Court Opinion

ID: 7891848
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:49:47.346298+00
Date Added: 2024-06-11T16:31:56.472613
License: Public Domain

Bowie, C. J.,
dissented, and delivered the following opinion:
These cases, dépending in a great measure upon the same leading facts, and the same general principles, have been argued, and will be considered together. They present questions of great interest to the commercial community.
The first exception in each, is to the admission of certain letters and telegrams to and from a supposed agent, Mr. Bell, to the plaintiffs, and entries of a deceased clerk of Bell, to show that the contract sued upon, which was made in the name of Bell with the defendants, was made by- him *511as agent of tlie plaintiffs, before the agency was proved “aliunde.”
Tlie second exception in Ford’s case, and third in Artz’, are to the refusal of testimony offered by the defendants, tending to show they gar-e exclusive credit to the supposed agent, Bell, who dealt “suo jure,” and did not disclose his principals; such evidence being offered to show the plaintiff had no right of action.
The third exception in Ford’s case, and fourth in Artz’, are to the rejection of testimony offered by the defendants, of a special usage, existing between a certain class of merchants, and particularly between the appellants and the supposed agent, Boll, which annexed incidents to the contract and governed and controlled it.
The fourth exception in Ford’s, and fifth in Artz’ second case, arise on an instruction given by the Court at the instance of the plaintiff, presenting the same propositions covered by the preceding exceptions. The second and sixth exceptions in Artz’, caso, are peculiar to that, relating to the admissibility of certain witnesses, which will he considered separately.
The contracts declared upon are memoranda in writing, dated “Baltimore, 31st October 1855, and 24th November 1855, respectively,” in the following form, varying only in date and sums:
“For and in consideration of the sum of one dollar, the receipt whereof Is hereby acknowledged, we have this day purchased from John W. Bell and agreed to receive from him, from the 10th to the 20th days of January next, at his option, 1000 barrels of Ohio Super flour, and 1000 barrels Howard- Street Super flour, we paying for the same at the rate of §>9 per barrel, on the day said flour is ready for delivery.” Signed by the defendants, “Oelriehs & Lurman.” To prove those contracts were made by Bell, therein named as agent of the plaintiff's, (the appellees,) they offered in evidence certain letters from the plaintiffs to Bell, and from Bell to the plaintiffs, dated Baltimore 81st Octo*512ber 1855, and the other from the plaintiffs to Bell, dated New York, Nov. 1, 1855, and certain entries on the day book of Bell, in the hand writing of a deceased clerk of said Bell: To the admissibility of which, as proper and competent testimony for the purpose for which they were offered, (it not having been shown that Bell’s testimony could not be procured,) the defendants objected, but the Court overruled the same and permitted it to go to the jury, to which the defendant excepted.
The memorandum or contract being in the name of a third person, not a parly to the suit, the first link in the chain of proof, was evidence of the agency of the person, with whom the contract purported to be made, before the-act of that person could confer a right of action on the plaintiff. The letters and entry excepted.to, are only admissible as declarations or admissions in writing, of a party to the contract, or as part of the “res gestee,” or transaction which was-the subject in controversy. .
Whether the testimony excepted to were declarations or admissions, or “res gestee” of a party to the contract, depended upon the fact of the existence of the relation of principal and agent, between the. plaintiff and Bell. “ Where the acts of the. agent will hind the principal, there his representations, declarations and admissions, respecting the subject matter, will also bind him, if made at the same time, and constituting part of the “res gestee.” They are of the nature of original evidence, and not of hearsay; the representation or statement of the agent in such cases, being the ultimate fact to be proved, and not an admission of some other fact. 1 Greenleaf’s Ev., sec. 113. Story on Agency, secs. 134, 137.
The exception to the evidence is, that it is not proper and competent for the purpose of proving that Bell was the agent of the plaintiff, it not being shown that Bell’s testimony could not be procured. Written and verbal declarations of an agent, when admitted as “res gestee,” are regarded in the nature of original evidence and not hear*513say, because they are assumed to be the acts of the principal. The admissions bind him only when they are made during the continuance of the agency “dum servei opus.” Greenleaf’s Ev., sec. 113. They are verbal acts indicating a present purpose or intention, allowed with the view of illustrating or explaining something equivocal. They are not used to prove the authority of the declarant or writer, when that is in question. That authority must be presupposed, admitted or established before such declarations could be received, otherwise they would be “res inter alios acta.” Their admission is founded on the legal identity of the agent and principal. Id., sec. 114.
