
    No. 624
    UNIVERSAL COAL CO. v. SCHIER MOTOR CAR CO.
    Cincinnati Superior Court
    No. 59109.
    Decided June 17, 1925
    557. FRAUD—As between two innocent parties, one who enables it to be committed, or a loss to occur, must suffer the consequences.
    Attorneys—W. F. Fox for Coal Co.; Broad-well and Cawguill for Motor Car Co; all of Cincinnati.
   MARX, J.

W. J. Richardson was a sales agent and officer in the Universal Coal Co. On Sept. 11, 1923, he purchased a machine for $1800 and in part payment thereof traded in a used car, its value being $575, so that a balance of $1225 remained. In order to pay this, Richardson asked the Motor Car Co. to draw a sight draft on the Coal Co. for $1350 and upon payment thereof to give him the excess over and above the balance ($125) in cash.

The draft was drawn but was not paid promptly, and Richardson in order to obtain use of the car gave his personal check to the Car Co. for $1225. The car was delivered to Richardson and the draft drawn on the Coal Co. was paid in full, Sept. 19„ 1923, and the $1350 for which it called was paid to Richardson by the Motor Car Co. at his request.

Suit was brought by the Coal Co. against the Motor Car Co. and it was admitted that Richardson purchased the car to use in the business of the Coal Co. It was sought however to recover the difference between the purchase price and the amount of the draft, namely $125. The Court held:

1. As between the parties it would appear that Richardson had a sufficient sum standing to his credit or authority to draw upon the Coal Co. for the sum in question because the draft was accepted and paid by it.

2. There is no evidence that the Motor Car Co. acted in connivance with Richardson, or knowingly assisted him in defrauding his own Company; or it may be that Richardson overdrew his account so that the Motor Car Co. cannot be charged.

3. Assuming the Coal Co. and the Motor Car Co. to be alike innocent in this case, it was the Coal Co. who clothed its officer and agent with apparent authority to enable what occurred to take place and hence the Coal Co. must bear the loss.  