Case Name: Samuels & Company v. T. M. Gilmore & Company
Court: Kentucky Court of Appeals
Jurisdiction: Kentucky
Decision Date: 1911-02-08
Citations: 142 Ky. 166
Docket Number: 
Parties: Samuels & Company v. T. M. Gilmore & Company.
Judges: 
Reporter: Kentucky Reports
Volume: 142
Pages: 166–171

Head Matter:
Samuels & Company v. T. M. Gilmore & Company.
(Decided February 8, 1911.)
Appeal from Nelson Circuit Court.
1. (Forme® (Appeal! — Hies Judicata. — ¡Tire opinion upon a former appeal is tibe tow of tibie ©ase upon a .second) appeal.
2. Corporation Officer® — 'Clapaciityi bo Malsa Contnact.-H'Wibjeii'e tlie prasideet of a 'corporation was mentally incapable of mialdnig a contract, but -only signed it after tbe terms bad been agreed upon and put in writing under tbe direction of tbe secretary, treasurer and manager, tbe contract was binding upon tbe corporation.
3. ¡Right to Rely Upon Incapacity oí Officer. — In order that a ¡coonporlation may rely upon the mental incapacity of its officer o.r agent to mate a contract on (behalf of the corporation, it must be clearly estalMiishied that the oontraottinig agent did not, at the timie the contract was entered into, have sufficient capacity to hnow and um-derstand what ¡he was 'doing.
4. Suibmifobinig Issue to Jury — (Necessity Of. — Where -there is 'any evidence upon a question in issue, it is error not to submit that question to the jury; but where there is a total failure of evidence to support a given proposition it is error to submit that proposition to the jury.
•MAT W. iHIAUISTHAE, JOiHffSP W, 'UEWCD9 and D. A. McU'AMD'LES'S for appellant.
JIO'HSN A. WUL/DOIN, J. S. KE1IUY and R. C. CHERRY for appellee.

Opinion:
Opinion op the Court by
Judge Mtut/er.
Affirming.
T. M. Gilmore & Company brought this suit against W. B. Samuels & Company to recover commissions for selling 3,266 barrels of whiskey at fifty cents per barrel. The provisions of the contract and tbe several defenses interposed by W. B. Samuels & Company are set forth in detail in tbe opinion of this court delivered upon a former appeal, and may be found in 135 Ky. 706. Tbe answer presented four specific, affirmative defenses: (1) that the writing sued on was not the act and deed of the defendant company, and that it was not bound by the unauthorized act of its president, Mrs. M. A. Samnels; (2) that at the time of the execution of this writing Mrs. Samuels was not competent to contract; (3) that she was overreached and deceived in its execution by T. M. Gilmore, tbe president of tbe plaintiff company; and (4) that the contract was without consideration. Upon the first trial tbe circuit court peremptorily instructed the jury to find for Samuels & Company, which was done, and the petition was dismissed. Upon the appeal this conrt held that a peremptory instruction should have been given tbe jury to find in favor of Gilmore & Company, and reversed tbe judgment for further proceedings. Upon tbe second trial the circuit court peremptorily instructed the jury to find for the plaintiff, Gilmore & Company, which it did; and from a judgment in plaintiff's behalf, the defendant Samnels & Company prosecute this appeal.
The opinion upon the former appeal fully discusses tbe evidence and the law of tbe ease, and it need not be repeated here. It is sufficient to say that on the second trial the evidence was not, in any material respect, different from the evidence heard upon the first trial.
It is conceded by counsel for appellant that the former opinion disposed of the first and fourth defenses above specified; but it is contended that the second defense, which raised the question of the mental capacity of Mrs. Samuels to make the contract, and the third defense, which alleged that she was overreached and deceived in its execution, were still open questions and should have been sent to the jury under proper instructions.
As above stated, thé evidence upon this trial was substantially a repetiton of the evidence upon the former trial, with the exception that appellant introduced three new witnesses, Hall, McLain and Miller, upon the issue raised as to the mental capacity of Mrs. Samuels to make the contract. But their testimony is cumulative merely of the testimony of eight other witnesses who testified upon the same point. Appellant insists, however, that his court never intended, by its opinion upon the former appeal, to deny to appellant the right of a trial by jury upon these two issues; and, in support of that position, it bases its argument, in part, upon the fact that a controlling sentence in the former opinion was modified upon a petition for a rehearing, but that the modification was not known to, or brought to the attention of, the circuit judge or of counsel who tried the case. The modification referred to in the former opinion is found on page 723 of volume 135 of the Kentucky Reports. The original sentence is found in that paragraph of the opinion which deals with the question of the mental capacity of Mrs. Samuels, and reads as follows:
"But, in order that it may avail itself of this right, it must be clearly established that the said contracting agent did not, at the time the contract was entered into, have sufficient capacity to know and understand what he was doing, and that this fact was not known to other officers or agents of the company, or, if known to them, they did not know that such officer was attempting to act or represent the company."
