Court Opinion

ID: 5055326
Source: CourtListenerOpinion
Date Created: 2021-10-01 08:33:12.638661+00
Date Added: 2024-06-11T14:14:16.667431
License: Public Domain

I am unable to agree that when an employment agency calls a prospective employer on the telephone in an effort to place its client, an engineer, and is referred by the prospective employer's president to his subordinate for the stated purpose of an interview with the engineer, the subordinate is thereby, somehow, clothed with apparent authority to hire the employment agency itself. Accordingly, I dissent.
It is undisputed that Sumrall called Anchor Crane seeking to place an engineer, not seeking to place itself. It is undisputed that Sumrall's call was switched to Anchor Crane's President Mays. Sumrall could not remember the substance of the conversation with Mays, but Mays recalled the conversation as:
 The first conversation I had from her was the call that she initially called Anchor Crane was given to me as responsible for hiring, and I informed her that first off, yes, we were interested in an engineer, but first off Mr. Warren would need to interview the person, that he and I would get together later and discuss the salary and so forth. (Emphasis added)
Sumrall did not dispute this recall by Mays in any way in the record. If the doctrine of apparent authority is applied to these undisputed facts, we could only say that Warren's apparent authority, if any, applied to the hiring of an engineer. Sumrall did not call Anchor Crane to get itself hired and Mays did not name Warren, the Works Manager, to interview an employment agency. The entire conduct and conversations of both Sumrall and Mays were devoted to possible hiring of an engineer. Sumrall testified that the subject of hiring or paying a fee to the employment agency first arose in a subsequent conversation with Warren, the purported agent, but fails to testify to any act of Anchor Crane, or its president, clothing the Works Manager with apparent authority to act for Anchor Crane on this new and different subject, i. e., hiring and agreeing to pay an employment agency.
Chastain v. Cooper Reed, 152 Tex. 322, 257 S.W.2d 422
(Tex. 1953) correctly holds that:
 The doctrine of apparent authority is based on estoppel, and one seeking to charge a principal through the apparent authority of an agent to bind the principal must prove such conduct on the part of the principal as would lead a reasonably prudent person, using diligence and discretion, to suppose that the agent has the authority he purports to exercise. Great American Casualty Co. v. Eichelberger, Tex.Civ.App., 37 S.W.2d 1050, writ refused. In this case National Supply Company rests its case upon the conduct of Chastain in permitting Mitcham to make purchases in his behalf from such company on prior occasions.
257 S.W.2d at 427. In our case we do not find "prior occasions," as in Chastain, nor do we find prior conversations relating to subject matter. It would be absurd to say that Anchor Crane's president clothed Warren with authority to hire the engineer when his words were limited to interview the engineer. It would be even more absurd *Page 656 
to say that Anchor Crane's president clothed Warren with authority to hire the employment agency when his words were limited to interview the engineer.
Our case is not one for the application of the doctrine of apparent authority, but instead is a case for the application of the rule that notice to a third party of an agent's limited authority prevents the assertion of any greater authority, including "apparent authority." Sumrall, a third party, cannot actually remember, but does not deny that Mays, Anchor Crane's president, stated to her that Warren, the Works Manager, had the authority to interview, but not to fix the salary of a prospective engineer employee. It cannot be disputed that Warren's authority was "limited" both as to act (interview) and subject matter (engineer); and Sumrall had "notice" thereof. Our supreme court in Douglass v. Panama, Inc., 504 S.W.2d 776
(Tex. 1974) stated that:
 It is also the rule that apparent authority is not available where the other contracting party has notice of the limitation of the agent's power. First National Bank of Coleman v. First National Bank of Brownwood, 278 S.W. 188 (Tex.Com.App. 125); Humble Oil Refining Co. v. Wood, 94 S.W.2d 573
(Tex.Civ.App. no writ hist.); Tex.Jur.2d Corporations, §§ 337-338.
Relying on Douglass, I would hold that since Sumrall had notice of Warren's limited authority to merely interview a prospective engineer employee, Sumrall cannot rely on the doctrine of "apparent authority" to support any other or greater authority, or, more particularly, to support Warren's hiring and agreeing to pay an employment agency.