Case ID: ad_47/html/0467-01.html
Source: Caselaw Access Project
Author: {"author": "Woodward, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The John Hurd Company, Respondent, v. Consolidated Steel and Wire Company, Appellant.
    
      Payment' to a broker for goods furnished by his principal — when unauthorized,.
    
    Payment of the purchase price of goods by the vendee to the vendor’s broker through whom the sale was made, does not discharge the vendee where he knew the vendor and owner of the goods and had made payment for a portion of the goods directly to him, and where there was no custom or usage in the business warranting payment to the broker who did not have the property in his possession and did not deliver it.
    Appeal by the defendant, the Consolidated Steel and Wire Company, from a judgment of the Supreme Court in' favor of the plaintiff, entered in the office of the clerk of the county of Queens on the 21st day of June, 1899, upon the decision of the court rendered: after a trial at the Queens County Trial Term before the court without a jury.
    
      William F. Goldbeck, for the appellant.
    
      Thomas B. Cotter, for the respondent.
   Woodward, J.:

The plaintiff in this action is a domestic, corporation engaged in the manufacture of lumber. The defendant is a foreign corporation, engaged in making wire goods, etc., at Allentown, Pa., with an office in New York city. It was necessary in its business to have wooden reels for convenience in packing and shipping its product, and it purchased the materials for these reels, sawed, planed, etc., ready to be put together, the work of assembling the parts being done at the factory at Allentown. On the 17th of January, 1895, the defendant had a conversation with one W. A. Crombie, resulting in a written memorandum, which was practically an agreed schedule of prices for goods during the year, and which at most was an executory contract, in which Mr. Crombie agreed to furnish the goods needed by the defendant, and the defendant agreed to receive and pay for them at a given rate for the specified sizes and quantities. There was a stipulation in the memorandum that “ Any material unfit for our use to be thrown out and deducted from your invoices,” and that unless otherwise mutually agreed, the reels are to be manufactured by Mr. Hurd,” meaning, in all probability, the president and general manager of the plaintiff. It appeared upon the -trial that Mr. Crombie had no materials for sale; that he had no .mills, lumber yards, men to handle lumber, or any means of carrying out the agreement except by getting some one else to fill'the contract, and that he was, as a matter of fact, employed as a broker by the plaintiff to procure purchasers for the output of the mills of the latter, and that he was given a commission of five per cent upon the goods shipped and paid for. The plaintiff during the year 1895 and -a portion of' the year 1896 shipped goods to the defendant, the invoices showing that they were sold by .the plain- ’ tiff to the defendant, and the latter paid for the earlier invoices directly to the plaintiff. The orders for the goods were, for the •most part, sent to Mr. Crombie, and by the latter transmitted to the plaintiff; but there is nothing in this inconsistent with the idea that Mr. Crombie was merely a broker in the matter,, and that the orders were passed through his hands for the purpose of informing him of the extent of the business. The trial court very properly held that the executory contract or agreement with Mr. Crombie was not involved in this action; that the contract of- sale in each instance, in the matters sued upon, was between the plaintiff and defendant, and that payment on the part of the defendant to Mr. Crombie, or to the firm .which he represented, could not relieve the defendant from' its obligation to the plaintiff. While the case is complicated by certain .shipments' made on account of Mr. Crombie, and questions growing out of defects in,materials, indirect payments, etc., the main question at issue, and upon which all others hinge, is whether the defendant purchased the goods from Mr. Crombie, under the terms of the memorandum; and, if it did-not, whether the latter was authorized to receive payment for the plaintiff. The learned trial court held as a matter of law that the memorandum with Hr. Crombie was not involved in the proceeding; that the transactions embraced in the ,action were between plaintiff and defendant, and that payments made to Hr. Crombie did not discharge the debt to the plaintiff. If the court was right in so holding, then the judgment should be affirmed, for .a careful consideration of all the matters called to the attention of the court fails to discover reversible error.

The general doctrine is, that a broker employed to sell has no authority as such to receive payment (Higgins v. Moore, 34 N. Y. 417, and authorities cited), and this rule is only departed from when the person contracting for the sale has the property in his possession and delivers it." He is then “clothed with the i/ndioia of authority to receive payment, especially when the owner is not known.” (Higgins Case, supra.) In the case at bar the" owner was known, the person contracting for the sale did not have the property in his possession and did not deliver the same, nor were any of the payments under the early orders made to him. In fact there were no payments made to Hr. Crombie for any of the goods involved in the present action with the consent of the plaintiff, and there was no custom or usage in the business which would warrant the defendant in making payments to Hr. Crombie on account of the plaintiff. There is, probably, ho reason to doubt that the defendant did, in fact, pay Hr. Crombie, supposing that the latter would discharge the obligation to the plaintiff; but that does not afford a good reason why the plaintiff should be defeated in its right to recover for the goods which it has furnished the defendant, and for which it has not been paid. (Hahnenfeld v. Wolff, 15 Misc. Rep. 133.) There is nothing, therefore, to take this case out of the general rule, and the judgment, subject to the stipulation made by the plaintiff, should be affirmed, with costs.

All concurred, except Hirsohbeeg, J., taking no part.

Judgment affirmed, with costs.