Atlee v. Fink

Henry, J.

Plaintiffs sued defendant for balance on. account for lumber sold, $497.68. In his answer, defendant, admits the purchase, but his defense is, that there is in the-account an overcharge of $35, that he' is entitled to a credit-of $184.36, paid on the account, and that plaintiffs owe-him $261, as commission on lumber sold by plaintiffs to defendant’s employers, on defendant’s recommendation, for which he alleges plaintiffs agreed to pay him a commission of two and one-half per cent. All of these allegations were denied by plaintiffs’ replication. The defendant obtained a judgment for $38.73, from'which plaintiffs appeal.

The evidence shows that plaintiffs resided at Fork Madison, Iowa, and were engaged in manufacturing and selling lumber; that they established a branch of theiibusiness at Kansas City, Missouri, and placed J. O’Sullivan in charge of it, to sell lumber. O’Sullivan testifies that he-was employed by plaintiffs to sell their lumber. Samuel Atlee, on.e of plaintiffs, testifies that O’Sullivan was not' authorized to make any agreement to pay commissions to-other persons for selling their lumber. The firm paid O’Sullivan a salary of $1,800 per annum. The defendant,, Fink, testifies that he, O’Sullivan and ~W. H. Atlee, (who-was not a member of the firm of plaintiff's,) were together-when O’Sullivan and defendant made the agreement by which the latter was to receive the commission on sales-O’Sullivan might make to defendant’s employers through defendant’s influence with them; that his employers paid. *103 him for superintending the erection of theyarious buildings erected by them, and it was his duty to keep the laborers at work, and see about materials and all details; that his employers would pay no bills for labor or lumber until certified by defendant to be correct; that he never informed them, or any of them, that he was to get a commission on the lumber purchased by them of plaintiffs. This is the substance of the testimony on the only branch of the case which we deem it necessary to consider.

i. püibtcii al and powers'oí agent, O’Sullivan was not expressly, or by the nature of his employment, authorized to make the contract in question, He was, as he testified, but an agent to sell, and could not delegate that authority to an other. Especially was he not authorized to promise a compensation for sales made for the firm by others, which would bind the firm. Story on Agency, (6 Ed.) § 387; Warner v. Martin, 11 How. 209.

2_. gecret w“h™aÍerseaparty' But it is unnecessary to extend our remarks on that proposition, because, if O’Sullivan had had ample authórity to make such a contract, it is contrary to public policy to allow the plaintiffs to recover on it. He was employed by others to transact business for them, and they paid no bills for lumber not certified by him to be correct, and for two and one-half per c'ent commission on sales to his employers, he sold his influence with them to the plaintiffs. He kept them in ignorance of the agreement he had made with O’Sullivan. That agreement was a temptation to him to certify as correct, bills for lumber which might be incorrect, both as to the amount of lumber and prices charged. His compensation could be increased by such conduct, and it is no answer,.that nothing of the kind occurred. In Fuller v. Dame, 18 Pick. 472, the court said: “ The law avoids contracts and promises made with a view to place one under wrong influences ; those which offer him a temptation to do that which may affect injuriously the right and interest of third persons.” In Spinks v. Davis, 32 Miss. 152, the *104 court said : “ It is a sufficient objection to a contract on tbe ground of public. policy, that it has a direct tendency to induce fraud and malpractice upon the rights of others, or the violation or neglect of high public duties.” One employed by another to transact business for him, has no right to enter into a contract with a third person, which would place it in his power to wrong his principal in the transaction of the business of the latter, and which would tempt a bad man to act in bad faith toward his employer. The interests of the defendant’s employers, and those of plaintiffs, as buyers and sellers, were antagonistic, and defendant could not serve two masters in a matter in which there was such a conflict in their interests. It makes no difference that defendant was not employed to purchase the lumber for his employers. It is enough that it was his duty, under his employment, to examine and certify to the correctness of the lumber bills.

• Under this view, it is wholly immaterial whether the agreement made by O’Sullivan with the defendant was ratified or not by the plaintiffs. The ratification of the contract would not have eliminated the element which rendered it invalid. The trial court entertained a different view of the subject, and embodied, in instructions given, that erroneous view, and refused instructions asked by plaintiffs which declared the law as herein announced, and its judgment is, therefore, reversed and the cause remanded.

All concur.