ON PETITION TO TRANSFER

SULLIVAN, Justice.

Christina Isaac filed an auto insurance claim with Gallant Insurance Company. Gallant contends that she had no coverage because the insurance agency where she purchased the policy, Thompson-Harris Company, did not have authority to bind it. *674The Court of Appeals held that Thompson-Harris had "inherent authority" to bind Gallant. The doctrine of "inherent authority" has no application in this case. However, Gallant's dealings with Isaac did establish coverage under the doctrine of "apparent authority."

Background

In this insurance coverage dispute, Gallant Insurance Company sought a declaratory judgment that automobile insurance coverage was not in effect in respect of a claim filed by Christina Isaac. Isaac and a second plaintiff, Loretta Davis, sought summary judgment on the same issue.

Isaac had acquired insurance on a Pontiac Fiero through Gallant's independent agent, Thompson-Harris Company, in 1994. On the last day that that coverage was in effect, Isaac traded the Fiero for a Pontiac Grand Prix. As explained by the Court of Appeals in its opinion in this case:

To obtain the newly purchased car, the financing bank required Isaac to obtain full coverage on it. That same day, Isaac contacted Thompson-Harris to notify it that she was purchasing the new - car, and to discuss enhancing the existing insurance policy to meet bank requirements. Isaac told a Thompson-Harris employee that she must obtain 'full insurance coverage' as a condition to receiving a loan. She also told the employee at Thompson-Harris that her current coverage expires on December 3, 1994, the next day.

In response, the Thompson-Harris employee informed Isaac that because their ageney was about to close for the weekend, she would immediately 'bind' coverage on the 1988 Grand Prix. They decided that Isaac would come in to Thompson-Harris on Monday, December 5, 1994, to complete the paperwork and pay the down payment on the premium. The employee also informed Isaac that the new coverage on her Pontiac Grand Prix would include the same coverage existing from her Pontiac Fie-ro, along with additional coverage to comply with conditions set by the bank.

The next day, on December 3, 1994, a different employee completed the 'Personal Policy Change Request! This form deleted the 1987 Pontiac Fiero from Isaac's Policy and replaced it with the 1988 Pontiac Grand Prix. It also added additional coverage to the policy as well as additional loss payee/lienholder. The Personal Policy Change Request listed the 'Agency' and 'Producer' as Thompson-Harris, and stated that the 'effective date of change' was December 3, 1994. Towards the bottom of the form, the Thompson-Harris employee typed '[slhe will be in at 9:00 a.m. Monday, 12/5/94, to [sic] down [sic] on renewal. What is [sic] new rate? Thanks' (R. 380). This form, which requested the listed changes, was faxed to Insurance Brokers of Indiana, Inc., on December 3, 1994.

On December 4, 1994, while driving her Pontiac Grand Prix, Isaac collided with another car in which Davis was a passenger. The next day, as planned, Isaac went to Thompson-Harris and paid $133.00 down payment on the new insurance policy. She also reported the accident. Thompson-Harris completed an 'Indiana Operator's Vehicle Crash Report, which notified the State Police that Isaac had insurance coverage at the time of the accident, on December, 4, 1994. Thompson-Harris completed that form on behalf of Gallant. Later, on or about December 22, 1994, Gallant renewed Isaac's insurance policy, with an effective period of December 6, 1994 to June 6, 1995.

Gallant Ins. Co. v. Isaac, 732 N.E.2d 1262, 1265-66 (Ind.Ct.App.2000) (quotations in *675original). When Isaac submitted a claim to Gallant in respect of the December 4 'accident, Gallant took the position that no coverage was in foree on that date. As noted, the company sought a declaratory judgment to that effect. Isaac and Davis (who had been a passenger in the vehicle which collided with Isaac's) each sought summary judgment on that question, which the trial court granted.

The Court of Appeals affirmed. See Isaac, 732 N.E.2d at 1270. In doing so, it held that Thompson-Harris had "inherent authority" to bind Gallant, relying on our decision in Menard, Inc. v. Dage-MTI, Inc., 726 N.E.2d 1206, 1211 (Ind.2000), reh'g denied. While we agree with the result reached by the trial court and Court of Appeals, we do so for reasons different than those given by the Court of Appeals. We granted transfer to explain why the concept of "apparent authority," rather than the concept of "inherent authority" discussed in Menard, is applicable in this case. Gallant Ins. Co. v. Isaac, 741 N.E.2d 1259 (Ind.2000) (table).

Discussion

I

Menard was a dispute over whether the president of a corporation who signed an agreement to sell certain corporate-owned real estate had authority to do so. We began our analysis of the question by recognizing the two main classifications of authority: "actual authority" and "apparent authority." Menard, 726 N.E.2d at 1210. Actual authority, we said, is created "by written or spoken words or other conduct of the principal which, reasonably interpreted, causes the agent to believe that the principal desires him so to act on the principal's account." Id. (citing Scott v. Randle, 697 N.E.2d 60, 66 (Ind.Ct.App.1998), transfer demied; Restatement (Second) of Agency §§ 7, 38 (1958)). And we said that apparent authority refers to a third party's reasonable belief that the principal has authorized the acts of its agent; it arises from the principal's indirect or direct manifestations to a third party and not from the representations or acts of the agent. Id. (citing Pepkowski v. Life of Indiana Ins. Co., 535 N.E.2d 1164, 1166-67 (Ind.1989); Drake v. Maid-Rite Co., 681 N.E.2d 734, 737-38 (Ind.Ct.App.1997), reh'y denied.).

In Menard, we also discussed a third form of agency relationship-"inherent authority"-which is grounded in neither the principal's conduct toward the agent nor the principal's representation to a third party, but rather in the very status of the agent. Id. at 1211-12. The concept of inherent authority "originates from the customary authority of a person in the particular type of agency relationship." Id. at 1211 (citing Cange v. Stotler & Co., 826 F.2d 581, 591 (7th Cir.1987) (citing in turn Restatement (Second) of Agency § 161 emt. b (1958))).