Where the evidence is offered as a mere fact, which is connected with the matter in dispute, and not to affect the party otherwise than as the actual existence of the facts affects the nature of the transaction itself, then, although it was a transaction between others, yet, as a mere fact and part of the res gestae, it is evidence. 1 Stark. Ev., 52. Kolb vs. Whitely, 3 G. & J., 198.
The ultimate fact to be proved in tbis instance, was not whether such letters were written or such entries made, but wbetber a contract made in the name of Bell, referred to in those letters, or entries, was made on behalf of the plaintiff. The term hearsay is used with reference to that which is written, as well as to that which is spoken, and in its legal sense denotes the kind of evidence which does not derive its value solely from the credit to he "given to the witness, (or writing,) hut rests also on the veracity and competency of some other person. 1 Phil. Ev., 185. 1 Greenleaf’s Ev., 99. “It is uniformly held incompetent to establish any specific fact, which, in its nature, is susceptible of being proved by witnesses who can speak from their own knowledge.” These letters and entries still rested on the veracity of another or other persons who were not sworn. “That this species of testimony supposes something hotter which might he adduced in the particular case, is not the sole ground of its exclusion Its intrinsic weakness, its in*514competency to satisfy the mind as to the existence of the fact, and the frauds which may be practised under its cover, combine to support the rule, that hearsay evidence is totally inadmissible,” per Marshall, C. J. Queen vs. Hepburn, 7 Cranch., 290, 295.
The application of these principles is forcibly illustrated in a series of decisions in this State. Among the first of these, is the case of the City Bank of Baltimore vs. Bateman, 7 H. & J., 104, it was proposed to prove what.the president of the bank, an acknowledged agent of the defendant for some purposes) said to a sub-officer of the bank as to a particular bag of dollars. The.general rule is explicitly, although incidentally, declared to be, “that where an agency is sufficiently established, the acts and declarations of the agent, within the scope of his authority, are to be considered as the acts and declarations of the principal, of which evidence may be given.” .
In Buckmyer vs. Whiteford, 1 Gill, 127, the plaintiff sought to prove his legal interest in the cause of action (a dishonored draft) by proving a letter written by himself to the cashier of the bank, through which it had passed for collection. .It was net proved that the letter was written on the day it bore date. Waiving this objection, the Court said: “We cannot distinguish between the statements reduced to writing in this letter, and the same statements by the same persons at the same time and under similar circumstances, made verbally.” * * * “If the person, to whom the letter was addressed, had been called to prove the appellee (the plaintiff below) had made to him the same declarations verbally, it would have been in direct violation of that admitted rule of evidence, which prohibits a party from testifying in his own case; and in this case the facts show, that it was made evidence in despite of another principle, which requires the best evidence the nature of the fact affords.” Id., 149.
In Harker vs. Dement, 9 Gill, 16, an action of trover for the conversion of certain slaves, it was proposed to prove that *515Briscoe, tbe supposed agent, at tbe time of taking the property, stated lie came and took the slaves by the authority of the plaintiff. The Court held: “No proof aliunde was offered to show that the plaintiff had invested Briscoe with. authority to sell these slaves, and it is a clear principle, that even if Briscoe had been introduced as a witness, tbe fact of his authority could not have been established by his own declarations.” In support of the last proposition, the case of James vs. Storkey, 1 Wash. C. C. Rep., 330, is referred to.
Washington, Justice, in Blight vs. Ashley, 1 Peters Cir. Ct. Rep., 21, said: “There are certainly some cases where the declarations, or letters of an agent, are proper evidence, and others where he must he examined, and his letters are not evidence if he be alive. The distinction rests upon the principle’, that the best evidence must be produced. If the object is to prove a fact, the agent is the proper person to prove it, and Ms evidence is better than his declarations. If Ms letter contains an acknowledgment of a fact, it is not as good evidence of the fact as proof given by himself. But if the object Is to prove what were the motives or inducements for a man to contract with the agent, what were the statements .made by him, his letters or conversation are proper evidence, not of the facts -stated in them, but that such inducements and statements were made.
The earliest English decisions are in accordance with those of our own Biale.
In Masters vs. Abraham, 1 Esp. Rep., 375, the question was, which party was to find bags for the carriage of hark sold on delivery. To prove the defendant had agreed to furnish the bags, the plaintiff proved the bark had been sold by one Eyre a broker, and produced the letter from Eyre, who was at that time in the box as a witness. It was insisted on the one hand, that Eyre should he questioned as to the facts, and the letter should not be produced; on the other, that Eyre was employed by the defendant who was therefore bound by Ms acts, and his letter was evi*516deuce against his principal. Lord Kenyon said that, as agent, he would admit evidence of what he had done on account of the defendant, but that should be learned from himself, not his letter.
