Court Opinion

ID: 3239575
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:13:16.744598+00
Date Added: 2024-06-11T13:59:00.263120
License: Public Domain

The verdict eliminated count 5. The verdict and judgment rested on count 3. Whatever be the effect of pleading in short by consent, a jury question was presented. Alley v. Jesse French Piano  Organ Co., 148 Ala. 303, 42 So. 623; Alabama Clay Products Co. v. Mathews, 220 Ala. 552, 126 So. 869; Page v. Skinner, 220 Ala. 302, 125 So. 36; Moore v. Williamson,210 Ala. 427, 98 So. 201; Allen v. Standard Ins. Co., 198 Ala. 525,73 So. 897.
It should be stated that plaintiff was the contractor proposing to erect the church in Nashville; that the Ryan Sales Company was the agent of defendant and offered to supply appellee-plaintiff with the required and specified steel trusses for the proposed building at the designated price, on which appellee relied and acted in making its successful bid for that structure; that there was refusal to supply the steel trusses at the price indicated, and appellee went into the market and purchased said material at advanced market price in excess of the offer exhibited in count 3; hence the suit to recover that difference and loss.
Plaintiff's evidence was to the effect that on May 8, 1928, it received an offer from defendant's agent, among other things, as follows: "Ingalls Steel Joist: We propose to furnish Ingalls Bar Joist and Accessories complete with top lath and 1/4" reinforcing steel in accordance with the plans and specifications for the net sum of Twenty Seven Hundred and Seventy Eight Dollars ($2,778.00), freight allowed to Nashville"; that, after it received that offer and bid for said structural steel as exhibited in count 3, and acted thereon, it accepted the offer of date of May 12, 1928, as "Buyer", and that thereafter appellee received the following:
"The Ingalls Steel Products Company
  "Manufacturers of 'The Ingalls Truss' for Fireproof Floors and Roofs — Patents Pending
"Works and Executive Offices, Birmingham, Ala.
                            "Birmingham, Ala. "May 15, 1928.
"Foster  Creighton Co., Nashville, Tenn.
"Gentlemen: Re: Central Church of Christ. Attached is formal acknowledgment of your order given to Ryan Sales Company for the above mentioned job.
"As soon as we receive architectural plans we will make us shop drawings and forward for approval. Shipment can be made rather promptly after approval of shop drawings.
"Yours very truly,
"The Ingalls Steel Products Company
"By [Signed] Thomas A. Lucy
"TAL/WHL                             Chief Engineer."
Attached to Plaintiff's Exhibit 4 and introduced therewith was a paper, which was in words and figures as follows, to-wit:
              "The Ingalls Steel Products Co. "Birmingham, Ala.
"Acknowledgment of Order.
"Date 5-14-28
"Charge to Foster 
Creighton Company     Sales Order J-126 "Address Nashville, Tenn.                 Sheet 1 of 1 "Ship to Same           Customer's Order No. 5-11-28
"At Nashville, Tenn.    F. O. B. Birmingham, Ala. F/A to Nashville, Tenn. Terms Net 30 days
"Via Freight — Collect "Delivery 2 weeks after approval.
Quantity Unit  Description   Piece   Weight   Price   Per Total
"Ingalls Trusses, Anchors, Bridging, 1/4" Temp Bars and Steeltex in accordance with drawings by Jones  Oehmig, omitting materials over Coal Room and Entry
"Price ......... $2,951.00
"F. O. B. B'Ham, Ala. F/A to Nashville, Tenn.
__________________________________________________________
"Please Note — This is an acknowledgment of your order as we understand it and we will ship accordingly. Please check carefully and report any differences immediately.
"Your very truly,
        "The Ingalls Steel Products Co. "(Printed)."
Plaintiff offered in evidence letter of refusal from "the Ingalls Steel Products Company to Foster Creighton Company, Nashville, Tennessee, dated May 21st, 1928, which said letter was duly admitted in evidence, and is marked 'Plaintiff's Exhibit 5,' and is in words and figures as follows:
"Plaintiff's Exhibit 5.
