Reply: This is simply the case of an individual who has purchased goods and then has sold or transferred them before they have come into his actual possession. Such cases, that is, of a second sale before delivery to the first purchaser, are very common, and the original purchaser remains liable precisely as if delivery has been made to him and he had afterward disposed of the goods as he saw fit. In the case our correspondent puts the seller may look to the first buyer unless he has agreed to release him and look to the firm.
Opinion No. 38.
A LUMBER SALESMAN GENERALLY HAS NO POWER TO BIND HIS PRINCIPAL.
Question—One of our traveling salesmen has just sent in a larger order than we feel safe in filling for that particular customer on the liberal terms of credit allowed him in the same contract. Are we compelled to fill the order, or may we reject it without incurring any legal liability?
Reply: Ordinarily a traveling salesman is authorized merely to take orders and submit them to his principal for acceptance or rejection. He has no power to bind his employer irrevocably by a contract of sale. Our correspondents are justified in refusing to fill an order sent in by their salesman unless the latter was expressly authorized to make a valid and binding sale upon his employers’ behalf, or unless traveling salesmen are usually clothed with this power. In the latter case each salesman will be presumed to have the powers usually possessed by men of this class, unless the buyer had notice of a limitation upon this general and usual power in the case of the salesman with whom he was dealing.
Opinion No. 35.
USING LUMBER WITHOUT CONSENT OF SHIPPER WHERE QUALITY IS DISPUTED.
Question—We shipped a carload of lumber to a party and they complained of the quality and refused to settle in full. We insisted upon a settlement in accordance with invoice, or re-inspection of the entire carload by an inspector that would be satisfactory to both parties. We sent a man to look at the lumber and found that it was put in a dry kiln without our consent, and this, of course, prevented an inspection of the lumber in its original condition. Are we correct now in insisting upon a settlement in full as invoiced, and can we maintain our action in a lawsuit?
Reply: If your lumber was received by the company and, without authorization from you they put it in the dry kiln, so as to prevent your examining it or taking it back, they would be liable to you for the invoice price. They cannot accept the lumber, use it and then refuse to pay. By their acceptance they waive any defects in quality or quantity, which can be ascertained upon an inspection of the lumber upon arrival. They do not waive any defects that are what we call “latent,” that is, that are not readily ascertainable upon an examination of the lumber on arrival, but only show after the lumber may be put in use. As we take it, such complaints as have been made relate to alleged defects which they ascertained as soon as they received the lumber. In that case they had no legal right to use it, and if they used it, they are liable for the invoice price.
Opinion No. 34.