Opinion ID: 172063
Heading Depth: 2
Heading Rank: 2

Heading: Evidence of Authority

Text: Next, Ms. Kreisler contends the trial court erred by finding Ms. Flanigan lacked actual or apparent authority to bind CCC to the release. She also claims the court erred by failing to find that CCC ratified the release by its actions. Rule 52 of the Federal Rules of Civil Procedure governs our review of the district court's findings and conclusions. [3] Ms. Kreisler primarily argues that the district court overlooked or mischaracterized certain evidence presented at trial, such that we should overturn the district court's findings. We review a court's conclusions of law de novo. Tosco Corp. v. Koch Indus., 216 F.3d 886, 892 (10th Cir.2000). However, we review Ms. Kreisler's challenges to the district court's findings of fact for clear error, giving due regard to the court's opportunity to judge the credibility of witnesses. See Fed.R.Civ.P. 52(a)(6). This standard of review is highly deferential: If the district court's account of the evidence is plausible in light of the record viewed in its entirety, the court of appeals may not reverse it even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently. Where there are two permissible views of the evidence, the factfinder's choice between them cannot be clearly erroneous. Anderson v. City of Bessemer City, 470 U.S. 564, 573-74, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985). Thus, the question for this court under Rule 52(a) is not whether it would have made the findings the trial court did, but whether on the entire evidence [we are] left with the definite and firm conviction that a mistake has been committed. NLRB v. Viola Indus.-Elevator Div., Inc., 979 F.2d 1384, 1387 (10th Cir.1992) (en banc) (quotation marks and alteration omitted). In this case, the court did not err in finding Ms. Flanigan lacked actual authority to sign the severance agreement Ms. Kreisler altered. Ms. Kreisler contends that if only Mr. Cutler had authority to bind CCC then, logically, the signature line on the agreement would have had his name and title affixed instead of remaining blank. Ms. Kreisler also points to testimony that CCC had no policing process for the agreements. Finally, Ms. Kreisler argues that the fact that Ms. Flanigan skimmed over the agreement, reading parts of it before signing, reveals her authority. However, this evidence is undercut by Mr. Cutler's and Ms. Flanigan's testimony that Ms. Flanigan only had authority to execute approved agreements  the original agreement, in this case. She lacked authority to sign off on any modifications without prior approval from Mr. Cutler. Therefore, the evidence does not establish Mr. Cutler authorized Ms. Flanigan to sign the modified agreement, expressly or otherwise. See Carver v. Farmers & Bankers Broad. Corp., 162 Kan. 663, 179 P.2d 195, 202 (1947). Ms. Kreisler's claims of apparent authority similarly fail. [A]pparent authority of an agent to bind the principal rests upon words or conduct of the principal which leads the third party dealing with the agent to reasonably believe the agent's authority is sufficient to cover the transaction in question. Bucher & Willis Consulting Eng'rs, Planners & Architects v. Smith, 7 Kan.App.2d 467, 643 P.2d 1156, 1159 (1982) (emphasis added). The fundamental defect in Ms. Kreisler's claim of apparent authority is her deposition testimony that she well knew the actual limitations on Ms. Flanigan's authority. According to her deposition testimony, Ms. Kreisler knew Mr. Cutler had to approve any modifications to severance agreements. And Ms. Kreisler admitted familiarity with CCC's process for preparing and executing the agreements and acknowledged that she lacked authority to execute modified agreements without Mr. Cutler's personal approval during her employment at CCC. Ms. Kreisler conceded knowing that Ms. Flanigan also lacked that authority. Finally, Ms. Kreisler admitted surprise that Ms. Flanigan signed the modified agreement because she had expected Ms. Flanigan to take the agreement to Mr. Cutler for approval first. Ms. Kreisler cannot have reasonably believed Ms. Flanigan had authority to sign the modified agreement where she admitted actual knowledge of the limits on Ms. Flanigan's authority. Instead, the evidence shows she knew or should have known Ms. Flanigan's signing of the modified agreement fell outside the scope of her authority. Finally, Ms. Kreisler contends that even if Ms. Flanigan's actions were unauthorized, CCC ratified her conduct by performing its obligations under the agreement. However, Ms. Kreisler misses a basic point. Under Kansas law, ratification only prevents rescission of a contract where, having knowledge of the facts entitling him to rescission of the contract, the party ratifies it. Nordstrom v. Miller, 227 Kan. 59, 605 P.2d 545, 554 (1980) (quotation marks and alteration omitted). In this case, as soon as CCC gained knowledge of the facts permitting rescission  Ms. Kreisler's embezzlement and the unauthorized modification of the severance agreement  CCC repudiated the contract, refusing to provide further benefits pursuant to it. Ms. Kreisler points to no evidence showing otherwise. Instead, she argues CCC's later repudiation of the contract does nothing to negate its initial ratification, but she cites to no authority supporting this proposition. In light of all the evidence presented and the applicable law, the district court did not err in finding that Ms. Flanigan lacked actual or apparent authority to bind CCC to the modified severance agreement and that CCC did not ratify the agreement.