253 P. 854 | Idaho | 1927
Lead Opinion
The Bowers-Schweitzer Company, Ltd., a corporation, owned and operated the Golden Rule store of Rigby. On December 30, 1921, the company gave a chattel mortgage on its stock of goods, wares and merchandise, furniture and fixtures, to the Inter-Mountain Association of Credit Men, appellant herein, the mortgage providing that the company might continue to buy and sell merchandise in the usual course of retail trade, accounting to the association for the proceeds from the sale thereof, and such proceeds to be applied in reduction of the mortgage debt. On the same day the mortgage was executed the parties entered into what is termed an extension agreement whereby the association was to make an effort to obtain the consent of *543 the creditors of the company to an extension of time arrangement for the payment of their various claims against the company, for which the association was to receive a commission, and the company agreed, in the further conduct of its business, to make purchases from interested creditors and to pay cash therefor.
The Price Produce Commission Company, respondent herein, was one of the creditors of the company, and some months after the execution of the mortgage and extension agreement, to wit, September 7, 1922, it signed and acknowledged an assignment of the amount of its then existing claim against the company to the association, for the purpose of collection, the association being authorized thereby to enforce payment by legal proceedings, in its own name or in any other manner it deemed proper, etc.
In February, 1922, one W.H. LaCoste was placed in the store at Rigby as manager and continued its business, including purchases of merchandise from respondent, and made payments thereon by cash and by check. The bank account of the store was kept in the name of the association and checks were signed "Inter-Mountain Asso. of Credit Men, by Wm. H. LaCoste, Manager," the notation "Bowers-Schweitzer Co., Ltd., General Merchandise, Wm. H. LaCoste, Manager," appearing across the checks.
In March, 1924, respondent filed its complaint in the district court, alleging that appellant association was indebted to it for goods sold and delivered subsequent to the time of the execution of the mortgage and extension agreement, the action being based upon the theory that during the period covering the transactions of respondent with the Golden Rule store for the amount herein claimed to be due, the business was operated by the appellant association through LaCoste as its agent. The contention of the association was, and is, that the business was at all times under the management and control of the Bowers-Schweitzer Company, and that LaCoste was the agent of the Bowers-Schweitzer Company in whatever dealings he had with respondent. *544
The case is here on an appeal by the association from a judgment for respondent based upon a verdict in its favor for the amount claimed. The assignments of error involve the admission and rejection of evidence, instructions given and refused, and the sufficiency of the evidence to sustain the verdict.
Appellant complains of the refusal of the trial court to admit in evidence the minute-book of the Bowers-Schweitzer Company which, appellant claims, showed the employment of LaCoste by the Bowers-Schweitzer Company as its manager. In this we think the court erred, the pivotal question being whether or not in the purchase of the goods LaCoste was the agent of the Bowers-Schweitzer Company or the agent of appellant. This evidence was properly admissible as a circumstance to be considered in determining for whom LaCoste was acting as agent.
It is also insisted that the court erred in refusing to allow the introduction of testimony to explain why the bank account of the Golden Rule store was carried in the name of the Inter-Mountain Association of Credit Men. This was also error, since the court had admitted, and, we think, properly, the bank statements and checks drawn in payment of indebtedness, incurred by the Golden Rule store, and appellant was entitled to have before the jury any and all transactions carried on by LaCoste that had a tendency to establish the fact of the agency of LaCoste and for whom he was acting at the time he purchased the goods the value of which was sought to be recovered by this action. It is difficult to perceive any sound reason for admitting the checks and bank statements in evidence and excluding evidence in explanation of the reason why the account was carried in the name of appellant association, since it would have a tendency to throw light upon the question directly involved, viz., for whom LaCoste was agent. The object and purpose of the introduction of the bank statements and checks was to establish the agency of LaCoste, and to effectuate such purpose all facts were admissible in evidence which had a tendency to throw any light upon the question *545 of the relationship that existed between appellant and LaCoste or between LaCoste and the Bowers-Schweitzer Company.
Appellant further complains of the action of the trial court in permitting respondent, upon cross-examination, to propound to the witness LaCoste the following question:
"Did you at that time and place say in the presence of Mr. Price, Mr. Holden and myself, in answer to a question as to who was operating and who you were working for in the Golden Rule store say, 'I am running the store as manager for the Intermountain Association of Credit Men'?"
