Case ID: nc_160/html/0335-01.html
Source: Caselaw Access Project
Author: {"author": "Clark, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

J. E. LATHAM v. J. E. FIELD & SON.
    (Filed 20 November, 1912.)
    1. Principal and Agent — Broker—Definition—Presumptions—Knowledge Impfied — Vendor and Vendee.
    One dealing with a cotton broker engaged in the business of selling cotton on commission for several firms is presumed to know that the duties of a broker are to bring the seller and the purchaser together in the transaction as vendor and vendee, payment being made directly from the latter to the former; and where it appears that the transaction was made directly between the supposed broker and the purchaser, the bills of lading for the cotton, invoices, etc., being in the name of the former, the one from whom the supposed broker has purchased the cotton for himself cannot be held liable for damages on the ground that the cotton furnished did not come up to specifications, and that he had requested the purchaser to give this broker his business on a former occasion.
    
      2. Same — Evidence—Questions for Jury.
    In an action to recover the difference in value of cotton, on the ground that it had not come up to specifications, alleged to have been bought of the defendant through his broker, there was evidence tending to show that the transaction was made with the alleged broker as an individual transaction, as purchaser of the cotton from the defendant, and as vendor of the plaintiff: Held, that evidence tending to show that the alleged broker received a commission on the sale, i. e., that he was allowed a percentage on the invoice price of the defendant, cannot he held as a matter of law to constitute the one selling the cotton to the plaintiff the defendant’s broker; but under the conflicting evidence an issue of fact is raised for the determination of the jury.
    I-Ioke, X, dissenting.
    Appeal by defendant from darter, J., at April Term, 1912, of Guilford.
    Tbe facts are sufficiently stated in tbe opinion of tbe Court by Mr. Chief Justice Glorie.
    
    
      King & Kimball aavdI Thomas 8. BealD for plaintiff.
    
    
      Douglass & Douglass, J. T. Norris for defendants.
    
   Clark, C. J.

Tbe plaintiff was a cotton merchant in Greensboro, N. C. Tbe defendants were cotton merchants in Oarters-ville, Ga. Shortly prior to May, 1908, tbe defendant "W. H. Field came to tbe plaintiff, in company with one J. D. Turner, a cotton broker in Greensboro, and stated that Turner would represent tbe defendant at Greensboro and that be hoped that the plaintiff would give Turner considerable business. In May, 1908, Latham asked Turner “if be would offer us through any good bouse some strict low middling cotton.” There is evidence that Turner then bought from Field at 9% cents per pound 100 bales of cotton, which Turner sold as “strict low middling” to Latham at 101/1G cents per pound. Latham testified that the entire transaction was with Turner; that he received the invoice and bill of lading from him; that he paid Turner’s draft on him for the cotton, and that he had no communication with the defendants about the transaction until the cotton had been received and paid for by him. The defendants confirmed the sale of the cotton in writing to Turner; invoiced tbe cotton to Turner; made out tbe bill of lading to Turner; shipped tbe cotton to Turner, and drew a draft on him for tbe price of tbe cotton, which was paid.

It was in evidence that Turner was a cotton broker engaged in tbe business of selling cotton on commission for several firms besides tbe defendant.

Tbe plaintiff contends that because of what passed between him and tbe defendant ~W. H. Field, that be supposed and bad a right to suppose that Turner was acting as agent for tbe defendants, and as tbe cotton did not come up to tbe grade represented, be brings this action against tbe defendants for tbe loss.

Tbe first issue is, “Did tbe defendants sell tbe plaintiff 100 bales of strict low middling cotton, as alleged in tbe complaint ?” and tbe second issue is, “If so, did defendants deliver to plaintiff cotton of lower grade and less value than strict low middling, as alleged in tbe complaint ?”

Tbe defendants assign error as follows: Tbe court stated to counsel, in tbe absence of tbe jury, “that be would in substance direct tbe jury to find both tbe first and second issues in favor of tbe plaintiff, if they believed tbe defendants’ evidence,” and defendants’ counsel in consequence did not argue those two issues to tbe jury. In this there was error. Tbe defendant W. II. Field stated explicitly on tbe stand that bis firm bad no communication with tbe plaintiff in regard to tbe sale of this cotton, and did not sell it to tbe plaintiff; that they billed it to Turner and made out tbe invoice to him, and drew tbe draft with bill of lading attached on Turner, and they did not know tbe plaintiff in tbe transaction and bad no dealings with plaintiff in connection with this sale.

Besides, Turner was a broker whose business was merely to bring parties together and who, unlike a factor or commission merchant, does not receive payment for cotton sold. “A broker usually does not have possession, disposal, and control of property, and should sell in tbe name of bis principal. A broker is, strictly speaking, a middleman or intermediate negotiator between tbe parties, and is not in tbe fiduciary relation of an agent to bis principals, but must favor neither the one nor the other of the parties between whom he effects a transaction.” Cyc., 116, 186. “In the absence of proof of custom or usage to the contrary, the broker is not authorized to- receive the payment, and consequently, if the purchaser pays to him and the principal does not receive it, there is no payment to the latter.” 19 Cyc., 299, and cases there cited; A. and E. (2 Ed.), 9'65.

The plaintiff being aware of the duties of a broker as above recited, must have known that he was dealing- with Turner as vendor and not as broker, if this evidence is true.

It is true that the defendant W. II. Field testified that he billed his cotton to Turner for 9% cents, and allowed him one-sixteenth off the invoice price, which would have been. Turner’s commission. He says that he did this because Turner in effect had sold the cotton to himself. It may be that this was a circumstance which together with other circumstances, if left to the jury, might have induced them to find that the cotton was sold to the plaintiff through Turner, as their broker, notwithstanding the evidence above cited. But it was error in the court to hold as a matter of law that there was such sale from the defendants to the plaintiff through Turner as their broker, notwithstanding the denial of W. II. Field,' on the witness stand, of any dealings between his firm and the plaintiff and denial of all knowledge that any one except Turner had any interest in the sale of the cotton.

For this error the defendants are entitled to another trial.

Errror.

IIoKE, J., dissenting.