Because the agent at issue in Menard was the president of the company, we found the concept of inherent authority-rather than actual or apparent authority-controlled our analysis. We said that the purchaser "did not negotiate and ultimately contract with a lower-tiered employee or a prototypical 'general' or 'special agent, with respect to whom actual or apparent authority might be at issue. [The purchaser] dealt with the president of the corporation, whom [tlhe law recognizes ... [as one of] the officers [who] are the means, the hands and the head, by which corporations normally act." Id. at 1212 (internal quotations and citations omitted).

Thompson-Harris, the insurance agency with which Isaac dealt in this case, was, in our view, the "prototypical 'general' or 'special' agent, with respect to whom actual or apparent authority might be at *676issue." Id. It was not an agent with inherent authority, i.e., a person with a particular status like president. CJ. id. (holding that the president of the company had inherent authority); Fidelity & Casualty Co. v. Carroll, 186 Ind. 633, 635-36, 117 N.E. 858, 859 (1917) (ruling that a corporation's "executive or administrative officers . may be termed its inherent agen-cles"); Community Care Centers, Inc. v. Indiana Dep't of Pub. Welfare, 468 N.E.2d 602, 604 (Ind.Ct.App.1984) (holding that the corporate attorney did not have inherent authority to bind corporation), transfer denied; Burger Man, Inc. v. Jordan Paper Prod., Inc., 170 Ind.App. 295, 311-13, 352 N.E.2d 821, 831-82 (1976) ("When the president and general manager does an act within the domain of the general objects or business of the corporation, and within the seope of the usual duties of the chief officer, it will be presumed that he had the authority to do it, and whoever would assert the contrary must prove it."). The Court of Appeals erred in holding that Thompson-Harris had inherent authority to bind Gallant.1

II

Although we find no basis for concluding that Thompson-Harris had inherent authority to bind Gallant, we do conclude from our review of the designated evidence that there was no genuine issue of material fact on the issue of whether Thompson-Harris had apparent authority to bind Gallant and therefore that the plaintiffs were entitled to summary judgment on the coverage issue as a matter of law. See Ind. Trial Rule 56(C).

This court last dealt with the question of apparent authority in the insurance context in Pepkowski v. Life of Indiana Ins. Co., 535 N.E.2d 1164 (Ind. 1989). In that case, the question was whether an employee of the plaintiff's employer who handled group health insurance for the employer had apparent authority to bind the insurance company providing the group coverage. In finding the employee not to have apparent authority, we described apparent authority as follows:

Apparent authority is the authority that a third person reasonably believes an agent to possess because of some manifestation from his principal. Warner v. Riddell Nat'l Bank, 482 N.E.2d 772, 775 (Ind.Ct.App.1985)[, transfer denied.] See also Grosam v. Laborers' Int'l Union of N. Am., 489 N.E.2d 656, 658 (Ind.Ct.App.1986)[, transfer denied.] The necessary manifestation is one made by the principal to a third party, who in turn is instilled with a reasonable belief that another individual is an agent of the principal. Swanson v. Wabash College, 504 N.E.2d 327, 332 (Ind.Ct.App.1987); Storm v. Marsischke, 159 Ind.App. 136, 304 N.E.2d 840, 842 (1973); Kody Eng'g Co. Inc. v. Fox & Fox Ins. Agency Inc., 158 Ind.App. 498, 505-06, 303 N.E.2d 307, 311 (1973). It is essential that there be some form of communication, direct or indirect, by the principal, which instills a reasonable be*677lief in the mind of the third party. Swanson, 504 N.E.2d at 332; Storm, 304 N.E.2d at 843. Statements or manifestations made by the agent are not sufficient to create an apparent agency relationship. Swanson, 504 N.E.2d at 332; Storm, 304 N.E.2d at 843.

Pepkowski, 585 N.E.2d at 1166-67.

Applying these principles 'to the case at hand, it seems to us that the key is determining whether Gallant made the "necessary manifestation" to "instill a reasonable belief in the mind of" Isaac that Thompson-Harris had authority to transfer the coverage from her Fiero to her Grand Prix and renew the policy. There are several additional cases, some cited in Pepkowski, that help us with this determination.

First, it is clear that the "manifestations" referred to in Pepkowski need not be in the form of direct communications, "but rather the placing of the agent in a position to perform acts or make representations which appear reasonable to a third person is a sufficient manifestation to endow the agent with apparent authority." Herald Telephone v. Fatouros, 431 N.E.2d 171, 175 (Ind.Ct.App.1982) (quoting Burger Man, Inc., 170 Ind.App. at 312, 352 N.E.2d at 832).

Storm v. Marsischke explained that "[sluch a manifestation by the principal may be found .... where the principal clothes or allows a special agent to act with the appearance of possessing more authority than is actually conferred." 159 Ind.App. 136, 138, 304 N.E.2d 840, 842-43 (1973) (citing Farm Bureau Mutual Ins. Co. v. Coffin, 136 Ind.App. 12, 186 N.E.2d 180 (1962)). In the Coffin case, an insured had called his auto insurer's home office and said that he wanted to transfer his insurance from a Chevrolet to a Buick and increase his coverage. He was connected with one James R. Pierson who told him that he had the coverage he sought as of that moment. As it turned out, Pierson was not an insurance agent but the Typing Supervisor in the Auto Underwriters Department. The insured subsequently presented a claim, which the insurer denied on the basis that Pierson had no authority to bind the company. The Court of Appeals held that the insurer had "clothed Pierson with apparent authority,. [Insured] called the [insurer's] home office and stated that he wanted to transfer his insurance. Employees of the [insurer] (principal) then connected [insured] (third party) with Pierson (apparent general agent)." 186 Ind.App. at 19, 186 N.E.2d at 184.

