Court Opinion

ID: 3317166
Source: CourtListenerOpinion
Date Created: 2016-07-05 17:34:41.161337+00
Date Added: 2024-06-11T13:56:35.392778
License: Public Domain

Plaintiff sues to recover damages for his discharge from defendant's employment *Page 245 
under a contract in which he agreed to devote, for two years, the whole of his time and attention to the business of the defendant, and diligently and faithfully employ himself therein as a manager of defendant's business of selling gasoline and kerosene at wholesale. Plaintiff offered evidence to prove that he entered into this employment, procured a site on which to erect tanks for this product, negotiated a lease therefor, procured customers, and bought and sold this product. These tanks were equipped with locks to open with keys under the control of the plaintiff at all times during his employment. Defendant offered evidence to prove that the total product handled between the date of plaintiff's employment by defendant, September 20th, 1921, and April 1st, 1922, the date of plaintiff's discharge, was 406,519 gallons, and that the shortage of the gasoline and kerosene during this period was over 12,000 gallons, and after making reasonable allowance for shrinkage on gasoline, the loss was about 8,500 gallons, and because of this loss and plaintiff's failure to explain the loss, defendant discharged him.
The defendant requested and the trial court refused this instruction: "If the jury shall find that while the plaintiff was undertaking to act as manager of the defendant corporation, that the defendant corporation lost some 12,000 gallons or more of gas which was under the care of the plaintiff then it becomes the duty of the plaintiff to satisfactorily explain to the jury the cause for the loss of this large amount of gas." I think defendant was entitled to this charge. The plaintiff was the buying and selling agent of the defendant, in the custody of its product, and in complete charge of its place of business. As custodian of this product he was in a position related to that of a bailee of personal property. The theory of the defendant was that when it appeared that this amount of the *Page 246 
product in the custody of the plaintiff was lost, it became his duty to explain this loss, and in the absence of such explanation the defendant had the right to discharge him for failure to perform his duty as manager diligently and faithfully.
In the case of a bailment, the non production of the goods bailed raises a presumption that their non production is due to the negligence of the bailee. The bailor may rely on this presumption to establish a prima facie case of negligence against the bailee. This prima facie case may be overcome by the bailee by any explanation which shall show that this loss was not due to his failure to exercise reasonable care in the custody of the goods. The authorities are in accord upon this rule of law. Brooklyn Clothing Corporation
v. Fidelity-Phenix [Fidelity-Phoenix] Fire Ins. Co.,205 A.D. 743, 747, 200 N.Y. Supp, 208, thus states the rule: "It is a familiar rule of law that when a bailor calls upon the bailee for the delivery of goods theretofore intrusted to him, the nonproduction of the goods raises a presumption of negligence on the part of the bailee. This presumption can, however, be rebutted by showing that the goods were destroyed by fire, or by theft, providing the fire or the theft was not occasioned by the bailee's negligence." Hunter v. Ricke Bros., 127 Iowa 108, 110,102 N.W. 826; Cumins v. Wood, 44 Ill. 416; Safe DepositCo. v. Pollock, 85 Pa. 391; Davis v. TribuneJob Printing Co., 70 Minn. 95, 98, 72 N.W. 808; Mills
v. Gilbreth, 47 Me. 320, 336; Van Zile on Bailments (2d Ed.) p. 29, § 34, note; 5 Wigmore on Evidence (2d Ed.) § 2508.
A bailment has in it an element of agency, Van Zile on Bailments (2d Ed.) § 43, and an agent for the purchase, custody and care of goods and for their subsequent sale is, in his custody of the goods, in a sense a bailee. When the agent fails to return the goods *Page 247 
upon proper demand, the same rule should hold as in a straight bailment. Proof of the delivery of the goods and of their loss should make out a prima facie case against the agent, rebuttable by him upon showing that the loss was not due to his own failure to exercise due care. This rule is fair to the agent because he has had the opportunity to know what has become of the goods, while it may be quite impossible for the owner to ascertain this, or to show that the loss is due to the negligence of the agent. Such a rule is sometimes mistakenly assumed to change the burden of proof, shifting it from the bailor to the bailee, or from the principal to the agent. It does no such thing. The standard of duty of the agent in the care and custody of the goods remains the same, to exercise reasonable care. What the law determines by this rule is that the proof of delivery and loss raises a presumption that the loss has occurred through the failure of the bailee or agent to use reasonable care. Such proof makes out a prima facie case of negligence on the part of the bailee or agent. Explanation is open to him because he has the best means of explanation; he may overcome this presumption by showing that in fact the loss was not due to his own negligence. The standard of the agent's duty has not changed, nor has the burden of proof been shifted from the principal to the agent. The law has determined that the principal has fulfilled his duty by the mere proof of delivery and loss, which creates a presumption of negligence in the agent and makes out a prima facie case. The burden of proof remains from beginning to end upon the principal.
Cyc., in Volume 31, p. 1467, states accurately the true rule: "An agent who is intrusted with the care and custody of property belonging to his principal becomes a bailee of the property and subject to the ordinary liabilities of such bailees, but this liability *Page 248 
does not arise until the actual delivery of the property to the agent or its constructive delivery whereby he accepts its care. The agent will not be liable if the property is lost, destroyed, or injured without any fault or negligence on his part, or if in keeping and protecting it he exercised ordinary care, skill, and diligence, or such as an ordinarily prudent person would exercise in regard to his own property; . . . and in any case where an agent has property of the principal in his care and custody he will be liable therefor unless he can show that he still has the property or can account for its loss."
In Charlesworth v. Whitlow, 74 Ark. 277, 282,85 S.W. 423, where lumber had come into the appellants' hands and was unaccounted for, the court held: "But whether appellants were remunerated agents, or merely gratuitous bailees, is not material. For in either case they should be held to discover and account for the lumber which came into their hands, and they would be liable for its value unless they could show that they still had the lumber or could account for its loss." See also Darling v. Younker, 37 Ohio St. 487; 1 Mechem on Agency (2d Ed.) § 1344; 2 Corpus Juris, p. 732, § 396.
In my opinion the defendant was entitled to the instruction asked for. Simplicity and certainty will be promoted by having like rules of law to govern like situations.
In this opinion HAINES, J., concurred. *Page 249