Remmel v. Townsend — 64 N.Y. St. Rep. 845

Majority

p. 845

Fred T. Remmel, Resp’t, v. Martha L. Townsend, App’lt.

(Supreme Court, General Term, Fifth Department,

Filed December 27, 1894.)

Headnote

Election op remedies—Undisclosed principal.

The recovery of a judgment against the purchaser for the price of goods, in ignorance that he was the agent of another person in the transaction, does not estop the seller from suing such principal.

Appeal from a judgment, affirming a judgment of the municipal court of the city of Eochester.

F. A. Mann, for app’lt; H. B. Hallock, for resp’t.

It is a well-settled rule of law that if a creditor,

p. 846

after the discovery of the principal, elect to hold the. agent who purchased goods without disclosing his agency, he is bound by the election, and cannot pursue the principal. It is the contention of the appellant that the same rule applies if the creditor prosecutes the agent to judgment, in ignorance that he purchased as an agent, upon the theory that, he having once elected to sue the agent, he is estopped from pursuing the principal. It is difficult to see upon what theory a creditor can be said to have made an election in such a case when he was not aware that there was an opportunity for him to make a choice. In the case at bar the plaintiff supposed, when he brought the action against the husband, that his claim was against him only. There was, so far as he then knew, but one thing for him to do, and that was to bring his action against the person who he then supposed and understood purchased the goods as principal. Had he known the true situation, he would then have been in a position to have made a choice. The act' of electing between two remedies presupposes knowledge on the part of the one performing the act that he has an opportunity of choosing between two or more courses to pursue. If he understands there is but one thing for him to obtain, or but one course that he can take, he cannot be said to have made a choice. The like rule regarding the selection of remedies obtains where the vendor has been induced to part with his property by the fraud of the vendee. He is, in such a case, at liberty to waive the fraud, and affirm the contract, and sue for the value of the goods sold, or replevy the goods. If, with full knowledge of all the facts, he pursues the first course, he is thereafter estopped from disaffirming the contract and pursuing the goods. If the prosecution of an action for the value of the goods to judgment in such a case in ignorance of the fraud does not estop the creditor from maintaining an action to recover the possession of the goods upon discovery of the fraud, there is no reason apparent why he should be estopped, under the circumstances of this case.

In the case of Rochester Distilling Co. v. Devendorf, 72 Hun, 428 ; 54 St. Rep. 864 , the plaintiff had sold a bill of goods to the defendant’s "husband. An action was brought against the husband, and a judgment recovered for the purchase price of the goods. Hpon examination in proceedings supplementary to execution, the plaintiff learned for the first time that the goods were fraudulently purchased by Devendorf, and that Devendorf had, after purchasing the goods, transferred them to his wife, the defendant in this action, without any consideration being paid there-fer, and thereupon he commenced an action in replevin for the goods, making the wife the defendant. The judgment against the husband was pleaded in bar of the action. We held that the creditor was at liberty, notwithstanding the judgment, to prosecute the action for the recovery of the property, for the reason that he prosecuted the former action in ignorance of the fraud. If the judgment there was not a bar, why should it be in this case ? A distinction is sought to be made between the two cases by the appellant’s counsel. He suggests that a claim arising upon a contract for the purchase price of goods sold and one arising out

p. 847

of fraud in the purchase of goods are of a very different nature, while that" is so, it does not occur to us that it has any bearing upon the question' here. If the vendor, with knowledge of the fraudulent sale of goods, elects to waive the fraud and affirm the sale, and brings an action for the purchase price of the goods, the judgment would be a bar to an action to recover possession of the property. He cannot, thereafter, elect to disaffirm the sale. It is an election he made with knowledge of the facts, which estops him, and so if, after the sale of goods to an agent for an undisclosed principal, the creditor, with knowledge of the facts, elects to proceed against the agent, he is bound by his election. It is the election with knowledge of the facts that estops him in both cases.

The appellant relies upon the case of Priestly v. Fernie, 3 Hurl. & C. 977. There an action had been prosecuted to judgment against a master of a vessel for supplies, and thereafter an action was brought against the owner for the same account. It was held by Bramwell, B., that the former judgment was a bar to the action. The action in that case was against the defendant, as master of the vessel acting for its owner. It does not appear from the opinion whether, at the time of furnishing the supplies, the creditor was informed as to who owned the vessel; but, the supplies having been purchased by the master as such, the presumption was that he was acting for an owner, and not as the owner.

There will be found in the text-books and .in the opinions of the courts statements which would seem to sustain the appellant’s contention ; but we think, upon examination, it will be found that the current of authority in this country and in England is not in conflict with our conclusions. In most of the cases to which our attention is called the election to sue was made with full knowledge of the facts; in other cases it does not appear whether the election was made or not in ignorance of all the facts. The judgment appealed from should be affirmed, with costs. All concur.