Story Case

Henry Drew asked George Fowler to buy a Buick automobile for him when he made his trip into the city, explaining also the type of car he desired. Fowler replied he would buy the car. Thereupon, when in the city, Fowler purchased a car, taking it in the name of Drew, who was a wealthy farmer with considerable credit in that community. Drew later refused to take the car, on the ground that no contract existed between himself and Fowler; that a mere request does not complete an agency, and therefore the latter had no authority to make the purchase. Is this defense good?

Ruling Court Case. Schneider Vs. Schneider, Volume 98 Of The Northwestern Reports, Page 159

One Casper Schneider died leaving considerable property in the state of Iowa. His next of kin and heirs at law were: A widow, confined in an insane asylum, and a sister, who lived in Germany and who had never been in America.

One Wessling was appointed administrator. He at once communicated the circumstances to the sister in Germany. She immediately began to make plans to get a lawyer in this country to settle up her affairs. Wessling wrote back and told her all American lawyers were a set of knaves and would charge her an exhorbi-tant price for their services and that he could do it much more cheaply. She said nothing but acquiesced in his plans.

He falsely informed her that it would be many years before she could get any benefit from her brother's estate, and that, out of consideration for her, he was willing to pay her $1,000 for her interest if she wished to sell. She consented and made out the conveyance. As a matter of fact, her interest was probably worth twice as much as she received. She afterward filed a bill to have the conveyance set aside and a partition of the property declared.

The Court held that she was entitled to have the relief asked for. It was said that Wessling became an agent by his very conduct with her and her assent to his proceedings with the property. It is a fundamental rule that when an agent purchases from his principal he is held to the highest faith and strictest accountability. Wessling here was an agent by conduct and he did not act in good faith. The conveyance made by Wessling was set aside and a partition of the property declared.

Ruling Law. Story Case Answer

As a general rule no particular form is necessary in appointing an agent. The principal may give authority in writing, or he may give it by word of mouth. In some cases the agency relation is implied from the circumstances without writing, word of mouth or contract conferring the power.

In the Story Case, sufficient negotiations passed between Drew and Fowler to enable Fowler to act as agent. It was not necessary that all the terms of their understanding be expressly stipulated between them. It was only necessary that Drew authorize Fowler to act. Drew is liable on the contract made by Fowler in purchasing the machine.