. 591, 56 L. R. A. 804, 88 Am. St. Rep. 895; Zine Carbonate Co. v. First Nat. Bk. of Shullsburg, 103 Wis. 125, 79 N. W. 229, 74 Am. St. Rep. 845; Buffalo Lubricating Co. v. Standard Oil Co., 106 N. Y. 669, 12 N. E. 826; Hobbs v. Boatright, et al., 195 Mo. 693, 724, 93 S. W. 934, 5 L. R. A. (N. S.) 906, 113 Am. St. Rep. 709; Stewart v. Wright, 147 Fed. 321, 325, 326, 77 C. C. A; 499; Id., 203 U. S. 590, 27 Sup. Ct. 777, 51 L. Ed. 330; Hindman v. First National Bank, 98 Fed. 562, 39 C. C. A. 1, 48 L. R. A. 210; Id., 112 Fed. 931, 939, 50 C. C. A. 623, 57 L. R. A. 108; Johnston Fife Hat Co. v. First National Bank, 4 Okl. 17, 44 Pac. 192, 194; Rogers, et al. v. V. S. & P. R. Co., 194 Fed. 65, 114 C. C. A. 85; State v. Salisbury Ice & Fuel Co., 166 N. C. 366, 81 S. E. 737, 52 L. R. A. (N. S.) 216, Ann. Cas. 1916C, 456; Dodge v. Bradstreet Co., 59 How. Prac. (N. Y.) 104. A careful examination of these cases will show that where these several corporations were held liable for conspiracy, the conspiring agent, acting for the corporation, was its corporate officer, or an agent acting within the line and scope of his authority,'and who did for the corporation an act that was essential and necessary to the unlawful transaction or damnifying result.
In the Franklin Union Case was alleged the conspiracy of officers and members of the Union to inaugurate strikes and by a course of violence, threats, intimidation, and force to prevent other persons in the employment of the members of said association from continuing in their employment, the effect of which systematic course of threats and violence was to injure and destroy the business of the members of the association. The holding of the court was that entering into the conspiracy each con
In the Aberthaw Const. Co. Case, injunctive relief was sought against the officers and members of a labor union who were alleged to have formed a conspiracy to compel the plaintiff, under penalty of a general strike, to hire only union workmen.in the prosecution of its contract work. It was held that the fact that one of the conspirators was a corporation gave it no immunity from the consequences of such an unlawful combination.
In West Va. Transp. Co. v. Standard Oil Co., supra, the declaration charged that the plaintiff was engaged in the business of transporting petroleum by means of pipe lines and tank cars, had expended large sums to that end, and that the defendants maliciously and wickedly conspired to injure the plaintiff and ruin its business, and to prevent all persons from transporting oils through plaintiff’s pipe lines and by means of its tank cars. The holding was that a corporation can be guilty with other corporations or persons of a conspiracy that resulted in injury to other corporations or persons. — 50 W. Va. pp. 614, 615, 40 S. E. 591, 56 L. R. A. 804, 88 Am. St. Rep. 895.
The Shullsburg Bank, with others, was charged with conspiracy with the Zinc Carbonate Company, to receive benefits from the sale of certain property. The bank’s secretary and its cashier were alleged to have actively participated to the accomplishment of the fraud. The doctrine was announced that ultra vires was not, in such cases, to be placed in the hands of the corporation itself, or of private individuals, as a means to be used by it or them, for obtaining or retaining something of value which belongs to another.