In Old Line Auto. Insurors v. Kuehl, an insured had for some time prior to the issuance of the auto insurance policy at issue in the case dealt with the insurer through one Donald R. Crabb. He purchased a policy on a Studebaker through Crabb. Crabb subsequently arranged the transfer of the coverage of that policy from the Studebaker to a Dodge. When the insurer sent the insured the policy, it did not tell the insured that it would not be responsible for payments made to its agent Crabb. The insured in fact paid his premiums to Crabb who, at some point in time, failed to forward them to the insurer. When this occurred, the insurer did not notify the insured that the policy was can-celled. The insured subsequently presented a claim, which the insurer denied on the basis that the policy had been cancelled. The Court of Appeals held that "[u)nder these cireurostances we believe [the insured] was justified in believing that Crabb, as the agent of [the insurerl, had the authority to collect the premiums due on the policy in question here." 127 Ind.App. 445, 455, 141 N.E.2d 858, 862 (1957).

In the case before us today, the undisputed facts show that when Isaac first *678acquired the Gallant policy on her Fiero, a Thompson-Harris employee filled out Gallant's pre-printed insurance application form. After the pre-printed application form and a pre-application checklist were signed by Isaac and the employee, the employee told Isaac that her coverage with Gallant would be "bound" as of June 2, 1994. The employee further told Isaac that she would receive the actual insurance policy from Gallant in the near future. Isaac did in fact receive Gallant Indiana Personal Auto Policy No. IN 04151290 shortly thereafter. When one of Isaac's premiums was not received on time, Gallant issued a written "Notice of Cancellation" indicating that the policy would be canceled if the premium was not received by a particular date. When payment was received before that date, Insurance Premium Company, which received Isaac's premium payments on behalf of Gallant, issued an "Agent Notification of Reinstatement" to Thompson-Harris and a reinstatement notice to Isaac.

While Gallant argues that some of the designated evidence raises an issue of fact concerning Thompson-Harris's actual authority to bind Gallant, the evidence appears to us without dispute that Thompson-Harris had apparent authority to bind Gallant, eg., Gallant's dealings with Isaac just recited contained the manifestations required under applicable case law to cause Isaac reasonably to believe that Thompson-Harris had authority to bind Gallant.

We have already recounted under Background, supra, Isaacs contacts with Thompson-Harris at the time of the purchase of the Grand Prix and the accident. While Gallant again argues that there are some factual disputes surrounding these events, the evidence appears to us uncon-troverted that no Thompson-Harris employee gave Isaac any indication that coverage on the Grand Prix was not in force. Cf. Michigan Mut. Ins. Co. v. Sports, Inc., 698 N.E.2d 834, 840 n. 17 (Ind.Ct.App.1998) ("If the third person knows, or in the exercise of reasonable care should know, that the agent is exceeding the agent's actual authority, the principal will not be bound"), transfer denied.

Because we find that Thompson-Harris had apparent authority to bind Gallant with respect to Isaac, we hold that it was appropriate for the trial court to grant summary judgment to the plaintiffs on the question of whether Isaac had coverage under the Gallant policy at the time of her accident.

Conclusion

Having previously granted transfer, thereby vacating the opinion of the Court of Appeals, see Ind. Appellate Rule 11(B)(8), we now affirm the judgment of the trial court.

SHEPARD, C.J., and DICKSON, BOEHM, and RUCKER, JJ., concur.

Mr. Justice Garwood

delivered the opinion of the Court.

*177Petitioners Humble Oil & Refining Company and Mrs. A. C. Love and husband complain here of the judgments of the trial court and the Court of Civil Appeals in which they were held in damages for personal injuries following a special issue verdict at the suit of respondent George F. Martin acting for himself and his two minor daughters. The injuries were inflicted on the three Martins about the noon hour on May 12, 1947, in the City of Austin, by an unoccupied automobile belonging to the petitioners Love, which, just prior to the accident, had been left by Mrs. Love at a filling station owned by petitioner Humble for servicing and thereafter, before any station employee had touched it, rolled by gravity off the premises into and obliquely across the abutting street, striking Mr. Martin and his children from behind as they were walking into the yard of their home, a short distance downhill from the station.

The trial court rendered judgment against petitioners Humble and Mrs. Love jointly and severally and gave the latter judgment over against Humble for whatever she might pay the respondents. The Court of Civil Appeals affirmed the judgment after reforming it to eliminate the judgment over in favor of Mrs. Love, without prejudice to the right of contribution by either defendant under Article 2212, Vernon’s Ann. Civ. Stat., 216 S. W. (2d) 251. The petitioners here respectively complain of the judgment in favor of the Martins, and each seeks full indemnity (as distinguished from contribution) from the other.