"The Ingalls Steel Products Company
"Manufacturers of 'The Ingalls Truss,' for Fireproof Floors and Roofs — Patents Pending
"Works and Executive Offices, Birmingham, Ala.
                               "Birmingham, Ala. "May 21st, 1928.
"Foster Creighton Company, Nashville, Tenn.
"Gentlemen: Central Church of Christ. We have withheld formal acceptance of your contract as covered by our proposal of May 11th, until plans were received and check made oh the quantities involved.
"As you know, we were unable to secure any plans and particularly from your office. Mr. Holt, of the Ryan Sales Company, sent *Page 128 
us some freehand sketches of the floor plans and we based our proposal on these sketches. These sketches showed no fifth floor, but only a roof section 26' -8" x 29' 4". Upon checking the plans which you sent us, we find that a fifth floor will be required of an area equal to that of the fourth floor.
"This additional story will add $747.00 to our previous quotation. Upon receipt of your authority to add this to our proposal, we will change the proposal, to cover the job as shown by the Architect's Prints we now have and have contract approved by an officer of the Company and prepare to ship the materials.
"Your very truly
      "Ingalls Steel Products Company "By [Signed] Thomas A. Lucy."
Thereupon witness (plaintiff) testified further as follows: "I did make reply to his letter of May 21st, which was introduced. I did not agree in my reply to the request of Ingalls Steel Products Company for authority to add $747.00 to the proposal. I got the steel that I was trying to buy from Ingalls Steel Products Company from another party afterwards and I built the building."
Count 3 was sufficient as against the arrest of judgment, and stated a substantial cause of action without the matter which was admitted and fully informed defendant of what it was charged. There was no reversible error in overruling demurrers to said count. The court instructed the jury as to the material issues to be found; and the evidence was sufficient to prove required allegations of facts: That plaintiff agreed to pay said sum indicated for said steel; that the proposal was approved in writing by an officer of defendant; that defendant contracted to furnish said steel for said price and entered into a valid contract for the same from defendant. Best Park 
Amusement Co. v. Rollins, 192 Ala. 534, 68 So. 417, Ann. Cas. 1917D, 929; Jackson v. Vaughn, 204 Ala. 543, 86 So. 469; City of Mobile v. McClure, 221 Ala. 51, 127 So. 832.
The contract here exhibited is different in specific terms required of an acceptance from that in Sturdivant v. Mt. Dixie S., L.  I. Co., 197 Ala. 280, 72 So. 502; Gould v. Cates Chair Co., 147 Ala. 629, 41 So. 675, where the order was taken by a traveling salesman authorized to make contracts of sale subject to approval (Simon  Son v. Johnson, 101 Ala. 368, 371,13 So. 491), and from that in Manier  Co. v. Appling, 112 Ala. 663,20 So. 978, 979, where the acknowledgment of receipt of order was: "The same shall have prompt attention," and therefore was not final, binding and unconditional. Paterson  Edey Lumber Co. v. Carolina-Portland Cement Co., 215 Ala. 621, 625,112 So. 245, was where both parties had mutually agreed the contract was not to be binding until signed by both of them. In the case before us, the proposal of the seller would be binding on acceptance by the seller and approval by the buyer in its name by Lucy, its chief engineer.
We are impressed with the construction urged by appellee of the provision in the letter of date of May 15, 1928. The fetter reads:
"Gentlemen: Attached is formal acknowledgment of your order given to Ryan Sales Company for the above mentioned job.
"As soon as we receive architectural plans we will make up shop drawings and forward for approval. Shipment can be made rather promptly after approval of shop drawings.
"Yours very truly,
    "The Ingalls Steel Products Company, "By Thomas A. Lucy [Signed] "Chief Engineer."
It was within the issue for the jury that at the time this letter was written the appellant regarded itself as having the contract as subcontractor for steel trusses, and was merely referring by such words to the performance of the contract and shipment after approval of "shop drawings," which was not a condition to the making of the contract, but referred to the manner and time of performance by the sentence employed.
