Case Name: JACKSON v. GOODMAN
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1976-05-27
Citations: 69 Mich. App. 225
Docket Number: Docket No. 23669
Parties: JACKSON v GOODMAN
Judges: Before: D. E. Holbrook, Jr., P. J., and Mc-Gregor and N. J. Kaufman, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 69
Pages: 225–236

Head Matter:
JACKSON v GOODMAN
Opinion op the Court
1. Rewards — Principal and Agent — Reward Offers — Authority to Contract.
Any individual with the authority to make a contract may offer a reward and be bound by that offer.
2. Principal and Agent — Authority to Contract — Authority to Manage a Business — Incidental Authority.
The authority to contract may be inferred from the authority to manage a business; however, such authority is limited to making contracts which are incidental to such business, are usually made in such business, or are reasonably necessary in conducting such business.
3. Rewards — Principal and Agent — Authority—Factors—Custom of Similar Businesses — Unusual Transactions — Reward Offers — Reasonable Belief.
One of the factors to be considered in determining the extent of the authority of an agent is the custom of similar businesses at the same time and place; however, where the transaction is one unusual to the specific business affected, as in the offer of a reward, the emphasis must differ and significant emphasis must be placed on the course of business conduct in the community at large concerning rewards and on whether the recipient party reasonably believed that the agent was authorized to act and has no notice that the agent was not as authorized.
4. Principal and Agent — Disputed Question of Agency — Jury Question.
A disputed question of agency, if there is any testimony, either direct or inferential, tending to establish it, becomes a question of fact for the jury to determine.
References for Points in Headnotes
[1, 2] 74 Am Jur 2d, Suretyship § 109.
[3, 8, 9] 3 Am Jur 2d, Agency §§ 69-72.
3 Am Jur 2d, Agency §§ 359, 360.
67 Am Jur 2d, Rewards §§ 10, 15.
4 Am Jur 2d, Appeal and Error § 10.
46 Am Jur 2d, Judgments § 118.
74 Am Jur 2d, Suretyship § 29.
5. Rewards — Principal and Agent — Judgment- -Judgment Notwithstanding the Verdict — Sufficient Evidence — Jury Question — Existence of Rewards — Inherent Authority— Authority by Ratification.
A trial court improperly granted a judgment notwithstanding the verdict in a case to collect a reward where there was sufficient evidence to present jury questions concerning the existence of a reward offer and the presence of either inherent authority or authority by ratification in the person offering the reward on behalf of the defendants.
6. Appeal and Error — Circuit Court — District Court — Nonjurisdictional Defects — Waiver.
Nonjurisdictional defects of an appeal filed in a circuit court from a district court may be modified or waived by the circuit court in its discretion; but where such defects are found, the circuit court should not consider the merits of the case; however, a ruling on the merits where there are such defects, will be deemed a waiver of any nonjurisdictional defects (GCR 1963, 705.5[a]).
Dissent by McGregor, J.
7. Judgment — Judgment Notwithstanding the Verdict — Standard of Review — Motions.
A court reviewing a motion for a judgment notwithstanding the verdict must view all the evidence and testimony adduced at the trial in the light most favorable to the person against whom the motion was made, and if, when so viewed, there is any evidence which was competent and sufficient to support the jury’s determination, that determination should not be disturbed.
8. Principal and Agent — Principal’s Liability — Actual Authority — Apparent Authority — Inherent Authority — Authority by Ratification.
A principal is subject to liability for the acts of an agent if it can be said that: (a) the agent was authorized to do the act, (b) the agent was apparently authorized to do the act, (c) the act was within the agent’s inherent authority, or (d) the act was ratified by the principal.
9. Rewards — Principal and Agent — General Manager — Apparent Authority — Inherent Authority — Business Customs— Binding Contracts — Reward Offers.
A general manager can only have the apparent or inherent authority to do those things which managers in that business at that time and place customarily do, and, as such, contracts entered into by general managers are only binding on the principal if they are incidental to a business such as the principal’s, are usually made in such a business, or are reasonably necessary in conducting such a business; therefore it was unreasonable for a third person to assume that a hotel general manager had the authority to offer a reward for information leading to the arrest and conviction of the person responsible for the murder of a hotel employee where there was no actual authority.
10. Rewards — Principal and Agent — Ratification—Affirmance of Prior Act — Failure to Repudiate — Actual Knowledge — Reward Offers.
Ratification is the affirmance by a person of a prior act which did not bind him, but which was done or professedly done on his account, whereby the act, as to some or all persons, is given effect as if originally authorized by him, and in some instances, an affirmance of an unauthorized act can be inferred from the failure of the principal to repudiate it; however, a plaintiff cannot claim ratification of a reward offer where there is no evidence presented to show that the alleged principal had actual knowledge of the reward offer.
Appeal from Oakland, Arthur E. Moore, J.
Submitted March 4, 1976, at Detroit.
(Docket No. 23669.)
Decided May 27, 1976.