The apparently principal contention of petitioner, Humble, is that it is liable neither to respondent Martin nor to petitioner Mrs. Love, since the station was in effect operated by an independent contractor, W. T. Schneider, and Humble is accordingly not responsible for his negligence nor that of W. V. Manís, who was the only station employee or representative present when the Love car was left and rolled away. In this conncetion, the jury convicted petitioner Humble of the following acts of negligence proximately causing the injuries in question: (a) Failure to inspect the Love car to see that the emergency brake was set or the gears engaged; (b) failure to set the emergency brake on the Love car; (c) leaving the Love car unattended on the driveway. The verdict also included findings that Mrs. Love “had delivered her car to the custody of the defendant Humble Oil & Refining Company, before her car started rolling from the position in which she had parked it”; that the accident was not unavoidable; and that no negligent act of either of petitioners was the sole proximate cause of the injuries in question. We think the Court of Civil Appeals properly held Humble responsible for the operation of the station, which ad*178mittedly it owned, as it did also the principal products there sold by Schneider under the so-called “Commission Agency Agreement” between him and Humble which was in evidence. The facts that neither Humble, Schneider nor the station employees considered Humble as an employer or master; that the employees were paid and directed by Schneider individually as their “boss”, and that a provision of the agreement expressly repudiates any authority of Humble over the employees, are not conclusive against the master-servant relationship, since there is other evidence bearing on the right or power of Humble to control the details of the station work as regards Schneider himself and therefore as to employees which it was expressly contemplated that he would hire. The question is ordinarily one of fact, and where there are items of evidence indicating a master-servant relationship, contrary items such as those above mentioned cannot be given conclusive effect. Restatement of the Law, Agency, Sec. 220; Gulf Refining Company v. Brown, (C. C. A. 4th Cir.) 93 F. (2d) 870, 116 A. L. R. 449, see also for general discussion of subject, Annotation in 116 A. L. R. 459. Even if the contract between Humble and Schneider were the only evidence on the question, the instrument as a whole indicates a master-servant relationship quite as much as, if not more than, it suggests an arrangement between independent contractors, For example, paragraph 1 includes a provision requiring Schneider “to make reports and perform other duties in connection with the operation of said station that may be required of him from time to time by Company." (Emphasis supplied). And while paragraph 2 purports to require Schneider to pay all operational expenses, the schedule of commissions forming part of the agreement does just the opposite in its paragraph (F), which gives Schneider a 75% “commission” on “the net public utility bills paid” by him and thus requires Humble to pay three-fourths of one of the most important operational expense items. Obviously the main object' of the enterprise was the retail marketing of Humble’s products with title remaining in Humble until delivery to the consumer. This was done under a strict system of financial control and supervision by Humble, with little or no business discretion reposed in Schneider except as to hiring, discharge, payment and supervision of a few station employees of a more or less laborer status. Humble furnished the all important station location and equipment, the advertising media, the products and a substantial part of the current operating costs. The hours of operation were controlled by Humble. The “Commission Agency Agreement”, which evidently was Schneider’s only title to occupancy of the premise, was terminable at the will of Humble. The so-called “rentals” were, at least in part, based on the amount of Hum*179ble’s products sold, being, therefore, involved with the matter of Schneider’s remuneration and not rentals in the usual sense. And, as above shown, the agreement required Schneider in effect to do anything Humble might tell him to do. All in all, aside from the stipulation regarding Schneider’s assistants, there is essentially little difference between his situation and that of a mere store clerk who happens to be paid a commission instead of a salary. The business was Humble’s business, just as the store clerk’s business would be that of the store owner. Schneider was Humble’s servant, and so accordingly were Schneider’s assistants who were contemplated by the contract. Upon facts similar to those at bar but probably less indicative of a master-servant relationship, the latter has been held to exist by respectable authority, which seems to reflect the prevailing view in the nation. Gulf Refining Company v. Brown, supra, and cases cited therein. If the Brown case be said to conflict with the later decision of the 5th Circuit in Bartle v. Travellers Insurance Co., 171 F. (2d) 469, the facts of the latter are yet more persuasive of an independent contractor type of relationship than the instant case, so the decision is not contrary to our holding.

• The evidence above discussed serves to distinguish the instant case from The Texas Company v. Wheat, 140 Texas 468, 168 S. W. (2d) 632, upon which petitioner Humble principally relies. In that case the evidence differed greatly from that now before us. It clearly showed a “dealer” type of relationship in which the lessee in charge of the filling station purchased from his landlord, The Texas Company, and sold as his own, and was free to sell at his own price and on his own credit terms, the company products purchased, as well as the products of other oil companies. The contracts contained no provision requiring the lessee to perform any duty The Texas Company might see fit to impose on him, nor did the company pay any part of the lessee’s operating expenses, nor control the working hours of the station. From the court’s comments in distinguishing Texas Co. v. Freer, 151 S. W. (2d) 907 (Tex. Civ. App., writ dism., judgm. cor.), and Gulf Refining Co. v. Rogers, 57 S. W. (2d) 183 (Tex. Civ. App., writ dism.), the differences between the Wheat case and the instant case became still more evident. Much the same may be said of The Texas Company v. Grant, 143 Texas 145, 182 S. W. (2d) 996, decided on the strength of the Wheat case but involving very meagre evidence on the point in question and even less proof of a master-servant relationship than the Wheat case. American National Insurance Company v. Denke, 128 Texas 229, 95 S. W. (2d) 370, denied liability of the insurance company to third parties injured by an automobile *180driven by a soliciting agent of the company in the course of calling on policyholders or “prospects” and owned by the agent’s wife. While that case does illustrate that tight control by the alleged “master” over the primary sphere of the alleged “servant’s” work does not of itself entail responsibility for his acts in a sphere which is not subject to control, we think the factual situation is essentially different from that before us which, as stated, resembles one of a clerk in a store owned and controlled by the alleged “master”.

Petitioner Humble also earnestly contends in this court that, whatever its responsibility for the conduct of the station employees, there is yet no evidence to support the jury findings of negligence. Assuming, as is apparently the case, that the point was sufficiently presented in the Court of Civil Appeals, we nevertheless think it not well taken. The evidence conclusively establishes the following facts: The filling station is and has been for some years located on the nortwest comer of West Avenue and 12th street, facing southwardly onto 12th street, which runs downhill at an obviously sharp grade from east to west, so that the east part of the station premises is considerably higher than the west portion. 12th street at this point is a rather crowded thoroughfare, especially at times such as that at which the accident in suit occurred, and is more or less completely built up on both sides with small business houses for at least the length of a city block immediately westward and downhill from the station, including the combined residence and business house of respondent Martin, which lies diagonally across 12th street from the station and about a quarter of a block below it. In front or south of the main station house or office and between it and 12th street lie the gasoline pumps and appurtenant loading lanes, the pumps being in two groups about twenty feet apart and together forming an east-west line about twenty seven feet long more or less parallel to 12th street and separating the two loading lanes that lie parallel to the line of pumps, one on each side. Mrs. Love left her car headed west in the outside or southerly lane at a point about midway between the two pump groups, and from this spot it escaped shortly thereafter. A few feet to the southwestward of the westernmost pump is a broad westerly exit from (or entrance to) the station, opening south into 12th street, so that an automobile going by the route from the spot where Mrs. Love left her car to 12th street could simply proceed some ten or twelve feet forward bearing slightly to the left and enter 12th street at an angle. The whole filling station grounds, including the mentioned driveways and exit, are of relatively smooth cement or concrete surface but are not of uniform level *181or grade. The loading lane from which the Love car escaped is nearer level than some other parts of the station area and definitely more so than the corresponding portion of 12th street but has a visible fall toward the west of about six inches per twenty-seven feet. Immediately westward of the westernmost pump the downgrade increases in degree, and at about this point there also begins a rather sharp slope southwestwardly toward and through the above mentioned exit into 12th street. That a car, if left unsecured and driverless where Mrs. Love left her car, might easily roll thence into 12th street and thereafter down the steep slope of the latter, was or should have been obvious to the station employees and Mrs. Love, as should also have been the further fact that such an occurrence would probably result in serious damage to persons or property. There is little doubt under the evidence that, when Mrs. Love left her car at the time and place in question, she did so for the purpose of its being serviced by Humble and with the latter’s actual knowledge and consent.

