Court Opinion

ID: 9545102
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:06:12.590711+00
Date Added: 2024-06-11T15:14:04.970552
License: Public Domain

CAMERON, Judge
(dissenting).
I regret that I must dissent.
This is an action brought by the MyersLeiber Sign Company against W. L. Wei-rich, dba Northern-Aire Lodge and Country Club upon a written contract. The contract is between Myers-Leiber, Inc., and Northern-Aire Lodge and Country Club, Flagstaff, Arizona. The contract was signed by Myers-Leiber by an authorized agent, and:
“Northern-Aire Lodge and Country Club, By /s/ W. L. Weirich .”
Northern-Aire Lodge and Country Club is a fictitious name, and there was testimony to the effect that it was a trade-name of Northern-Aire Development Company, a corporation. Defendant Weirich in his answer, as an affirmative defense, claimed that he signed the contract for and on behalf of Northern-Aire Development Company, a corporation of which he was an authorized agent.
The burden to prove, affirmatively, that the principal-agent relationship was fully and completely disclosed is upon the one asserting such defense. Barrett v. Rumeliote, 126 N.W.2d 322 (Iowa 1964).
The general rule is that unless otherwise agreed, a person purporting to make a contract with another for a partially disclosed principal, is a party to the contract, and the disclosure of an agency is not complete for the purposes of relieving the agent from liability unless the disclosure embraces the name of the principal. Norswing v. Lakeland Flying Service, 193 Or. 91, 237 P.2d 586 (1951).
I agree with the majority opinion that there was sufficient evidence from which the court below could well find that MyersLeiber knew Weirich was an agent of a company, Northern-Aire Development Company. I do not, however, agree that this is sufficient to relieve the agent Wei-rich from the responsibility on the contract which he signed. The fact that Weirich was the agent for Northern-Aire Development Company could not prevent him from making a contract for his own interest with appellant, Myers-Leiber. It was not the duty of Myers-Leiber to determine in which capacity Weirich was signing this contract. The duty was upon Weirich to inform Myers-Leiber of Weirich’s capacity, and if he wished to relieve himself of liability his duty was to notify Myers-Leiber of the name of the principal (in this case Northern-Aire Development Company).
I do not feel that it is asking too much of an agent who would avoid personal liability *538on a written contract, to disclose the name of his principal by his principal’s exact name upon the written contract. The reasons for this are to me quite clear. Only the agent really knows who he intends shall be liable for the performance of the contract. It could well be that the agent intends himself to assume personal liability either alone or jointly with his principal, or it may be that he intends that only his principal shall be liable for the performance of this written contract. If the latter be the case, there is a duty upon him at the time of the contract to clearly indicate to the other party just who shall be liable on the contract the parties are signing. Of course, the easiest way to do this is by placing the exact name of the principal upon the contract and to show clearly that he is signing in a representative capacity rather than an individual capacity. The fact that the other party prepared the contract with an incorrect name does not relieve the agent of the responsibility of correcting the name on the contract thereby informing the other party of the identity of the principal and the party or parties who will he liable for the performance of said contract. Having failed to do this in the instant case, I do not believe that Weirich can now complain when Myers-Leiber attempts to hold him liable for the performance of said contract.
“Since an agent who contracts in his own name, although on behalf of the principal, who fails to use apt language to bind anyone other than himself, is personally liable on the contract thus made, it follows that an agent will be held personally liable on written contracts made by him for an undisclosed principal. In other words, if the agent contracts in his own name he cannot escape liability on the plea that he acted only as agent of another where he did not disclose the other’s identity at the time. Moreover, in this connection, he may not introduce parol evidence to show, with a view to exonerating himself, that he disclosed his agency and mentioned the name of his principal at the time the contract was executed.” 3 Am.Jur.2d Agency, § 318, pp. 675, 676.
For the reasons above stated, I would reverse the decision of the lower court.