Thus we come to the main insistence of the parties, that the contract was not binding upon defendant because it was not approved in writing by an officer of the defendant with authority to such action. The implied powers of a general executive officer or its general manager are usually coextensive with the general scope of that business. Navco Hardwood Co. v. Bass, 214 Ala. 553, 557, 108 So. 452; First Nat. Bank of Birmingham v. First Nat. Bank of Newport, 116 Ala. 520,22 So. 976; Montgomery B.  T. Co. v. Walker, 181 Ala. 368,61 So. 951; 14a C. J. pp. 94, 95, § 1862. The capacity or authority of an officer to execute a contract in behalf of an ordinary business corporation, in an action upon a contract executed or purported to be executed in its name, is defensive matter, and should be presented by special pleas, unless the lack of authority or power is affirmatively shown by the pleading or such as that the court takes judicial knowledge thereof. Perryman  Co. v. Farmers' Union Ginning  Mfg. Co.,167 Ala. 414, 52 So. 644.
The holding that a superintending engineer is not a general engineer (Alexander v. Ala. Western R. R. Co., 179 Ala. 480,60 So. 295), is not decisive here.
The correspondence is set out, and its effect is that appellee relied on the letter written and signed by "Thomas A. Lucy, Chief Engineer," as the foundation of its action, that it purports to be signed by the defendant (appellant) through and by its acting agent in that behalf, Thomas A. Lucy.
I am of opinion count 3 states a cause of action, and the evidence well supported the verdict rendered thereon. *Page 129 
Is the case within the exception announced in Perryman  Co. v. Farmers' Union Ginning  Mfg. Co., 167 Ala. 414, 420,52 So. 644, 646, that the authority or capacity of an officer of a corporation to contract or execute a contract in its behalf, in an action upon a contract purporting to be executed in the corporate name, by such officer, "is defensive matter, and mustbe raised by special plea, unless [1] the lack of such authority or power is affirmatively shown on the face of the" pleading, or (2) unless it be matter of judicial knowledge that such officer has no such capacity or authority to bind the corporation, and (3) that the want of authority of an officer to bind the corporation is defensive matter which must be alleged and proved? (Italics supplied.)
And in Coston-Riles Lumber Co. v. Alabama Machinery  Supply Co., 209 Ala. 151, 95 So. 577, 578, is the holding that generally "every grant of power implies and carries with it, as an incident, authority to do whatever acts, or use whatever means are reasonably necessary and proper to the accomplishment of the purpose for which the agency was created"; and in that case the authority to execute a promissory note to secure an existing indebtedness implied the power to make a valid obligation.
In Paterson  Edey Lumber Co. v. Carolina-Portland Cement Co., 215 Ala. 621, 625, 112 So. 245, 249, it was agreed that the written contract should be effective if and only when it "was approved by an executive officer" of that company. Such is not the effect of the instant written proposal exhibited by count 3. It is:
"Terms:
"This proposal when accepted by the Buyer and approved in writing by an officer of the Seller at Birmingham, Alabama, becomes a contract in full force and binding on both parties. Shipment two weeks after approval of shop drawings.
"Accepted Foster             Ingalls Steel Products Creighton Co.                Company,
Ryan Sales Company.
"By N. F. Creighton, Pres.
"Title __________             By E. F. Holt
Approved at Birmingham, "Date May 12, 1928.              Alabama
By __________
Title __________
"90# Live load 1st floor
"60# Live load upper floors and main roof."
It is averred that plaintiff accepted the proposal to sell the trusses, anchors, and bridging, by its indorsement on the writing, which was an acknowledgment of the order, and that same was to be "shipped accordingly;" and confirmation of that proposal and acceptance was in the name of the defendant company, by "Thomas A. Lucy, Chief Engineer." This did not bring the case within the exceptions indicated in Perryman 
Co. v. Farmers' Union Ginning  Mfg. Co., supra, and did not take the pleading without the rule of section 7663, Code of 1928.
KNIGHT, J., concurs in the foregoing dissent.