The case of Langhorn vs. Allnutt, 4 Taunton, 516, Lord Mansfield, upon the question of the admissibility of the letters of the plaintiffs’ agents,-held: “It is impossible to find any principle upon which they can be received.” * * * “If the circumstances had arisen at Exeter or London, there would have been no question; no one would have thought of offering letters of a person written at Exeter as receivable in evidence here, and if that is the rule with respect to transactions which take place in England, how can we differ it with relation to the distance at which the transaction takes place. There is no known principle, of law according to which the circumstance of an agent, residing abroad, makes it practicable to give a letter in evidence, which could not be received if the agent lived in England. There is a mode of examining witnesses abroad by commission, though it is tedious and expensive, but notwithstanding those inconveniences, we cannot substitute this for it to the same effect.” Vide Kahl vs. Jansen, 4 Taunt., 571.
Chief Justice Tindall, commenting on this species of evidence, says: “It is dangerous to open the door to declarations of agents, beyond what the cases have already done.' The declaration itself is evidence against the principal, though not given on oath. It is made in his absence, when he has no opportunity to dispute or correct it by any observation or by any question put to the agent, and it is frequently before the Court and jury after a long interval of time. Evidence of such a nature ought always to be kept within the strictest rules to which the cases have confined it.” Garth vs. Howard, 8 Bing., 453.
There is much force in the distinction urged by the appellants’ counsel, between the proof of agency against a principal, and proof of agency by the principal. In the former instance, the evidence, must consist mainly of acts, *517admissions, declarations, conduct or correspondence, tbe actual modo of creating tbe agency being unknown to tbe plaintiff; in tho latter, the plaintiff in proving the agency, is proving his own acts; he is in possession of all the information necessary to establish the fact. Hence, the best evidence in the nature of the case should be required. The party’s admission may be given in evidence against him, but not for him. Letters are blit declarations in writing: if offered in evidence to show a course of dealing, from which agency might he presumed, they would he admissible, their genuineness being proved, provided the're was no better evidence to be adduced.
'Where the correspondence is confined to a single transaction, which is tbe subject of suit, limited to one letter on eacb side, and the agent is not shown to be beyond the reach of tho tribunal in which the suit is pending, such letters of themselves have nono of the moral tests of truth, and to admit them would, in tho language of this Court, before cited, “violate two cardinal rules of evidence, that no man should be a witness in bis own cause, and that tbe best evidence in tbe nature of the case should be produced.” Tbe preponderance of authorities, especially in this State, we think sustains these views. The entry in the day-book of Boll, being cotcmporaneous with the supposed sale, made by a deceased clerk, in the ordinary course of business, would he evidence either for, or against Bell, as the entry of his deceased employee, as between bimself and defendants, but to make them evidence against the defendants at the suit of Ford, it must ho shown they dealt with him as an agent of the plaintiff, and not “suo jure.”
These entries are admitted upon the same theory as the declarations above considered, (the identity of the agent and principal,) when used as a part of the res gestee. The relation of agent and principal must first he assumed, before any connection can he established between such entries and the supposed sale. If Bell’s written or verbal admissions were not evidence, because he was not shown to, he *518the agent, the admissions of his clerk, whether living or dead, could not be. -The act of an agent (the relation of principal and agent being unproved) adds nothing to the weight of the testimony. Public convenience has induced the Courts to relax the rule of evidence to a great extent, in admitting the testimony of agents, clerks, carriers, brokers and servants, but they are not disposed to carry the doctrine of Price vs. Tonington, 1 Salk., 285, any further. 11 M. & W., 775, 776. Walsh vs. Gilmer, 3 H. & J., 383.
The appellants’ second exception in Ford’s case, and third in Artz’, involves the liability of the appellant to the plaintiff, if in dealing with Bell, they dealt with him as principal or as agent, giving exclusive credit to him as such. The.rule is well established that, when from attendant circumstances, it -is clearly manifest that an exclusive credit is given to the agent, and it is intended by both parties that no resort shall in any event be had to any others, than those named in the contract, no other can sue. Story on Agency, sec. 160, a. 268, 400, 423. This results from the right every agent has, on the one hand, to deal in his individual right, or as factor, and the correlative right of others, to deal with the agent in either capacity. The'liberty of the individual to contract, is not restrained by his becoming a commission merchant, factor or broker.