In the Hobbs and Stewart Cases, the evidence tended to show that the officers of the bank knew the business that Boatright and his associates were engaged in, knew their method of enticing strangers into their net and fleecing them, and with this knowledge lent to Boatright and associates the appearance of respectability that such a banking institution would afford, and allowed the bank to be used by the conspirators to effect the transfer of the money thus fleeced from the victim. The opinion on this point was: “The bank was a necessary link in the scheme to defraud. Its name, character, and influence were constantly employed to give Boatright a false standing with his victims. * * * While it did not decoy the various victims to Webb
In Hindman’s Case, the bank had made a statement concerning the financial condition of its customer in furtherance of the interest of the bank; the petition charged that the bank not only made the false statement to the insurance commissioner of such financial condition, but also conspired through its cashier to repeat the statement to the public in furtherance of the fraudulent scheme or conspiracy. Circuit Judge Taft declared that it was settled law that a corporation may be held for torts in which express malice or intent to defraud is a necessary element, and that a corporation may be held for a conspiracy with others resulting in injury to a third person for acts performed in the course and within the scope of the agent’s employment in the business of the principal. — 98 Fed. 562, 39 C. C. A. 1, 48 L. R. A. 210.
In the second Hindman Case, 112 Fed. 931, 939, 50 C. C. A. 623, 631 (57 L. R. A. 108), Mr. Justice Lurton, distinguishing between actions on contract and actions in tort, said: “How can it be said that, without the authority of the board of directors, the cashier’s action in giving such a certificate would not be the act of the bank ? This is not an action to enforce a contract made by a cashier. * * * If the cáshier’s act is the act of the bank, the liability of the latter for the tort may be plain, although it might not be liable for a promise by the cashier made under the same circumstances. — Morse Bank, § 171; Thompson’s Corp. §§ 4778, 6283.”
In Johnston Fife Hat Co. v. National Bank, supra, the conspiracy alleged was between the hat company and the National Bank of Guthrie, by which the former was to purchase on credit of wholesale dealers, and when the goods so purchased were in store, the bank would, and did, take a spurious mortgage on the same, foreclose it on the fruits of the fraud, and divide the proceeds between the conspirators. The court declared (4 Okl. 25, 44 Pac. 194) that in order to render the bank liable in tort it was not necessary “that it should have authority to take each par
In Roger’s Case, the suit was by a widow and minor child of one who was taken from the parish jail and hanged. The common carrier was held liable for furnishing a special train to the brother of the murdered man, which train of cars was run by defendant from Monroe to the parish jail, and on which gathered, along the way, the individuals who formed the mob that broke the jail and hanged Rogers. The court said: ‘The railroad company was present throughout by its authorized agent, and * * * they knew, or ought to have known, long before the special train reached Tallulah, that the object and purposes of the trip were unlawful.”
In Salisburg Ice & Fuel Co. Case, supra, it was declared that where an agent of a corporation, within the scope of the agency and of the employer’s business, obtains anything of value for the corporation by false pretenses or fraud, the corporation may be made to respond for this fraud exercised for it by such authorized agent.
In Dodge v. Bradstreet Co., supra, it was averred in the complaint that the corporation defendant confederated with the others to injure the plaintiff by circulating false and slanderous statements, with the view of compelling plaintiff to become a subscriber to the corporation’s publication, and that in pursuance of such combination the slanderous words were uttered by the other defendant, and the corporation.
It follows, therefore, that the rule by which liability, is fixed on a corporation for participation in a conspiracy resulting in-injury is not different, in principle, from that imposing liability on the corporation for any other willful or unlawful act that resulted in injury to a third person. In Supreme Lodge of the World, Loyal Order of Moose, v. Kenny, as Adm’r, .198 Ala. 332, 73 South. 519, this court recently said:
‘The following quotation taken from the case of Hardeman v. Williams, 169 Ala. 50 [53 South. 794], found in the recent case of Republic Iron & Steel Co. v. Self [192 Ala. 403]; 68 South. 328 [L. R. A. 1915F, 516], succinctly states the rule as recognized in this case: The principal is responsible for the acts of
The test of the corporation’s liability in conspiracy cases is whether there was authority for doing the act in question by its officer or agent, and, if so, whether the agent acted for the master. Did the corporation conspire ? The corporation can only be held liable for its act done by an agent, servant, or officer, in the particular business in which the corporation and its agent are engaged. If the rule were otherwise, the serious interest of corporations would be jeopardized and often destroyed by the conduct and conspirings of those of their agents or servants engaged in the conduct of the master’s business, who know nothing and care nothing about the policy or the real interests of the corporation, and of whose conduct and conspirings the officer or manager or agent who directs and dictates the policy and the more serious business affairs of the corporation never knew. — Standard Oil Co. v. State, 117 Tenn. 618, 100 S. W. 705, 10 L. R. A. (N. S.) 1015. On reason and authority, therefore, where corporations are held for conspiracy, it must be averred and proven that the conspiracy was entered into by its agent or officer, and that by implied or express authority, such agent or officer was acting within the line and scope of his employment in the accomplishment of the business of the master; and that such agent or officer, as such, did an essential or necessary act which the conspiracy contemplated.