It seems proper that the operator of a filling station should owe to that part of the public which might be affected — such as respondent Martin here — the duty of ordinary care to prevent cars left with it under such circumstances from rolling away and injuring persons or property. If there were any doubt about this in the ordinary case, there could hardly be any in a situation like the present, in which both the possibility of such an accident and the probability of serious results therefrom were obvious. If, to take an extreme example, the station employee, Manis, had been otherwise unoccupied and standing close by Mrs. Love’s car in a position where he could readily and with safety to himself have stopped it but, after seeing it start, had yet made no effort to stop it, there could be little doubt that such conduct would constitute actionable negligence on Humble’s part toward the public. Similarly, if Mrs. Love had been a stranger visiting the station for the first time and, with the previous knowledge of the station employees, had left her car unoccupied and unbraked beside the pumps, so that it later rolled away, it seems plain that Humble ought to be responsible for the consequences to innocent third persons. These examples illustrate the existence of the duty of the station operator to the public and also the corollary proposition that the operator is not free to omit precaution or effort simply because the particular car in question is brought onto the premises by its owner or happens to escape before the station operator has taken physical control of it. They do not, however, throw much light on the problem of the quantum of care or precaution necessary to meet the standard of reasonable prudence.

*182As to the latter question, undoubtedly the peculiar physical characteristics of the station, all of which must be taken as a matter of law to be well-known to Humble, have a legitimate bearing, and as a result, we think the amount of care should plainly be greater than, for example, in the case of a station located in a flat area and without sloping driveways. Should authority be needed to support such a conclusion, it has been held in Texas and elsewhere that, under the so-called rule of res ipsa loquitur, evidence that a defendant’s car was parked by him in a heavily sloping street and thereafter rolled down without a driver, damaging the plaintiff’s person or property, was sufficient to carry the case to the jury on the issue of the defendant’s negligence, even though the only other evidence on the point was direct evidence by the defendant or others that the emergency brake was carefully set at the time the car was parked. Ketchum v. Gillespie, Tex. Civ. App., 145 S. W. (2d) 215; Glaser v. Schroeder, 269 Mass. 337, 168 N. E. 809. While we do not consider the present case one of res ipso, loquitur or other rule of circumstantial evidence in so far as the liability of petitioner Humble is concerned, the decisions mentioned do necessarily imply that the matter of leaving a car on a sloping way is one in which the ordinarily prudent man would be expected to take a greater amount of precaution than otherwise. Assuming that in the instant case the station employee, Manis, were unoccupied at the time Mrs. Love left her car in the pump area, knew she had herself taken no precautions to keep the car stationary and yet stood idly by in his office for even two or three minutes, we think there would be a serious question as to whether Humble would not be guilty of negligence as a matter of law. This, because his knowledge would, by all reasonable standards, call for quicker action than might otherwise be required. The only difference between such a situation and the instant case are, first, that in the latter Manis might conceivably have been justified in relying on Mrs. Love herself to take the necessary precautions; and, secondly, that Manis was evidently occupied with servicing another car at the pumps and other successive duties from the time Mrs. Love left her car until after it rolled away.

As to the first difference, while Mrs. Love was a regular customer of the station, understood the necessity of securing her car and was negligent in failing to secure it, we cannot say that, as a matter of law, Manis exercised sufficient care in the discharge of his duty to the public by simply assuming she had secured it. A plaintiff injured when standing close to a public street without keeping a lookout, is not, as a matter of law, to be acquitted of contributory negligence because he assumes that *183the defendant’s oncoming car will be driven with due care and will therefore not strike him. Cronk v. J. G. Pegues Motor Co., 167 S. W. (2d) 254 (Tex. Civ. App., writ ref. w. o. m.). And there is a distinction between the general axiom that a person is not bound to anticipate the negligence of others and the idea that one may always discharge a duty of due care to the public by relying on performance by another of the same duty owed by the latter. Mrs. Love did not indicate to Manis that she had secured or intended to secure the car, and we think any implied reliance by him upon her doing so was merely a circumstance to be considered by the jury on the issue of negligence.

Nor can we say, as a matter of law, that the circumstance of Manis being busy with other matters at the time shows him to have discharged his duty of due care. It was clearly not very difficult for him to have interrupted his other work for the brief time an inspection would require. The jury might well have thought it a more urgent matter to make this inspection than to collect for soft drinks purchased by customers, or do several other things he appears to have done before the car rolled away. Plainly any unfavorable consequences of interrupting these latter duties would be less serious than those of a failure to inspect an unguarded car. As to the matter of just how much time elapsed between the moment Mrs. Love left her car and the moment it rolled away, while the preponderance of the evidence does indicate that this period was rather short, we cannot say as a matter of law that it was only “two or three minutes” as testified to by Manis. His estimate was at best an estimate and, coming from him as an employee of the defendant Humble and one who might himself be responsible in the premises, need not be taken as conclusive, while at the same time there is at least some evidence from the various other witnesses indicating that a considerably greater period of time might have elapsed. In any event the period is itself not conclusive one way or the other. If with his knowledge that the car was left on the sloping lane, it was reasonable for Manis to forego an inspection for two or three minutes, it was doubtless reasonable for him to do so for a still longer time. On the other hand, we think the jury might properly have considered even two or three minutes too long a delay under the circumstances. The point was merely evidentiary and no more the proper subject of a special issue than, for example, the question of just what other duties Manis was in fact performing during the period.

