Carter v. Reardon-Smith Line, Ltd.

Offutt, J., delivered the opinion of the Court. The Reardon-Smith Line, Ltd., a corporation under the laws of Great Britain, has for a number of years been engaged in the business of transporting freight for hire on ocean going vessels from ports on the Atlantic seaboard of the United States to* ports in other countries. Its freight service appears to have been divided into two classes, one a “berth” or “general cargo” business, and the other a “tramp” or “full cargo service.” In the general cargo business, a certain regularity and uniformity as to the time and place of service is maintained, while in the “full cargo” or “tramp” service there is no* such uniformity or regularity, but the vessels are chartered under a single charter party, and whether they arrive at or depart from a given port depends upon no regular schedule or sailing list, but upon the needs and convenience o*f the charterer. In connection with its business as an ocean carrier, the Reardon-Smith Line, Ltd., hereinafter referred to* a*s the Reardon-Slmith Line, owned and operated a number of freight carrying ship*s, some of which were allocated to* the general cargo* business and others to the full cargo or “tramp” service.

In the course of its general cargo* business, it attempted to* estab ⁵⁴⁹ lisli freight carrying lines between different ports in the T niited States and ports in Great Britain mid Germany, carrying accumulated cargoes and operating on a definite schedule, and in connection with that general purpose, on or about December, 1922, it established an ocean carrying freight line between Baltimore and London, Liverpool, and Hamburg. It was, as we have said, a British corporation, and it transacted its business in this country by agents, who appear to have been W. G. Liley of New York, its resident director and American representative, and the United States Navigation Company. When the line from Baltimore was established, the United States Navigation Company, hereinafter called the Navigation Company, claiming to be the general agent of the Rear-don-Smith Line for its general cargo or berth service in this country, entered into a contract with Maurice B. Carlin, a ship broker of Baltimore, whereby Carlin was appointed tbe agent of the Beardon-Smith Line for its Baltimore general cargo service from December 11th, 1922, to January 1st, 1924, and at the same time he was selected by Mr. Liley as the agent for such of the company’s “full cargo” steamers as came to Baltimore. The “general cargo” or berth service from Baltimore was discontinued in 1923, and Carlin’s employment as the company’s agent at Baltimore for matters connected with that service was, the company contends, cancelled as of December 31st, 1923.

On or about March 22nd, 1923, while the relation of principal and agent still existed between Carlin and the company, Edward M. Langley & Company, Cincinnati, Ohio-, shipped one hundred and fifty -barrels of rye whiskey on a “uniform through bill of lading over the lines of the Bear-don-Smith Line, and the Baltimore & Ohio- Railroad Company from lynchburg, Ohio, to Cecil William Plumb at London. Several co-partners, trading as “'Carters:,” bankers of London, financed the purchase, and as security took an assignment of the bill of lading. The shipment was deliv ⁵⁵⁰ ered to the City of Quebec, one of the Reardon-Smith Line’s vessels, by the Canton Railroad Company, a connecting carrier, and ultimately delivered in London, where it was found to be thirty-five barrels short. “Carters” thereupon demanded that the carriers make good that shortage, and upon their refusal this suit was instituted against the two- railroad companies and the ReardomSmith .Line. The action was begun -on January 24tli, 1924, and on March 20th, 1924, the' Reardon-Smith Line was summoned by service on Maurice B. Carlin, a's its agent.

The ReardonSmith Line- moved to- quash the writ of summons on the ground that when it was served Carlin was no longer its agent, and the court, after hearing testimony upon that question, sustained- the motion and quashed the writ, and from that order this appeal was taken. The record -contains eight exception's, of which seven relate to rulings on questions of evidence and one to the- order quashing the writ of summons. The first exception deals with the action -of the court in admitting in evidence the contract between Carlin and the United States Navigation Company, under which Carlin was employed as the appellee’s- agent, and the second to its action in allowing the appellee to offer in evidence- a letter dated November 26th? 1923, cancelling that employment as of December 31st, 1923. John W. Pracsent, secretary of the United -States Navigation Company, was asked what were the relation's between that company and the Reardon-Smith Line and he answered that it was the- general agent of that company to represent general cargo boats, and the appellants objected to that question and answer*.

The court then asked “How were you appointed?” and the witness replied, “By correspondence; and our vice-president went over to- Cardiff, Wales, and made the connection.” Objection was also made to- this question and answer, which was -overruled, and the witness answered: “We only represented the Reardon-Smith steamers accumulating cargoes- for certain po-rts like Hamburg and Liverpool where we had regular -service- according ⁵⁵¹ to our schedule, not on full cargoes.” The appellants then excepted to the “ruling of the court in permitting the witness to answer said question,” and that is the third exception. If the United States Navigation Company was the general agent of the Reardon-Smith Line, them in view of all the testimony in the ease there was no. reversible error in admitting the contract of agency and the cancellation thereof, because later in the case the signatures of the officers of the Navigation Company to that contract and the letter of cancellation were regularly proved, and the whole question turns therefore on whether the evidence did show that the Navigation Company was authorized to employ Carlin as the agent of the Reardon-Smith Line. The witness, in giving the testimony involved in the third exception was obviously not attempting to construe the correspondence to which he referred, hut was describing a status which resulted from the course of business between the ReardonSmith Line and the Navigation Company, and while the witness should not have been permitted to state the legal effect of documents not proved in the ease1, his statement could not have injured the appellants., in view of the fact that there was in the case evidence sufficient to have warranted the court in concluding that the Navigation Company was authorized on behalf of the Reardon-Smith Line to employ Carlin as the latter’s agent. It is uneontradicted that before that contract Carlin met W. GT.

