Case Name: Beardsley and another, Appellants, vs. Schmidt and another, Respondents
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1904-02-02
Citations: 120 Wis. 405
Docket Number: 
Parties: Beardsley and another, Appellants, vs. Schmidt and another, Respondents.
Judges: 
Reporter: Wisconsin Reports
Volume: 120
Pages: 405–411

Head Matter:
Beardsley and another, Appellants, vs. Schmidt and another, Respondents.
January 13
February 2, 1904.
.Factors: Principal and agent: Bales by factor: Real party in interest: Trustee of express trust.
1. “An agent employed to sell, or to purchase and sell, goods or other personal property intrusted to his possession, for commission, is a factor.”
'2. It is not essential to the relation of an agent to his principal in respect to the latter’s property, that It should have been consigned directly to him by such principal, in order to give such agent the status of a factor. It is only necessary that the agent shall be possessed of the property with authority from, the principal to sell the same on commission.
•3. By common-law principles a factor has a special property in goods intrusted to his care and in the proceeds of a sale thereof, from which, by implication, arises authority to sell the property in his own name, and to likewise sue to recover the purchase price.
4. As between a factor and his vendor, the former is the owner of the subject of the sale and real party in interest to sue to-recover the purchase price, that not being affected, necessarily, by whether the name of the principal is disclosed to the vendee-before the sale, or the terms of the sale are submitted to the-principal for approval, or the sale is in fact mada in the name of the factor.
5. A factor or person possessed of the goods of another and authorized in respect thereto to make a contract for the benefit of his principal, is trustee of an express trust under sec. 2607, Stats. 1898, and authorized thereby to enforce it in his own name, whether so made or not, such statute expressly providing that he shall be such trustee if the contract is made with Mm or in his own name.
6. Whether the right of a factor to sue in his own name be referred to common-law principles or the statute mentioned, the principal may control the litigation, saving the rights of the factor, unless the latter’s legitimate charges against the subject of the action exceed the amount recoverable.
[Syllabus by Maeshaix, J.]
Appeal from a judgment of the circuit court for Douglas-county: A. J. Vlnje, Circuit Judge.
Reversed.
Action to recover tbe purchase price of a quantity of cement claimed to have been sold by plaintiffs, as factors, to-defendants. Tbe defendants answered, among other things, that plaintiffs were not the real parties in interest. The cause was disposed of wholly on that issue. The evidence in respect to the matter was to this éffect: Plaintiffs, as-warehousemen, received the cement from the Eastern Minnesota Railway Company at West Superior, Wisconsin. Walter T. Bradley & Co., of Philadelphia, were the owners thereof. Some time subsequent to the commencement of' plaintiffs’ possession of such property, they ratified the former’s employment as warehousemen, and paid storage charges on such property. The business of plaintiffs, in part, was that of commission merchants. Some time after they took the property as warehousemen, the owners authorized them by letter to find a market for the cement, and to- dispose of it in large lots if possible, otherwise in small quantities, and to account to' sncb owners from month to month. Some time thereafter such owners informed plaintiffs by letter that their idea was that the latter should take the cement for sale on commission, with authority to use their own judgment as to the best obtainable price. Thereafter defendants made an offer to plaintiffs for the cement, and were informed that it would have to be submitted to the owners. It was so submited, resulting in such owners advising plaintiffs by telegram to accept. The two letters and the telegram referred to constituted all the authority plaintiffs had to make the sale. The name of the owner of the cement was not disclosed in the- negotiations leading up to the sale, nor in the consummation thereof. After the telegraphic advice aforesaid, plaintiffs accepted defendants’ offer and thereafter the cement was delivered to them in three lots, each being receipted for to plaintiffs in their own names. Thereafter the goods were billed to defendants in plaintiffs’ name as the creditors. At the commencement of this action there was owing to plaintiffs their charges for storing the cement for a considerable period of time, and for selling the same.
At the close of plaintiffs’ evidence defendants moved the court to dismiss the complaint. Thereupon the court made findings in accordance with the foregoing, and decided thereon that plaintiffs were not the real parties in interest in respect to the claim involved, and weré not entitled to maintain the action, and that defendants’ motion for a dismissal of the action with costs should he granted. Judgment was ordered accordingly, and was so rendered.
Eor the appellants there was a brief by Fuse, Powell & de Forest, and oral argument by L. K. Luse.
Eor the respondents the cause was submitted on the brief of Archibald McKay.

Opinion:
MaRshaxl, J.