On the former appeal this court pqinted out that the complaint, as then framed, failed to charge that the act done or to be done was within the scope of the employment of the defendant’s agent, that the facts set out in the complaint showed that there was no power in the agent to do the acts alleged to have been agreed on and to be done by him, and that for such reason it failed to charge liability against the defendant. — 188 Ala. 118, 65 South. 1003.
The conspiracy sought to be alleged in the several counts may be generally stated as being between third parties — parties not in defendant’s employ — and defendant’s agent, by which it was agreed or conspired that such third parties, among other things, might at any time thereafter (1905), as they should desire or see fit, and without the delivery of property to the defendant for transportation, issue bills of lading for any amount of cotton, purported to be delivered by said third parties for shipment over defendant’s line for transportation to European ports, and that defendant’s agents would aid and assist in causing deliveries to be made at such European ports of any cotton when shipment was actually made by such third parties subsequent to the issue by them of such spurious bills of lading.
The averment of the acts to be done by such agent in causing deliveries to be made of such cotton as said third parties might ship under any spurious bills of lading issued by them in defendant’s name was as follows: “Defendant, acting by and through the said John A. Bywater, or said other agents of it, whose names to the plaintiff are unknown, and who were the
Consequently no facts are alleged showing acts by defendant’s agents (who are charged with having conspired with Knight, Yancey & Co.), or that such agents were employed by the defendant to do the acts alleged to have been done by them pursuant to the conspiracy, so as to enable the court to determine whether the conspiracy charged was within the scope of the employment of such agents by the defendant. The allegation that the thing to be done by said agents — “to so aid and assist in causing in such manner such deliveries to be made” — was within the scope of the employment by the defendant, is a conclusion of the pleader, and is insufficient, in not showing that the act of conspiring, and the things to be done by the defendant through its said agents, were within the scope of the defendant’s employment of its said agents, and of the prosecution of defendant’s business. — B. R., L. & P. Co. v. Nicholas, 181 Ala. 491, 61 South. 361; Woodward Iron Co. v. Marbut, 183 Ala. 310, 62 South. 804 ; Langhorne v. Simington, 188 Ala. 337, 66 South. 85; L. & N. R. R. Co. v. Jones, 130 Ala. 470, 30 South. 486; Republic Iron & Steel Co. v. Self, supra.
In Alabama Great Southern Railroad Company v. Com. Cot. Co., 146 Ala. 388, 399, 42 South. 406, 407, it is quoted from Jasper Transportation Co. v. K. C., M. & B. R. Co., 99 Ala. 416, 422, 423, 14 South. 546, 42 Am. St. Rep. 75, that: “The statute must not be construed as altering the common law, or as making any innovation therein further than the words import.”
The Grant Case, supra, was practically the case at bar. There the holding was that the master of a ship signing a bill of lading for goods which had never been delivered to him for shipment was not to be considered as the agent of the owner in that behalf, so as to make the owner responsible to one who had made advances to the holder of such bill of lading upon the faith of the bill of lading so signed by the master of the ship.
The delegability of the authority of such an agent in important matters of the principal’s business could not by implication be extended to the general power of affixing the agent’s name to any bill of lading that the third party may see fit to issue without the delivery of the property to the principal so to be transported. The liability of the principal for'such fraudulent bills of lading (those without the receipt of the property), in the absence of knowledge and participation by the principal or its authorized agent, not being declared by our statutes, must be limited by the rule long prevailing at the common law.