Such being the law, it is incumbent on us to inquire whether there was in the testimony offered sufficient basis for such a defence. When the evidence excepted to was offered, the Court required the defendants to state the purpose for ‘which they offered it, and the defendants stated, “that they did not offer it as touching the question whether Bell was, in fact, the agent of the plaintiff, but as affecting the plaintiffs’ right of action on the contract, and also, as' touching the amount of damages, to which plaintiff was entitled, if he had a right to recover. The Court refused to admit the evidence for either of these purposes. This is an indirect way of raising the question of the effect of giving exclusive credit to the agent, but it seems tó be neces*519sarily involved in the proposition to give it in evidence in bar of the action, and must be presumed to have been brought to the attention of the Court below.” Bullitt vs. Musgrave, 3 Gill, 32.
The objection seems to have proceeded from, the Court, and if the testimony was admissible in bar of the action, upon the ground that it tended lo show that the defendants, in dealing with Bell, gave him exclusive credit, it appears to us it should have been admitted. It is like the case of an instruction offered by the Court “mero moiu,” in which it is held that it must cover all the aspects of the case. “The plaintiffs’ right of action on the contract,” assuming the agency of Bell, could only be disputed on the ground that the defendants gave exclusive credit to the agent Bell.
The testimony tending to show this was, that Bell, at the time of entering into the contract, was a general flour merchant in Baltimore, selling on Ids own account, as well as on commission, and was in excellent standing and credit; that after the absconding of Bell, the defendants demanded, at his store, security for the performance of the contract, and failing to receive it, they at once bought flour to replace that which he had agreed to furnish at §8.75. That the price of flour, in the opinion of the best informed merchants, would riso to §12 per barrel. That the plaintiffs were unknown to the defendants at the time of the contract, and when they disclosed themselves were insolvent merchants, without any credit or standing', and non-residents of the State, and they refused to give them credit or take them for the contract, unless they would give security for the contract.
Whether the appellants gave exclusive credit to the agent, Bell, was a question for the jury. Thompson vs. Davenport, 9 Barn. & Cres., 78. Without encroaching on their province, it is not too much to say, it had a tendency to prove that fact. To exclude such testimony from their consideration, was to deprive the appellant of the privilege of asking an instruction based upon the hypothesis which such evidence might have warranted. There is a *520strong legal presumption that, as a question of intention, credit is given exclusively to the agent in such cases. Story on Agency, 268, 290.
The 3d and 4th Exceptions. The appellant, after the plaintiff had closed his case, offered again the testimony set forth in the second bill of exceptions, and in addition thereto offered to prove “the existence of an usage among a certain class of flour dealers in Baltimore city, accustomed to deal in contracts for that article, under which either the buyer or seller in such contracts might demand security, by way of a margin, to be put up by both, whenever the faithful performance of such a contract should be considered doubtful by either party; * * * that the existence of this usage was well known to the defendants and to Bell; that it was a special usage of each of them in their business; that they had each of them admitted it to be such, and in a conversation between them, had stated to each 'other that all their contracts, respectively, were made subject to and in reference to the usage," &c. The authorities distinguish between a general usage, so well established that the knowledge and adoption of it is presumed, from the fact of its existence, of which the Courts, ex officio, take notice, and special or particular usages, which must be shown to have been known to and adopted by the parties to the contract, and which, however local or partial, when proved to be so known and adopted, will control the contract. The-former must be general in the whole city or place, or among all persons in the trade, and not the usage of a particular class only, or the course of practice in a particular bank, to whom, or which, the party is a stranger. Gabray vs. Lloyd, 3 B. & C., 793. 6 H. & J., 172. 1 H. & G., 248. Mer. Mut. Ins. Co., vs. Wilson, 2 Md. Rep., 240. In Foley & Woodside vs. Mason & Son, this Court said: “And, in any case, a usage to be admissible must be proved to be known to the parties, or bo so general and well established that knowledge and adoption of it must be presumed, and it must be certain and uniform. Indeed it may be *521added that usages, in general, have fallen in later years much into disfavor with the Courts as they have been disliked and discountenanced in earlier times by the ablest of judges;” citing in support of this position Stover vs. Whitman, 6 Binney, 416, Chief Justice Tilghman; and Donnell vs. Ins. Co., 2 Sumner, 366, by Story, Justice. “The evidence of usage in this case washeldtoo vague and unmeaning, to warrant, upon any principles, the Court to submit any proposition!» the jury based rrpon it.” * * * “In this particular, this case is wholly unlike the case of Powell vs. Bradlee, 9 G. & J., 221; there, one witness proved that it was then and now is, the general usage among flour merchants in the City of Baltimore, it is the general and constant usage; upon this evidence the Court said very properly, that the question. of usage was rightly left to the jury.” 6 Md. Rep., 50. The effect of usage, on certain clauses of a policy of insurance, being