Other contentions (by both petitioners) stem from an apparent confusion in the jury findings to the effect that, while Mrs. Love negligently failed to set the emergency brake (she *184admitted failing to set it), she nevertheless did “properly place the gears of her car in reverse” (as she — and she alone — testified) when she left it. The jury also found upon sufficient evidence that the gears were not in defective condition. An apparently impartial witness testified rather convincingly that when he examined the car immediately after it stopped in respondent Martin’s yard, the gear was in the neutral position. The evidence does not admit of any theory of the accident such as the meddling of a third party or the intervention of any force other than gravity. If the car were left in reverse gear, it seems clear that neither Humble nor Mrs. Love would be liable. It is common knowledge that such a procedure is quite as safe a method of securing a car as setting the emergency brake, and that cars in reverse gear do not roll on grades such as that prevailing at and even beyond the place where the Love car undoubtedly was left. Mrs. Love could not be held negligent if she took an obviously sufficient precaution, and if she did take it, the failure of Humble to inspect was not the proximate cause of the accident, nor was its failure to take other precautions negligence. The Court of Civil Appeals considered that, under the circumstances, the finding that the car was left in reverse was “almost incredible”. Without the least reflection upon the good faith of Mrs. Love, we more than agree with this view and think this Court is not bound by the finding or Mrs. Love’s statement, which is its only support; her testimony being in our judgment at variance with elemental physical facts and common knowledge and so not evidence, regardless of the good faith of the witness. Seiwell v. Hines, 273 Pa. 259, 116 A. 919, 21 A. L. R. 139; Austin v. Neiman, 148 S. W. (2d) 794 Tex. Com. App.), 20 Am. Jur., Evidence, Sec. 1183. This conclusion disposes of the only serious contention of petitioner Humble with respect to its negligence not being a proximate cause of the accident. It also eliminates the alleged conflicts in the verdict except that concerning the answer to Special Issue No. 17 to the effect that petitioner Mrs. Love was not negligent “in leaving her car on the driveway, under the facts and circumstances then existing.” We agree with the Court of Civil Appeals that this latter finding is not in irreconcilable conflict with the finding that Mrs. Love was negligent in failing to set the emergency brake of her car. The former simply referred to the act of leaving the car on a slope.

As to the question of which, if either, of the two petitioners is entitled to judgment of indemnity against the other, we think that under the rule as laid down by this Court in Wheeler v. Glazer, 137 Texas 341, 153 S. W. (2d) 449 and more recently in Austin Road Company v. Pope, 147 Texas 430, 216 S. W. (2d) *185563, petitioner Humble is entitled to prevail, and that the Court of Civil Appeals accordingly failed to do Humble complete justice in merely eliminating the trial court judgment over in favor of petitioner Mrs. Love. To paraphrase the words of Chief Justice Alexander in the first mentioned case, “Mrs. Love was a wrongdoer as to Humble, but Humble was not a wrongdoer as to Mrs. Love.” That Humble by its failure to inspect and secure Mrs. Love’s car breached a duty to that part of the public which might be affected and cannot excuse itself by saying it assumed Mrs. Love would herself use due care to make her car secure, does not mean that Humble breached a duty to her by not making an inspection and correcting the dangerous situation she herself had negligently created. On the other hand, disregarding as we do the finding that she placed her car in reverse gear, we think Mrs. Love, by thus leaving her car unsecured in a situation, which the evidence shows she knew to be dangerous, at a time when she knew the only available employee was busy with other duties and would probably not give it immediate attention, breached a duty to Humble as well as to the public. The finding that she “delivered” the car to Humble is a mere legal conclusion that adds nothing to the undisputed facts in evidence. Even if it meant that Manis expressly consented when she told him she was leaving the car, instead of receiving her statement in silence, it would still make no difference. There is no contention that she told Manis the car was unsecured or that he directly or indirectly told her she need not herself secure it or in any way mislead her in the matter. That a bailment for mutual benefit was created does not change the situation under these facts. Even though a bailee, Humble, as between it and Mrs. Love ,had the right to assume that she had “delivered” the car in a safe condition and, being thus misled into liability to the Martins, was the victim of wrong rather a wrongdoer.

The judgment of the Court of Civil Appeals is reversed as to that portion of it which merely eliminates the part of the trial court judgment granting recovery over against petitioner Humble Oil & Refining Company in favor of petitioner Mr. and Mrs. A. C. Love and adjudicates the rights between these defendants to be determinable on the basis of contribution under Art. 2212 Vernon’s Annotated Civil Statutes, rather than on an indemnity basis. The judgment of the trial court is modified to allow the petitioner first named recovery against petitioner Mrs. A. C. Love by way of indemnity for such sums as it may pay and be required to pay to the plaintiffs, George F. Martin et al, or any of them under the judgment rendered against. it in their favor and so-as to allow said petitioner *186Humble Oil & Refining Company, recovery against petitioner Mrs. Love for all court costs incurred by the former. In all other respects the judgments of the trial court and Court of Civil Appeals are affirmed.

Associate Justice Sharp, Chief Justice Hickman, and Associate Justice Taylor concur in part and dissent in part, Associate Justice Hart disqualified and not sitting.

Opinion delivered June 15, 1949.

Mr. Justice Sharp,

joined by Justice Taylor, dissenting.

I am in accord with the holding of liability of both Mrs. Love and Humble for the injuries sustained by respondents, but respectfully dissent from the holding that Humble be indemnified by Mrs. Love.