As to the transactions alleged to have been had with other third persons, as the discounting of drafts with such bills of lading attached, with which the plaintiff is not alleged to have "been connected, no recovery could be had by-plaintiff, because: (1) Plaintiff was not damaged thereby; (2) defendant was only liable for the act of its authorized agent done within the scope of htis employment, and not for acts done by another (a third party) to which defendant’s agent, as a matter of law, had no authority to agree or consent for the defendant.
Each fraudulent bill of lading so issued, as the result of a conspiracy entered into between Knight, Yancey & Co., the defendant, and others, was a separate and distinct criminal offense or cause ‘of civil action.
The averment of fact that “said Knight, Yancey & Co., between April 7, 1910, and April 30, 1910, made up and issued false and spurious documents purporting to be defendant’s bills of lading, calling for the carriage by defendant and connecting carriers of, to-wit, 1,950 bales of cotton from points in Alabama to Liverpool, England,” in connection with the other averments of fact, falls short of the allegation that, as the result of the alleged conspiracy with Knight, Yancey & Co., the defendant or any of its authorized agents did any act within the line and scope of such agency and the master’s business, in the issuing and uttering of the false and spurious bills of lading between the dates of April 7, and April 30, 1910, covering the 1,950 bales of cotton, to which there were attached the drafts, amounting to $150,000, discounted with plaintiff, in which transaction plaintiff is alleged to have sustained its injuries.
The fact that the defendant and Knight, Yancey & Co. conspired to the end of the issuance of other spurious and fraudulent bills of lading, upon which defendant, through its business associates, assisted in procuring delivery at point of destination, on which damage or loss was, or was not, sustained by other parties than plaintiffs, did not fix liability on defendant for a separate and subsequent issue of spurious or fraudulent bills of lading, on which shipments were not made, and about which neither the defendant nor its agent did any essential or necessary act.
It is not even averred that the defendant or its authorized agents actually knew of the issuance of the bills of lading covering the 1,950 bales of cotton in question, and on which the loan of $150,000 was made and loss sustained. The general averment that, as a part of and in accordance with the terms of said conspiracy, under which 20,000 spurious bills of lading had been formerly issued and uttered and under which defendant had procured delivery of the cotton, was not the equivalent of an averment that Knight, Yancey & Co. were authorized by the defendant or its authorized agents to issue and utter the spurious bills of lading covering the 1,950 bales of cotton in question, and that the defendant knew that the same were to be issued or were issued by Knight, Yancey & Co.
In State, ex rel. Attorney General v. Tally, supra, the effect of the holding was, that to aid and"abet in the commission of a crime the result of a conspiracy, it is necessary that assistance would actually be rendered in its commission by acts or words of encouragement or support, or, when no actual assistance is given, the confederates must be present, actually or constructively, by prearrangement, special or general, at least to the knowledge of the principal, with the intent to render assistance should it become necessary. If a criminal prosecution were pending against the defendant for conspiracy in the matter of the issuance of said spurious bills of lading for the 1,950 bales of cotton, it would not be contended that this defendant or its agent had given assistance by word or act in the consummation of- the fraud, or that, not having given assistance, the corporation’s authorized agent was present by prearrangement, with the knowledge of the principal, with the intent to render assistance
The effect of this additional allegation .is to charge that By-water, by this method of dealing with other bills of lading, previously issued by Knight, Yancey & Co., induced the plaintiff to believe that the bills of lading so issued by that company were genuine bills of lading of the defendant’s, and so to deal with them and to purchase the bill of lading in question on which the plaintiff sustained the loss complained of.
The expression of the court, on former appeal, was to the effect that: “If the agents of the defendant would not have been acting within the line or scope of their employment had they themselves issued such a document, they would not, of course, have been acting with the line or scope of such employment, in attempting to authorize, or in aiding others to do so.”
