APPEAL from the Circuit Court of Winnebago County; the Hon.
JOHN S. GHENT, Judge, presiding.
MR. JUSTICE GUILD DELIVERED THE OPINION OF THE COURT:
Rehearing denied June 27, 1977.
The defendant, Tony Greve, employed by Raymond L. Watkins d/b/a Beltone Hearing Aid Center, entered into a lease agreement with Lou Bachrodt Chevrolet, Inc., for two automobiles. Greve subsequently left the employment of Beltone and took the motor vehicles with him from Rockford to Kankakee. The lessor of the vehicles, Lou Bachrodt Chevrolet, Inc., filed suit against both Greve and Watkins, d/b/a Beltone Hearing Aid Center (hereinafter Beltone). In a bench trial the trial court entered judgment against the defendant Tony Greve and in favor of Beltone. On appeal by Bachrodt we reverse as to the finding of the trial court in favor of Beltone.
The basic question presented in this case is the apparent or implied authority of Greve, the employee of Beltone.
The defendant Greve, a nephew of Mrs. Watkins, the wife of the defendant Raymond L. Watkins, was employed in the Rockford office of Beltone. The employees or salesmen of Beltone were referred to as "consultants." On October 13, 1971, Greve telephoned Lou Bachrodt Chevrolet and advised a Mr. Jefferies, who was the fleet and leasing manager of Bachrodt, that he wished to lease a car. He advised Jefferies that he was the manager of Beltone and later that day he personally contacted Mr. Jefferies relative to the leasing of the motor vehicle. According to the testimony of Jefferies, Greve was given an "Assumption of Liability Agreement" form with the words "Beltone Hearing Aid Center" typed on the same which was returned to Bachrodt signed by Greve. Jefferies testified he in turn called Beltone, talked to Mrs. Watkins, and stated to her that he needed credit information on Beltone. Mrs. Watkins in turn inquired of him with regard to licensing, sales tax, maintenance and insurance. Mrs. Watkins did not recall the credit call but did recall asking him about a 50-mile radius limitation on the use of the car. During this phone call Mrs. Watkins did not advise Jefferies that Greve was not the manager. The comptroller of Bachrodt, Mr. Klinger, testified he called Beltone and also spoke to Mrs. Watkins and advised her that a Beltone manager had been at Bachrodt talking about leasing an automobile. Klinger asked for credit references and Mrs. Watkins gave him the name of two banks in Rockford and one in Kankakee relative to the credit of Beltone and Watkins, Again, there was no indication that Greve was not the manager or that he did not have authority to enter into a lease on behalf of Beltone.
On October 15, 1971, a Camaro automobile was picked up by Greve. Subsequently a 1972 Vega was substituted for the Camaro. Beltone was billed for the sum of $50 for the rental of the Camaro from October 15, 1971, to November 1, 1971. On November 1, 1971, Greve executed a document in which he stated he was leasing automobiles from Lou Bachrodt Chevrolet Leasing Co. as his own responsibility and "in no respect making anyone else liable, including Beltone Hearing Aid Center or Mr. and Mrs. Raymond L. Watkins." This document was admitted into evidence over objection. At no time was this disclaimer of liability as to Beltone or the Watkins ever forwarded to Bachrodt. On November 11, 1971, the $50 invoice was paid with a check from Beltone. On December 3, 1971, a "Motor Vehicle Lease Agreement" and a "Vehicle Lease Order" were mailed to Beltone and subsequently were returned to Bachrodt signed by Greve as "Consultant" and "Consultant and Manager." Beltone was invoiced for the use of the motor vehicle for the month of November in the sum of $100 and again Beltone, on December 7, 971, issued their check and paid this invoice in the sum of $100. Subsequently Beltone was invoiced for the month of December for the use of this vehicle for two months and again this invoice was paid by Beltone's check in the sum of $221.16. Likewise, on January 31, 1972, Bachrodt again billed Beltone for the use of the vehicle and Beltone issued their check in the sum of $110.58 on February 22, 1972. These payments were authorized by Mr. Watkins and were made out on Beltone checks and signed by Mrs. Watkins.
In early February Greve telephoned Jefferies, the leasing manager of Bachrodt, and advised him that his wife was going to work for Beltone and that they needed another vehicle. On February 11, 1972, Greve signed a "Vehicle Lease Order" for a 1972 Monte Carlo. This document was signed by Greve with the title "Beltone" typed under his name. Greve left the employ of Beltone on February 18, 1972. He took both cars with him and Beltone refused to make any payments on the rentals of both cars to Bachrodt. After negotiations the Vega was returned to Bachrodt by Greve on June 19, 1972, and the Monte Carlo on July 24, 1972.
We thus reach the question as to whether Bachrodt has established that Greve was held out to be an implied or apparent agent of the defendant Beltone. We find that the apparent agency was in fact established by the evidence in this case.
In Faber-Musser Co. v. Dee Clay Manufacturing Co. (1920), 291 Ill. 240, 246, 126 N.E. 186, 189, the court stated:
"Circumstantial evidence is ordinarily competent to establish the fact or extent of agency. [Citation.] In case of doubt as to the extent of the agency and the authority of the agent to bind the principal, `reference may be had to the situation of the parties and property, usages of the country on such subjects, the acts of parties themselves, and any other circumstances having a legal bearing and throwing light on the question.'"
"Agency may be established and its nature and extent shown by parol evidence, whether direct or circumstantial, and reference may be had to the situations of parties and property, acts of parties, and other circumstances germane to the question, and if the evidence shows one acting for another under circumstances implying knowledge on the part of the supposed principal of such acts, a prima facie case of agency is established."
See also Mitchell v. Sherman E. McEwen Associates, Inc. (1935), 360 Ill. 278, 283, 196 N.E. 186, 188.
• 1 In a factually different case, the United States Circuit Court of Appeals in Alterman v. Lydick (7th Cir. 1957), 241 F.2d 50, 53, the court discussed the Faber-Musser case and set out the definition in ...