Fisher Scientific Co. v. McCorkle
295 S.E.2d 366, 163 Ga. App. 613, 1982 Ga. App. LEXIS 2596 (1982)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
An agent who enters into a contract on behalf of an undisclosed principal is personally liable on that contract. The third party dealing with the agent may elect to sue either the agent or, upon discovery, the undisclosed principal.
Facts:
- Chip McCorkle was an employee of Jones & Armstrong Steel Company.
- Fisher Scientific Company's policy was to sell chemicals and laboratory supplies only to companies, not to individuals.
- Desiring to obtain supplies for his friend, Mills, McCorkle contacted Fisher Scientific.
- McCorkle placed orders for the supplies in the name of his employer, Jones & Armstrong Steel Company, and used its credit.
- After the supplies were delivered to Jones & Armstrong's place of business, McCorkle would notify Mills, who would then retrieve them.
- McCorkle claimed that Jones & Armstrong management had given him permission to make these purchases using the company's name and credit.
Procedural Posture:
- Fisher Scientific Company sued Chip McCorkle in a trial court to recover the amount owed for supplies.
- The case was tried before a jury, which returned a verdict in favor of McCorkle.
- The trial court denied Fisher Scientific’s motion for a directed verdict.
- Following the verdict, the trial court denied Fisher Scientific's motion for a judgment notwithstanding the verdict (JNOV).
- Fisher Scientific, as appellant, appealed the denial of its motions to the Georgia Court of Appeals.
- McCorkle, as appellee, filed a cross-appeal regarding the use of his deposition at trial.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Is an agent who makes a contract for an undisclosed principal personally liable to the third party on that contract, even if the agent used the name and credit of their employer with the employer's permission?
Opinions:
Majority - Birdsong, J.
Yes. An agent who contracts on behalf of an undisclosed principal is personally liable to the third party. The court accepted for purposes of appeal the jury's finding that McCorkle's employer, Jones & Armstrong, had authorized him to use its name and credit. However, the true undisclosed principal in the transaction was McCorkle's friend, Mills. As between Fisher Scientific and McCorkle, McCorkle acted as the agent for Mills. Under Georgia law (Code Ann. § 4-305), when a principal is undisclosed, the third party may elect to hold either the agent (McCorkle) or the principal (Mills) liable. Because Fisher Scientific elected to sue the agent, McCorkle is personally liable regardless of any permission he may have had from his employer.
Analysis:
This case provides a straightforward application of a fundamental principle of agency law regarding undisclosed principals. It clarifies that an agent's liability is not negated by a complex arrangement involving a third party whose credit is used for the transaction. The court focused on the direct relationship between the contracting party (Fisher) and the agent (McCorkle), establishing that the agent cannot use the authority of one entity (their employer) as a shield from liability when they are actually acting for a different, undisclosed principal (their friend). This decision reinforces the protection afforded to third parties who are unaware of the true party in interest, giving them a clear right of action against the person with whom they directly dealt.