The facts are undisputed that Mrs. Love, who was a regular customer of Humble, left her car on this occasion with Humble to have it serviced. When Mrs. Love first drove up to the service station, Manis, one of the employees of Humble, was working on another car. Mrs. Love told Manis what she wanted done to her car, and then sat in her car for several minutes, when she said to Manis: “I want to get some groceries at the store; will it be all right to leave my car here and go get them?” Manis replied: “That is perfectly all right, leave it right where it is.” Mrs. Love then killed the motor, put the car in reverse gear, and left the station to go to the grocery store. She did not set the hand brake. The gears and clutch of the Love car were shown to be in good condition. Some time after Mrs. Love left the station the car was seen to commence rolling slowly towards the street. At this time Manis was in the office, and he saw the car crossing the street.

The jury found that the car had been delivered into the custody of Humble prior to the time that it started rolling from the position in which Mrs. Love had left it. The jury also found Humble guilty of the following acts of negligence, which proximately caused the injuries complained of: (1) Failure to inspect the Love car to see that the brake was set or the gears engaged; (2) failure to set the brakes on the Love car; and (3) leaving the Love car unattended on its driveway. The jury also found that failure to warn Mrs. Love that the driveway where she parked her car was not level was negligence.

The jury found that the gears of Mrs. Love’s car were not *187defective, and that Mrs. Love did not fail to properly place the gears of her car in reverse to prevent it rolling. The jury found that Mrs. Love was guilty of negligence in failing to set the emergency brake on the car. They also found that Mrs. Love “in leaving her car on the driveway under the facts and circumstances then existing” was not negligence. None of the acts of negligence of either Humble or Mrs. Love was found by the jury to be the sole proximate cause of the injuries to the Martins.

Based upon these findings of the jury, the trial court entered judgment in favor of respondents against Humble and Mrs. Love, and in favor of Mrs. Love as indemnity against Humble, The Court of Civil Appeals reversed the judgment of the trial court, and remanded this cause to the trial court to be retried upon the issue of contribution between Humble and Mrs. Love, as provided for in Article 2212. Mrs. Love contends that the judgment of the trial court should be sustained, while Humblé contends that the judgment of the trial court should be reversed, and that judgment be rendered in its favor as indemnity against Mrs. Love.

Certain fundamental rules are established authorizing a party under certain facts to be entitled to contribution or indemnity against the other party. Independently of any statute relating to contribution, the general.rule, based upon consideration of public, policy, is that there can be no contribution as between joint tort-feasors equally guilty. Oats v. Dublin Nat’l Bank, 127 Texas 2, 90 S. W. (2d) 824; Gattegno v. The Parisian (Tex. Com. App.), 53 S. W. (2d) 1005; Wheeler v. Glazer, 137 Texas 341, 153 S. W. (2d) 449; Austin Road Co. v. Pope, 147 Texas 430, 216 S. W. (2d) 563.

In Oats v. Dublin Nat’l Bank, supra, this Court said: “Aside from the statute, it is held in negligence cases that, where two persons are liable to another for tort, the active wrongdoer should indemnify the one whose wrong is only passive. City of San Antonio v. Smith, 94 Texas 266, 271, 59 S. W. 1109; East Texas Public Service Co. v. Johnson (Tex. Com. Appls.) 6 S. W. (2d) 344. In other cases the principal delinquent is often held responsible to the codelinquent when under the facts the parties are not equally culpable. 10 Tex. Jur. pp. 554, 555, sec. 15; 6 R. C. L. pp. 1057, 1058, sec. 18.”

Article 2212 of the Revised Statutes is a departure from the general rule, and permits a tort-feasor, when the evidence justifies it, to enforce contribution.

*188The majority opinion of this Court reverses both the judgment of the trial court and that of the Court of Civil Appeals, and renders judgment that Humble recover against Mrs. Love, by way of indemnity, such sums as it may pay or be required to pay to the Martins. In support of this holding the cases of Wheeler v. Glazer and Austin Road Co. v. Pope, supra, are cited. In neither of those cases was it held that a negligent defendant was entitled to indemnity from a negligent codefendant. In the first case, Wheeler v. Glazer, we held that a negligent defendant in a tort action was not entitled to indemnity from a codefendant who was found by the jury not to have been negligent as to him. The question there decided, as I view it, is not at all analogous to the question under review. There one of the defendants exercised ordinary care to avoid a collision with the other defendant’s truck, and was not, therefore, a wrongdoer as to him. In Wheeler v. Glazer this Court considered both the general rule and Article 2212 of the Statutes, and I quote the following from that opinion:

“In 10 Tex. Jur. 554 it is said: ‘Thus, where the parties are shown not to have been equally guilty, the principal delinquent may be held responsible to a codelinquent for damage paid by reason of the offense in which both were concerned in different degrees as perpetrators.’ ”

The opinion further says: “Where the injury forming the basis for the judgment against the joint tort-feasor results from a violation of a duty which one of the tort-feasors owes to the other, the latter, at common law, is entitled to contributions or indemnity from the former.” And in discussing Article 2212 it is also said: “Moreover, the statute (Article 2212) here relied on by Glazer was enacted to prevent inequities between joint tort-feasors. It would not be within the spirit of this statute to allow a right of contribution in favor of a tort-feasor where the event which brought about the injury resulted from his violation of a duty which he owed to the other tort-feasor from whom contribution is sought.” (Emphasis mine.)

In the other case cited by the majority, Austin Road Co. v. Pope, 147 Texas 430, 216 S. W. (2d) 563, one negligent defendant was denied indemnity against his negligent codefendant, but his right of contribution was affirmed. In that case one of the defendants was negligent in failing to maintain a watchman at a place where loaded trucks of the other defendant were backed through a narrow passageway on a street where construction work was being carried on, and the driver of a truck was negligent in failing to keep a proper lookout, in operating *189his truck on the west lane of the west side of the street, and in failing to sound his horn as a warning. There each defendant committed independent acts of negligence of the same general nature as those committed by the defendants in the case before us. But we held that neither defendant was entitled to be indemnified by the other. To my mind, the facts of that case are stronger on the side of the party seeking indemnity than are those in the instant case on the side of Humble. In that opinion, in denying the right of indemnity, we said: “* * * the rule does not apply where the joint tort-feasors are not in pari delicto as to each other, as where the injury resulted from- a violation of the duty one owes the other.” (Emphasis mine.)