Liley, resident director in the United States of the Reardon-Smith Line, and' its American representative, at his office in New York at the request of Mr. Oelsner, president of the Navigation Company, and at that interview, at which Mr. Oelsner was present, he, Liley, approved the arrangement of establishing a line in Baltimore, and that thenceforth Liley considered Carlin & Company as his Baltimore agents; that after the contract Sir William Reardon Smith, chairman of the board of directors of Sir William Reardon Smith & Sons, and Liley, visited Carlin in Baltimore and told him that he, Smith, was ⁵⁵² “quite pleased” -with the way things were going; that the Ravigation Company advertised itself in the trade journals as the general agents of the Reardon-Smith Lines; that it represented that company in accumulating cargo at certain ports where that company operated a regular schedule; and that for about a year Oarlin acted as 'agent in Baltimore for the Reardon-Smith Company’s “berth” or “full cargo” business, and that the only authority he had to act as such agent was derived from the contract with the Ravigation Company. This evidence was, we think, sufficient to warrant the inference that the Ravigation Company was authorized to employ Carlin and to make a contract of agency with him, and also to cancel it, and we find therefore no- reversible error in the rulings involved in the first three exceptions. The fourth exception relates to the action of the court in permitting the appellee to prove that the Baltimore venture turned out unprofitably. That evidence reflected upon the good faith of the appellee in terminating the agency, and was in our opinion properly admitted.

The court, over appellants’ objection, permitted the appellee to offer in evidence clippings of advertisements of sailings of the appellee’s ships engaged in the general cargo business from issues of the Rew York Commercial and the Journal of Commerce of August 9th and August 11th, 1923, and a sailing list, in all of which the Ravigation Company described itself as the “General Agents” of the ReardonSmith Line, and those rulings are the subject of the fifth exception. This evidence tended to prove that the appellee permitted the Ravigation Company to hold itself out as its agent. For while it doe's not appear directly that it saw the advertisements or the sailing list, it may reasonably be inferred that it did, when the nature of its business, and the fact that its American representative was directing the business of the company in the very city where these papers were circulated among persons interested in that trade, are considered, and we find ím error in this ruling. In the course of the examination of Carlin, he was asked ⁵⁵³ this question: “In connection with the city directory and the telephone book and the window sign and the door sign, would it not be proper to say that the cause for their existence beyond the cancellation of that contract of December 11th was either inadvertence- on your part or unwillingness to go to the expense of making the 'correction, but that you did not understand that you had any authority ?” To- which the appellants objected.

The objection was overruled and that ruling is the subject of the sixth exception. The form of the question is undoubtedly bad, but as no objection appears to have been made to it on that ground in the trial court, we cannot consider that objection here. But it was also- objectionable because it had no possible relevancy to any issue in the case, since Carlin’s motives, whatever they may have been, could hardly have affected the rights of third persons to whom they had never been communicated, but in the view we take of this case the appellant was not injured by the error. At the close of the appellee’s testimony the appellants offered to prove by competent evidence the circumstances under which the whiskey was bought and shipped, and the purchase financed, but the offer was overruled, and that ruling is the subject of the seventh exception.

We find no error in that ruling. The only issue before the court was whether the appellee was bound by service of the writ of summons on Carlin as its agent, and the evidence referred to- in this exception was neither relevant nor material to that issue. The eighth exception relates to- the court’s action in quashing the writ of summons and presents a mixed question of law and fact. That ruling necessarily assumed that the evidence adduced in support of the motion was sufficient to establish the fact that when the writ was served Carlin was not the' agent or the servant of the appellee within the meaning of the statutes relating to- the service of process upon foreign corporations, and a consideration of it requires us to refer in some detail to the evidence, bearing upon that issue. ⁵⁵⁴ Maurice B. -Carlin testified that the- agency contract bctween him and the Navigation Company was executed on December the 11th, 1922; that on November 26th, 1923, he received a letter from that company cancelling the contract, the cancellation to take effect December 31st, 1923, and offering to renew the contract on the same terms exee-p-t that the new contract would be-between Carlin and the Navigation Company -as principal; that he wrote that company on November 28th expressing his willingness to renew the contract with it as principal but that in fact it never was renewed, and that after it was cancelled he had no further relations with the appellee; that the last ship of the ReardonSmith Company which was subject to the- -agency contract with the Navigation