This appeal is governed by a few familiar principles. Tbe trial court seems to bave decided tbe case upon tbe theory that since appellants were agents for tbe owners of tbe cement in making tbe sale, tbe latter are tbe real parties in interest to enforce payment for tbe property by judicial proceedings. Counsel for respondents concedes that if appellants were factors and exercised tbe implied authority incident to such character to sell tbe property, and made tbe sale in tbeir own names, they are tbe real parties in interest to enforce collection of the indebtedness. That has often been ruled by this and other courts, and, indeed, is elementary, and that too without tbe element, necessarily, of a sale in tbe name of tbe factor. Price v. Wisconsin M. & F. Ins. Co. 43 Wis. 267; McGraft v. Rugee, 60 Wis. 406, 19 N. W. 530; Edgerton v. Michels, 66 Wis. 124, 26 N. W. 748, 28 N. W. 408; Kellogg v. Costello, 93 Wis. 232, 67 N. W. 24; Delafield v. Smith, 101 Wis. 664, 78 N. W. 170; McCobb v. Lindsay, 2 Cranch, C. C. 215, Ped. Cas. No. 8,704; Graham & Co. v. Duckwall, 8 Bush, 12; Miller v. Lea, 35 Md. 396; Hearshy v. Hichox, 12 Ark. 125; 8 Ency. Pl. & Pr. 829; Mecbem, Agency, § 1039; Story, Agency, § 112; Reinhard, Agency, § 453. This implied authority of tbe factor to sell in bis own name and to maintain an action in bis own name to recover tbe purchase price grows out of tbe fact that tbe nature of tbe relations between tbe principal and tbe agent, and tbe latter and tbe purchaser, are such that, as between tbe two latter, tbe agent is deemed to be tbe owner of tbe property. He has, as against bis principal, in tbe absence of some stipulation to tbe contrary, a special interest therein and tbe proceeds thereof, and tbe right to control tbe same till be receives bis compensation for services rendered in respect thereto. Story, Agency, § 111. He is also, as to tbe principal, deemed to be a trustee of an express trust under tbe provisions of tbe statute (sec. 2607, Stats. 1898; Reinhard, Agency, § 453; 8 Ency. Pl. & Pr. 829, note 1; Wolfe v. M. P. R. Co. 97 Mo. 473, 11 S. W. 49; Considerant v. Brisbane, 22 N. Y. 394; Bliss, Code Pl. 59), and as sucb is authorized to sue for tbe purchase price by the exception to sec. 2605, Stats. 1898. Sec. 2607, Id., provides:
"A trustee of an express trust . . . may sue without .joining with him the person for whose benefit the action is prosecuted; a trustee of an express trust, within the meaning of this section, shall be construed to include a person with whom or in whose name a contract is.made for the benefit of another."
In either case the principal can control the litigation if •he sees fit, subject to the due protection of the factor's special interest, unless such interest, consisting of legitimate charges against the property, or the proceeds thereof, are equal to •or in excess of the amount recoverable. Keinhard, Agency, § 453; 12 Am. & Eng. Ency. of Law (2d ed.) 691. It is not essential to the right of the factor to sue in his own name that he shall sell in his own name, as counsel seems 'to think, basing his faith on Price v. Wisconsin M. & F. Ins. Co. 43 Wis. 267. It is there said: "A factor selling goods, for his principal in his own name, can sue in his own name for the price," citing Story, Agency, § 110. That text of Story contains no such restriction, — in fact contains^nothing about the right of the factor to sue in his own name. It •seems it was inadvertently referred to in a way likely to mislead. What the author says on the subject is contained in sections 34, 11, 110, 111, and 112, and js to the effect that ra factor has implied authority to sell in his own name and "to sue in his own name for the purchase price of the prop-erty sold, subject, however, to the right of the principal, as before stated, to control the litigation if he sees fit, so far as his own interest is concerned. The right to sue is not put in the conditional in Story; neither is it in the cases decided by this court since Price v. Wisconsin M. F. Ins. Co. supra; Edgerton v. Michels, 66 Wis. 124, 26 N. W. 748, 28 N. W. 408; Kellogg v. Costello, 93 Wis. 232, 67 N. W. 24. By force of tbe statute alone, as we bave seen, a factor bas. tbe right to sue in bis own name. Tbat appears sufficiently from tbe plain language quoted. Moreover, tbat is tbe meaning attributed to similar statutes elsewhere, as will be seen by referring to tbe cited cases. Tbat is not referred to in tbe previous decisions of this court, except in Bobbins v. Deverill, 20 Wis. 142, where nothing definite was said. Since tbat case was decided it bas become well recognized tbat the-code provision bad for its purpose, in part, tbe preservation of the old practice as to factors. Bliss, Code PL 59. It must not be understood tbat a factor is a trustee of an express trust in tbe strict sense of tbe term. He is such under sec. 2607, Stats. 1898, because there in effect so declared. Tbat subject will be found fully discussed in Considerant v. Brisbane, supra.
If it was essential to tbe right of plaintiffs to sue in their own names tbat they should bave sold.in their oivn names, it seems tbat tbe evidence in tbe record is conclusive in their favor. Tbe owners of tbe property were not mentioned in tbe negotiations leading up to tbe sale, nor in tbe consummation thereof, while tbe names of appellants were used on every occasion for using tbe name of any one on tbe side of tbe sellers.
Tbe only question left to be determined, in any view, is r Hid appellants handle tbe property as factors ? A factor is said to be "an agent employed to sell or to purchase and sell goods or other personal property intrusted to bis possession, . . for a compensation commonly called factorage or commission." McGraft v. Rugee, 60 Wis. 406, 19 N. W. 530. "An agent who, for a commission, sells goods for bis principal, which tbe latter bas consigned to him." Rein-bard, Agency, § 449. Tbat seems to accurately describe the-situation of appellants in respect to tbe property in question,. beyond reasonable controversy. True, it was received by them from the railway company, hut they were brought inte contractual relations with the owners thereof thereafter, and acted by express authority from the latter, "to take and handle the property on commission." The fact that respondents' proposition to purchase the property was not acted upon by appellants without submitting the same to the owners of the property for approval is without significance. Possession of the property, with authority to sell it in the capacity of commission merchants, made them factors, with, the implied authority incident thereto, and also made them trustees of an express trust with the right to bring this suit, regardless of whether they received the property directly from the owners, or whether the sale was required to be made upon approval of the owners, or whether the same was so made, or whether they did or did not at the time of the sale disclose the names of the owners. Ilsley v. Merriam, 7 Cush. 242. As soon as appellants assumed in regard to the-property the status of commission merchants, they acquired' a special interest therein which was increased by the continuance of their possession and their services in making the sale, giving them the right, within all the authorities, ta-bring this action and to control the litigation, since there is. nothing to indicate that such control is contrary to the wishes of the owners of the property. It follows that the judgment-appealed from must be reversed.
By the Court. — The judgment is reversed, and the cause-remanded for a new trial.