Appellant insists that by asking LaCoste the above question it was an attempt to impeach him. Whether it was for this purpose or not, the fact remains that the court, in instruction No. 15, advised the jury "that when the court permitted certain questions (the above question, no doubt, being among those referred to) to be asked of the witness LaCoste regarding his alleged presence at the time of certain alleged conversations, at which it was further alleged that other parties were present, such evidence was not admitted for the purpose of proving the agency of the said LaCoste, but for the purpose of testing the credibilty of the witness LaCoste. If, therefore, you believe that the witness LaCoste during this hearing testified falsely in regard to any material matter, you are entitled to disregard his testimony entirely unless corroborated by some other credible witness or by other credible facts and testimony in the case."
The asking of the question above quoted may not have constituted prejudicial error, but the giving of the instruction quoted did constitute prejudicial error for the reason that respondent made no attempt to prove that in the presence of Price, Holden and Mote, LaCoste made the statement, "I am running the store as manager for the Inter-Mountain Association of Credit Men." Price testified that LaCoste made that statement, but LaCoste denied that he *546
did, and the instruction, therefore, was not a fair one, and we cannot say that, in the absence of any competent evidence of impeachment, the instruction did not influence the jury in rendering the verdict. No doubt the question was asked for the purpose of impeaching LaCoste, but no impeaching testimony was offered, within the provisions of C. S., sec. 8036, and, as was said in State v. Fowler,
C. S., sec. 8036, provides the method by which a party's own witness may be impeached, and should be substantially followed, which was not done in this case, and in our opinion the giving of the instruction objected to was not warranted, and was prejudicial error.
The sole issue in the case is one of agency, the proof of the existence or nonexistence of which frequently must be shown by circumstances. Accordingly a wide range may often be properly given to the evidence, provided that which is offered has a real probative tendency toward the main question in issue. The court should not have permitted the one party to introduce in evidence alleged declarations tending to establish agency on the one hand, in addition to documentary proof in support thereof, and restricted the party seeking to disprove the agency from showing facts having a tendency to refute the claim. *547
We deem it unnecessary to discuss numerous other errors assigned by appellant in view of the conclusion reached that, from a review of the entire record, the cause should be reversed and a new trial granted. It is so ordered. Costs awarded to appellant.
Wm. E. Lee., C.J., and Taylor and T. Bailey Lee, JJ., concur.
Dissenting Opinion
The pivotal question is whether Mr. LaCoste in the purchasing of these goods was agent for the Inter-Mountain Association of Credit Men or the Bowers-Schweitzer Company.
By the clear terms of the chattel mortgage and extension agreement the court should have decided as a matter of law that the business was to be conducted and operated by the Bowers-Schweitzer Company. (Marnella v. Froman,
It is to be borne in mind that the Bowers-Schweitzer Company did not make an assignment for the benefit of creditors to appellant but that it gave security to appellant as trustees for the creditors to secure the indebtedness due its creditors. Under the terms of the chattel mortgage, *548 before the Inter-Mountain Association of Credit Men could have operated the business itself it would have had to acquire the business. Unless, therefore, the Inter-Mountain Association of Credit Men had taken over this business it was not responsible for the debts of the Bowers-Schweitzer Company. The Bowers-Schweitzer Company being a corporation could only transfer its business to the Inter-Mountain Association of Credit Men by a proper corporate act, the record does not show that this was done. (14a C. J., sec. 2446, p. 531, sec. 2460, p. 541.) There was not sufficient evidence in view of the assignment of its 'claim by the respondent, and the agency in the Inter-Mountain Association of Credit Men thus created, to estop the Inter-Mountain Association of Credit Men from successfully asserting that the Bowers-Schweitzer Company and not the Inter-Mountain Association of Credit Men was the real debtor. Appellant had not taken over the business. The Price Produce and Commission Company, was, because of the assignment of its claim, charged with notice of the acts of its agent and also with notice of the legal status and relationship existing between the Inter-Mountain Association of Credit Men and the debtor and therefore charged with notice of the terms and conditions of the chattel mortgage and the extension agreement. The Inter-Mountain Association of Credit Men, as such, was not operating the Bowers-Schweitzer Company, even though it dictated who should be the manager for the purpose of attempting to liquidate the company's indebtedness. The judgment should be reversed and judgment entered for the Inter-Mountain Association of Credit Men. *549