The effect of the addition of count B was to claim the right to recover, although Bywater could not have issued the bills of lading in question nor have authorized their issuance, on the theory, either that, by consenting to the issue of similar bills of lading on previous occasions he bound the defendant in this instance, or that, though he may not have authorized the issuance of such bills of lading, yet by representing to others that the former bills of lading were authorized, he subjected the defendant to- liability in the present suit by the plaintiff. Thus it is sought by indirection to impress a liability that would not exist if Bywater issued the bills of lading, or authorized their issuance, without receipt of the property purported to have been received for shipment. This contention was heretofore disposed of. — L. & N. R. R. Co. v. Nat. Park Bank, supra, 188 Ala. 119, 65 South. 1003.
Count C contains the same allegations as count B, with the addition that: Said firm of Knight, Yancey & Co. was insolvent, and that the issuance and utterance by them of said spurious documents, in manner and form as aforesaid, would have been discovered long prior to the loss and damage to the plaintiff, which is herein set forth, but for the execution of said conspiracy and the participation of the defendant therein as herein set forth, and as a proximate result of such participation by this defendant, said course of business was continued until, to-wit, April 30, 1910, and this plaintiff’s damages and loss as herein averred was thereby proximately caused.”
Count D is different from count C, in that it alleges.that Bywater was charged with the duties of supervising and conducting the defendant’s shipment of cotton to foreign ports, of issuing or causing to be issued by his subordinates and under his direction, bills of lading for such shipments, of procuring deliveries of cotton under bills of lading issued or purporting to be issued by defendant, of adjusting complaints, inquiries, and difficulties arising between the consignee of such cotton or the holders of bills of lading issued, or purporting to be issued, by the defendant or carriers connecting with the defendant, over whose lines such cotton had been shipped; and also alleges that some of the prior transactions in which Bywater caused deliveries were with plaintiff.
It was thus sought to allege a course of business, established by Knight, Yancey & Co.j and the defendant, by which the former were enabled to sell a large number of their drafts with bills of lading attached. To base an action for fraudulent concealment, a duty to disclose the truth must be shown, that the disclosure was not made when opportunity to speak and inform was presented, and that the party to whom the duty of disclosure was due was induced thereby to act to his injury. — 1 Story, Eq. Jur. § 207, p. 216; 2 Pom. Eq. Jur. § 900; Griel v. Lomax, 89 Ala. 420, 427, 6 South. 741; Hall & Bro. v. Western Assurance Co., 133 Ala. 637, 32 South. 257; Bradfield v. Elyton Land Co., 93 Ala. 527, 8 South. 383; Saltonstall y. Gordon, 33 Ala. 149; Van Arsdale v. Howard, 5 Ala. 598, 602; Greil Bros. Co. v. McLain, 197 Ala. 136, 72 South. 410; Corry v. Sylvia y Cia, 192 Ala. 550, 68 South. 891. In -Fleioellen, et al. v. Crane, 58 Ala. 627, it is said that fraud is a conclusion of law from facts stated and proved. When it is pleaded at law or in equity, the facts out of which it is supposed to arise must be stated; a mere general averment without such facts is not sufficient.- — Skinner v. Southern Gro. Co., 174 Ala. 359, 367, 56 South. 916; Empire Realty Co. v. Hartón, 176 Ala. 99, 57 South. 763; Phoenix Ins. Co. v. Moog, 78 Ala. 301, 56 Am. Rep. 31; Penny v. Jackson, 85 Ala. 72, 4. South. 720.
The additional averment injected in count G, to the effect that Knight, Yancey & Co. committed a series of acts in which defendant’s agents participated, “that would have been discovered long prior to the loss and damage of the plaintiff,” and that their business would have been broken up before the occurrence of the transaction in which plaintiff sustained its loss, etc., is patently bad.
It follows that defendant’s demurrers to amended counts 5, A, B, C, D, E, F, and G, were properly sustained.
It results from the foregoing that the judgment of the Morgan county law and equity court, sustaining defendant’s demurrers to each count of the complaint, to-wit, amended count 5, and counts A to K, inclusive, be and it is hereby affirmed.
Affirmed.
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