Case Name: FARMERS' LIVE STOCK LOAN COMPANY, Respondent, v. ANDERSON, Appellant
Court: South Dakota Supreme Court
Jurisdiction: South Dakota
Decision Date: 1919-04-18
Citations: 41 S.D. 556
Docket Number: File No. 4491
Parties: FARMERS’ LIVE STOCK LOAN COMPANY, Respondent, v. ANDERSON, Appellant.
Judges: GATE'S, J., concurs in this dissent.
Reporter: South Dakota Reports
Volume: 41
Pages: 556–560

Head Matter:
FARMERS’ LIVE STOCK LOAN COMPANY, Respondent, v. ANDERSON, Appellant.
(171 N. W. 892).
(File No. 4491.
Opinion filed April 18, 1919.
Rehearing denied June 3, 1919.)
Agency — Payee Indorsor, As Agent to Collect for Indorsee, Looking After “Cattle Paper” — Inferences From Facts and Circumstances.
In a suit by indorsee of a negotiable note against the maker, the defense being payment made to payee as indorsee’s agent, held, that evidence disclosing by fair inferences from correspondence between plaintiff and the payee that the latter was authorized, as plaintiff’s agent, to look after paper plaintiff had purchased of payee, and to make collections of same, sufficiently establishes the agency; such inferences being sustained by evidence that, by plaintiff’s direction, payee looked after collection and renewal of paper as plaintiff would have done had it been located where maker lived; and further disclosing that payee was restricted, under his instructions, exactly as a third ■party would have been if acting as its agent. Held, further, that in the absence of direct evidence, proof of agency often rests solely u,pon such inferences.
Smith, P. J., dissenting.
Appeal from Circuit Court, Lyman County. Hon. William Williamson, Judge.
Action by The Farmers’ Live 'Stock Loan Company, a corporation, against L. B. Anderson, to recover judgment upon, and to foreclose, a mortgage securing a negotiable note, plaintiff being indorsee. From a judgment for plaintiff, and from an order denying a new trial, defendant appeals.
Reversed.
Bartine & Bartine, for Appellant.
Brown & Brown, for Respondent.
Appellant cited:
Reid et al v. Kellogg, 8 S. D. 596.

Opinion:
WHITING, J.
Suit to recover judgment on, and to. foreclose a mortgage securing, a negotiable, note given by defendant to one Peter Dirks and by Dirks indorsed to plaintiff. Trial was to court without a jury. Findings and conclusions were entered upon which the court rendered a judgment in favor of plaintiff. From such judgment and an order denying a new trial, this appeal was taken.
Dirks' home was at Oacoma in this state. Respondent was located at Sioux City, Iowa. When the note in question fell due, appellant paid same to Dirks. Dirks died a few days thereafter and without having remitted to respondent. The sole question in this case is: Was Dirks, when receiving the money in payment of such note, the agent of respondent and authorized as such to .collect such note? The evidence presents nothing upon which to base a claim of ostensible agency.
. The trial court undoubtedly was of the opinion, as are the minority of this court, that the facts of this case are such as to bring it under the control of the decision in Astoria Bk. v. Markwood, 38 S. D. 437, 161 N. W. 815.
It is the contention of appellant that the evidence discloses that Dirks was the agent of respondent and as such negotiated loans for respondent, taking the paper in his (Dirks') name and indorsing same to respondent. There is evidence tending to support this contention. Respondent contends that it was in the business, among other things, of purchasing "cattle paper" (notes se cured, by mortgages-on cattle); that Dirks was not its agent authorized as such to negotiate loans for it on "cattle paper"; but that it had purchased such paper from Dirks and: a bank of which Dirks was an officer, just as it purchased like paper from other parties. Without deciding, -we assume, for the purposes of this appeal, that respondent's contention is correct.
We are, however, of the opinion that the evidence does disclose, by the fair inferences to be drawn from correspondence between respondent and Dirks, that Dirks was authorized, as the agent of respondent, to look after paper which respondent had purchased of Dirks and to make collections of same. Proof of agency, in the absence of direct evidence, often rests solely upon inferences to he drawn from facts and circumstances established. No useful purpose would he subserved in setting forth the contents of the numerous letters introduced in evidence. This- evidence shows that, by direction of respondent, Dirks looked after the collection and renewal of paper just as respondent would naturally have done if it had been located at Oacoma. By direction of respondent, 'Dirks was restricted in his actions exactly as a third party, a stranger to the notes, would have been, if acting as its agent. The correspondence was not such as would: be expected to pass between an indorser and indorsee simply because of the indorser's liability. In fact, if one did not know from other sources that Dirks was an indorser on the numerous notes referred to in the correspondence, he would conclude from a reading of many of such letters that Dirks' only relation to these notes and the handling of same was as the agent of respondent.
The judgment and order appealed from are reversed.