Complaint, in district court, by Robert W. Jackson against Albert J. Goodman, Sam H. Goodman, and Hyman Goodman, formerly doing business as St. Regis Hotel Company, to collect a reward offered by the defendants’ agent. The jury returned a verdict in favor of the plaintiff. The trial court entered a judgment notwithstanding the verdict and dismissed the suit against the defend ants. The circuit court affirmed. Plaintiff appeals by leave granted.
Reversed and remanded.
Craig, Farber & Downs, P. C, for plaintiff.
Bornstein & Wishnow, for defendant.
Before: D. E. Holbrook, Jr., P. J., and Mc-Gregor and N. J. Kaufman, JJ.

Opinion:
N. J. Kaufman, J.
The facts are as stated by the dissent. We find that the trial court improperly granted a judgment notwithstanding the verdict because there was sufficient evidence to present jury questions concerning the existence of a reward and the presence of either inherent authority or ratification.
The law governing rewards and the rules defining implied authority are straightforward. It is difficult, however, to apply the precedent governing both areas to the same, unique set of facts. In general, any individual with the authority to make a contract may offer a reward and be bound by that offer. 67 Am Jur 2d, Rewards, § 7, p 6. The authority to contract may be inferred from the authority to manage a business. Such authority is limited to making "contracts which are incidental to such business, are usually made in it, or are reasonably necessary in conducting it". 1 Restatement of the Law, Agency 2d, § 73(a), p 183. One of the factors to be considered in determining the extent of authority is the custom of similar businesses at the same time and place. See 1 Restatement of the Law, Agency 2d, § 34(b), p 118. See also Leo Austrian & Co v Springer, 94 Mich 343; 54 NW 50 (1892), Kopprasch v New York Indemnity Co, 250 Mich 491; 230 NW 909 (1930).
Other courts have presumed authority in the president of a bank to offer, on behalf of the bank, a reward for information leading to the arrest of a defaulting teller, The Bank of Minneapolis v Griffin, 168 Ill 314; 48 NE 154 (1897). Similarly the authority to offer a reward for the arrest of persons maliciously destroying railroad tracks has been held to be within the implied authority of the railroad superintendent. Central Railroad and Banking Co v Cheatham, 85 Ala 292; 4 So 828 (1888).
The conflict resulting from an application of agency principles to the instant case is well illustrated by the divergence between our view and that of the dissent. The basic area of disagreement involves a question of perspective. The dissent views the question of implied authority from the perspective of the business. We view this question from the perspective of the plaintiff, especially that concerning the reasonableness of his reliance on the newspaper article.
Normally, the application of rules concerning usual course of business results in an equitable outcome in line with the parties' expectations, advancement of commercial intercourse and considerations of fundamental fairness. Where the specific business exhibits a general course of behavior relative to the questioned acts, the inquiry generally will give greater focus to the specific concern than to the course of conduct in similar businesses. Where, as here, the transaction is one unusual to the specific business affected, the emphasis must differ. In such a case, significant emphasis must be placed on the course of business conduct in the community at large concerning rewards and on whether the recipient party "reasonably believes that the agent is authorized to [act] and has no notice that he is not so authorized". 1 Restatement of the Law, Agency 2d, § 161, p 378. A jury, as the repository of "community sense", is in a unique position to decide questions of usual course of conduct and reasonable reliance in such unusual cases.
It has long been the policy of this jurisdiction that:
"[w]hen there is a disputed question of agency, if there is any testimony, either direct or inferential, tending to establish it, it becomes a question of fact for the jury to determine." Miskiewicz v Smolenski, 249 Mich 63, 70; 227 NW 789 (1929).
See also Kwasny v Driessen, 42 Mich App 442; 202 NW2d 443 (1972). We, therefore, find that the question of implied agency liability was properly submitted to the jury and that the jury verdict should not have been disturbed.
We also find that there was sufficient evidence of ratification by inaction to present a jury question. The jury could have reasonably disbelieved the testimony of Albert Goodman, who claimed that he read the Detroit News but that he did not know of the reward. The jury could have reasonably held that the owner of a business would be especially attracted to news about that business in a paper which he read.
For the above reasons, we reverse the trial court and circuit court and remand this cause to the trial court for entry of judgment in conformance with the jury verdict. Costs to plaintiff.
D. E. Holbrook, Jr., P. J., concurred.
We concur in the dissent's reasoning and holding regarding the existence of a reward oifer.
In addition to upholding the district court verdict on its merits, the circuit court held that "the appeal was not timely filed, transcript adequately and timely provided, bond filed or briefs filed as required". Our review of the record discloses that plaintiff did timely file his appeal to circuit court. Of the matters found faulty by the circuit court, timely filing is the sole jurisdictional requirement. GCR 1963, 705.5(a). Other defects may be modified or waived by the court in its discretion. GCR 1963, 705.15. Having found the above, the circuit court should not have considered the merits of the case. We, therefore, have deemed the ruling on the merits a waiver of any nonjurisdictional defects.