In response to a petition for a rehearing, however, this court struck from the quoted sentence the following portion thereof;" and that this fact was not known to other officers or agents of the company, or, if known to them, they did not know that such officer was attempting to act for or represent the company," thus leaving that sentence of the opinion when corrected, and as the opinion of the court upon this point, to read as follows :
"But, in order that it may avail itself of this right, it must he clearly established that the said contracting agent did not, at the time the contract was entered into, have sufficient capacity to know and understand what he was doing."
"We do not see that this modification of the opinion in any respect strengthens the appellant's position under the' facts of this case and the former opinion, which applied the law under those facts; for it is therein clearly pointed out that this court rested its decision upon the fact that the contract had, in effect, been made by Mrs. Samuel's son, H. M. Samuels, who was the secretary, treasurer and manager of the company. The court not only reached the conclusion that Mrs. Samuels knew and understood what she was doing at the time she signed the contract, but, upon the other branch of the question, it said:
"But even if the evidence led us to entertain a contrary view, and to hold that she did not at that time have mental capacity to contract, still defendant must fail in its contention for the further reason that in its execution the secretary and treasurer of the company, who was also a director and had the active management and control of its affairs, participated. In fact, he assisted in the draft of the contract and discussed its terms and provisions, and not until they were acceptable to him was his mother, the president conferred with in regard thereto. Here, then, we have a contract entered into between plaintiff and defendant in which the defendant is represented not only by the president, whose capacity to contract is questioned but by another officer of the company, her son, H. M. Samuels, who had equal authority to represent it and whose mental ability is in no wise impaired. He and his mother owned practically all of the stock of this corporation. In its welfare and success he was most vitally interested. If he had not wanted the contract executed, or the company had not been satisfied with its terms and provisions, instead of going to his mother and requesting her to enter into it for the company, he should have objected to her signing it; and, if he regarded her as mentally incompetent to transact business, he should have so stated to the plaintiff. ' '
"The fact that he did not object to plaintiff seeing his mother and discussing the matter with her and contracting with her relative thereto is another evidence that he did not regard his mother as incompetent to transact business; and that neither they nor their attorney so regarded her is further evidenced by the fact.that when a few days after the contract had been entered into the company through its president notified Edelen & Co., that they would not carry out the contract, the ground upon which they sought to escape liability was not want of capacity upon the part of its president, who made the contract, but because she had not first obtained authority so to do from the board of directors."
It is clear, therefore, that the former opinion held that although, as a matter of fact, Mrs. Samuels may not have had the mental capacity to understand the contract when she executed it, the presence and joint act of her son, who was secretary, treasurer and manager of the company took the case out of the operation of the rule which avoids a contract entered into by one while mentally incapacitated to do so, because it was, in reality, the act of the manager. In this we think the former opinion was clearly right, and we must adhere to that ruling.
In support of the second ground urged for a reversal that,Mrs. Samuels was overreached and deceived by Gilmore when she signed the contract — it is contended that there is some evidence to support that charge, and that the question should have been submitted to the jury for decision. In the former opinion we said that there was nothing in the record to justify the charge that a fraud was practiced upon the president, M. A. Samuels, in the execution of the contract; and, there is nothing in the record upon this appeal which strengthens the appellant's case in that respect. There is abundant authority sustaining the propositon that where there is any evidence to support a question in issue it is error not to submit that question to the jury; but where there is a total failure of evidence to support a given proposition, it is error to submit that proposition to the jury. Bannon vs. Patrick Bannon Sewer Pipe Co., 136 Ky. 572. Upon the former appeal this court was of opinion that there was no evidence of fraud; and we are of opinion that the ease in that respect is no stronger for appellant upon this appeal. That being true, the circuit judge properly refused to submit that question to the jury.
Appellant assigns a further ground for reversal in the seventh ground for a new trial, which claims that the court erred in its judgment in giving the appellee double the amount it was entitled to recover under the proof. This ground, however, has not been argued either orally or in the briefs, and we are not advised of any specific error committed by the circuit court in that respect. On the contrary, the contract is in writng, and by its terms, it sustains the judgment in every respect.
Wherefore the judgment of the lower court is affirmed with damages.