Opinion ID: 307865
Heading Depth: 2
Heading Rank: 3

Heading: Frosteg as Agent for Columbian.

Text: 47 In entering judgment n. o. v. against Columbian on its claim against the Bank of Camilla, the district court ruled: 48 The evidence adduced upon the trial of this case clearly showed that Frosteg, acting through his company, Pelham Peanut Company, was an agent of Columbian. This is shown by the contract entered into between them, by the testimony of Columbian's manager, and by Frosteg himself. After discovering the forgeries of its agent Columbian voluntarily paid all of the grower-payees whose names Frosteg had forged and by so doing Columbian ratified the acts of Frosteg and it is bound by his fraudulent acts and cannot now recover against The Bank of Camilla as a matter of law. [App. 519, 520.] 49 The first paragraph of the written contract between Columbian and Frosteg's company, Pelham Peanut Company, expresses the gist of their agreement: 50 We have agreed with you that you will buy and store Spanish and Runner Segregation I Farmerstock peanuts in our name and for our account this season, 1970 Crop, at your place of business known as PELHAM PEANUT COMPANY located at Pelham, Georgia, and for such service we agree to pay a fee of $10.00 per net ton for Spanish Farmerstock and $11.00 per net ton for Runner Farmer-stock. [App. 534.] 51 That agreement did not encompass purchases made in the name of Pelham Peanut Company and paid for by Pelham's own check. In so conducting his business, Frosteg departed completely from the scope of his agency for Columbian. When later Frosteg delivered the peanuts or their equivalent to Columbian, and Columbian accepted them thinking that they were peanuts paid for by Columbian's check, Columbian became liable to the growers for the agreed purchase price because Columbian received the benefit of the growers' peanuts. Thus Columbian had become liable to the growers before it discovered the forgeries of Frosteg. Columbian's subsequent payments for the peanuts did not, in our opinion, ratify the fraudulent acts of Frosteg, but was simply performance of its liability incurred before it had any knowledge of Frosteg's fraudulent acts. 52 We conclude that the district court erred in ruling, as a matter of law, that Columbian is not entitled to recover against the banks on its claims that they wrongfully paid Columbian's checks bearing forged endorsements. On that issue the case should stand for a new trial.