Question

Gilbert Church owned a horse breeding farm in Illinois managed by Herb Bagley. Advertisements for the breeding rights to one of Church Farm’s stallions, Imperial Guard, directed all inquiries to “Herb Bagley, Manager.” Vern and Gail Lundberg bred Thoroughbred horses. The Lundbergs contacted Bagley and executed a preprinted contract giving them breeding rights to Imperial Guard “at Imperial Guard’s location,” subject to approval of the mares by Church. Bag- ley handwrote a statement on the contract that guaranteed the Lundbergs “six live foals in the first two years.” He then signed it “Gilbert G. Church by H. Bagley.” The Lundbergs bred four mares, which resulted in one live foal. Church then moved Imperial Guard from Illinois to Oklahoma. The Lundbergs sued Church for breaching the con- tract by moving the horse. Church claimed that Bagley was not authorized to sign contracts for Church or to change or add terms, but only to present preprinted contracts to potential buyers. Church testified that although Bagley was his farm manager and the contact person for breeding rights, Bagley had never before modified the preprinted forms or signed Church’s name on these contracts. The jury found in favor of the Lundbergs and awarded $147,000 in damages. Church appealed.

Issue Was Bagley authorized to sign and modify contracts on behalf of Church?

Answer 1

ANS- No Bagley was not authorized to sign and modify contracts on behalf of church. He was only responsible to present preprinted contracts to potential buyers.