under consideration, in the ease of the Merchants Mutual Ins. Co., vs. Wilson, 2 Md. Rep., 217, this Court after reviewing all the previous decisions in this State on the subject, adopts the language of Duer on Ins., as follows: “The proposition that a usage must be general in order to bind the parties, refers exclusively to the cases in which the knowledge of the parties and their intention to adopt the usage are inferred merely from the fact of its existence, but when their knowledge or intentions aro established by other direct or circumstantial proof, their contract will be governed by the usage, however local or partial, in reference to which it is proved or presumed to have been made.” Vide also Grove vs. Brien, 1 Md. Rep., 438. Burroughs vs. Langley, 10 Md. Rep., 250. Notwithstanding the disfavor expressed towards this species of evidence, its claims to consideration are so established and admitted, that we cannot without judicial legislation, exclude it, when it is presented. The judges who deprecate its admission, still acknowledge its authority. Recognizing these precedents, the evidence of usage offered by the appellants was not admissible as a general usage, so well *522known and established, that its knowledge and adoption as a part of the contract, would be presumed, because in the tender of evidence it was described as “an usage among a certain class of flour dealers in the City of Baltimore,” thus negativing that generality which the decisions require as a basis of the presumption of its adoption; but the appellee further offered to prove, that the usage was in existence at the time the contract was made, was well known to the appellants and said Bell, had a well known and recognised meaning, and imputing security, in the shape of money to be put up by both parties, had been acted upon previously in numerous cases of time contracts for flour in Baltimore City, where the contract was in writing, and no reference was made in it to the usage; “that it was well known to the appellants and Bell, it toas a special usage of each of them in their business, that they had each of them admitted it to be such, and in conversation between them, had stated to each other,- that all their contracts respectively, were made subject to and in reference to the usage, giving either party the right to call for a margin on the contract as. stated.”
All the qualities of a special usage are here proposed to be proved. Knowledge, certainty, reciprocity, and uniformity with express application to the contract sued upon; for it does not appear that the conversation referred to, might not have been subsequent to the date of the contract.
It is objected, that it was not proposed to prove, that the usage included a right to rescind the contract, upon non-compliance with its terms. This right is a legal consequence of non-compliance, an inference of law. If the terms or conditions of the usage had been incorporated into the contract, it would have been the province and duty of the Court to instruct the jury, as to the legal effect of the refusal of either party to comply with its conditions. The object of such conditions could only be indemnity or protection from failure to comply. It was preventive; to be construed so as to give equal and full protection to each. *523To effect this entirely, the right to rescind was essential; otherwise the consequences of failure might be irretrievable. No amount of damages, against an insolvent contractor, would save harmless the other party. One,' who upon being required to give reasonable security for the performance of his contract, would refuse to comply, having stipulated to do so, might reasonably be expected to refuse to perforin the contract at its maturity. This usage redeemed the contracts on time from the odium of mere gambling transactions,- — which have unfortunately become so frequent,- — and gave a bona files to operations which would otherwise he deemed unworthy of commercial integrity. Whether regarded as evidence tending to bar the right of action on the contract, or reduce the amount oí damages, we think the testimony offered to prove a special usage between the appellant and the supposed agent, Bell, should have been admitted. This aspect of the case, reconciles it with the decision in 23 Howard.
The defendants in 23 How., 62, did not offer to prove a partial or special usage, hut a general usage or custom of trade in the city of Baltimore. The opinion of the Court was, “that the defendants wholly failed to prove any general or established usage or custom of the trade in Baltimore, as claimed in the defence.” .Every witness called on their behalf fails to prove facts essential to make out the custom in the sense of the law; on the contrary, most of them expressly disprove it.
The distinction recognised and adopted by this Court in the case of the Merchants Mutual Ins. Co., vs. Wilson, was not adverted to; the facts of the ease perhaps did not require it, yet however profound our respect for tire high tribunal which decided the questions in 23 How., if that decision conflicted with that of this Court, on questions of commmercial law merely, we should be bound to adhere to the latter.
The instruction granted by the Court, at the instance of the plaintiff, the appellee, which is the ground of the ap*524pellants’ fourth exception, positively excludes from the consideration of tbe jury, tbe consideration of tbe facts offered to be “proved by the defendant, and rejected by tbe Court, and which have been the' subjects of the second and third exceptions. It allows no consideration of the effect of giving exclusive credit to tbe agent, by tbe defendants, or of the special usage offered to be proved by the appellants, and is therefore at variance with tbe principles and authorities before cited in commenting upon those exceptions, and, as such, in my opinion was erroneous.
(Decided June 1st, 1864.)

Judgment affirmed.