In 42 C. J. S., p. 604, sec. 27, subsec. a, the rule is stated as follows: “As a general rule one compelled to pay damages for the negligent or tortious act of another is not entitled to indemnity from the latter where both parties are joint tort-feasors or in pari delicto.” Many decisions from Texas and other jurisdictions are cited in the footnotes to sustain this rule.

Why Article 2212, relating to contribution, should be applied to facts of that case was summed up in the following language: “The act of neither was the sole proximate cause. Both tortfeasors were present on the scene, either in person or by representatives, and each participated in the wrong. Either one or both might have prevented the wrong. Neither did. Each owed the other the same due care, and each owed the duty to exercise ordinary care for the safety of the injured party. Both violated these duties. Consequently, each was guilty of the same quality of negligence toward the injured workman. Thus they stand in pari delicto with each other and must, under the statute, share equally the burdens arising from their wrongful conduct.”

Humble having accepted the car for service, the possession of the car, under the facts, passed into the hands of Humble as a bailee. Therefore, Humble was primarily responsible for the car while the car was in its custody and possession, and its liability with respect to the car is that of a bailee. 5 Tex. Jur. Supp., p. 251, sec. 13, p. 252, sec. 14; Simms v. Sullivan, 100 Or. 487, 198 Pac. 240, 15 A. L. R. 678, and authorities cited therein. Humble having accepted the car as bailee, it became primarily liable to third persons for any injuries which might be cáused by the car on account of Humble’s negligence while in its custody and control, and the length of time the car remained in the hands of Humble before it caused the injuries complained of does not alter the duty of Humble as bailee to Mrs. Love.

*190Mrs. Love had ceased to exercise control of the car, and had gone to the grocery store, and she was not present at the time the car rolled out of the station. The jury found Humble guilty of negligence on several issues, while they found Mrs. Love guilty of negligence on only one issue; and when considered in connection with the other issues found in favor of Mrs. Love, that finding of negligence on her part became negligible as compared with the findings of negligence against Humble. Consequently, it cannot be said that she was equally guilty as a tort-feasor with Humble, or that she and Humble were in pari delicto as to each other at that time, with reference to the car.

The findings of negligence on the part of Humble by the jury also show a finding of a breach of duty owed by Humble to Mrs. Love, under the facts of this case, and such findings certainly would not justify a judgment of contribution, much less a judgment of indemnity, in favor of Humble over and against Mrs. Love. On the contrary, the jury having found that Humble had breached' a duty it owed Mrs. Love, this justifies a judgment of indemnity in favor of Mrs. Love over and against Humble. Wheeler v. Glazer, supra; Austin Road Co. v. Pope, supra; 18 C. J. S., p. 16, sec. 11 b (1).

In 42 C. J. S., p. 596, sec. 21, relating to the rule authorizing a recovery of indemnity for another’s wrong, the general rule is stated as follows: “One compelled to pay damages on account of the negligent or tortious act of another has a right of action against the latter for indemnity.”

The findings of the jury unquestionably establish that Humble is primarily responsible for the negligence or wrongful act which caused the injuries, and if Mrs. Love is compelled to pay damages on account of the negligence of Humble, she has a right of action against Humble for indemnity. See 42 C. J. S., p. 600, sec. 23.

To permit Humble to recover against Mrs. Love, the findings of the jury would have to show that Mrs. Love was equally guilty with Humble, and that Humble was not guilty of breaching a duty it owed Mrs. Love with respect to the car. The findings of the jury show to the contrary, and this Court is not justified in disregarding the findings upon these issues. It follows, as was held by this Court in the two recent cases above cited, that the right of indemnity does not exist in favor of Humble against Mrs. Love, and it also follows from the findings of the jury that the right of indemnity does exist in favor of *191Mrs. Love against Humble. The judgment of the Court of Civil Appeals should be reversed, and the judgment of the trial court should be affirmed.

Associate Justice Taylor joins in this opinion.

Chief Justice Hickman agrees with it in large part, but regards the question, as between the defendants, as one of contribution, as held by the Court of Civil Appeals.

Opinion delivered June 15, 1949.

Rehearing overruled October 5, 1949.

This case is concerned with injuries received as the result of a fire on August 16,1962 at the service station operated by James F. Barone. The fire started at the rear of plaintiffs car where it was being filled with gasoline and was allegedly caused by the negligence of John Smilyk an employee of Barone. Plaintiffs brought suit against Smilyk, Barone and Sun Oil Company (Sun) which owned the service station.

Sun has moved for summary judgment as to it on the basis that Barone was an independent contractor and therefore the alleged negligence of his employee could not result in liability as to Sun. The plaintiffs contend instead that Barone was acting as Sun’s agent and that Sun may therefore be responsible for plaintiffs injuries.

Barone began operating this business in October of 1960 pursuant to a lease dated October 17, 1960. The station and all of its equipment, with the exception of a tire-stand and rack, certain advertising displays and miscellaneous hand tools, were owned by Sun. The lease was subject .to termination by either party upon thirty days’ written notice after the first six months and at the anniversary date thereafter. The rental was partially determined by the volume of gasoline purchased but there was also a minimum and a maximum monthly rental.

*555At the same time, Sun and Barone also entered into a dealer’s agreement under which Barone was to purchase petroleum products from Sun and Sun was to loan necessary equipment and advertising materials. Barone was required to maintain this equipment and to use it solely for Sun products. Barone was permitted under the agreement to sell competitive products but chose to do so only in a few minor areas As to Sun products, Barone was prohibited from selling .them except under the Sunoco label and from blending them with products not supplied by Sun.

Barone’s station had the usual large signs indicating that Sunoco products were sold there. His advertising in the classified section of the telephone book was under a Sunoco heading and his employees wore uniforms with the Sun emblem, the uniforms being owned by Barone or rented from an independent company.

Barone, upon the urging of Robert B. Peterson, Sun’s area sales representative, attended a Sun school for service station operators in 1961. The school’s curriculum was designed to familiarize the station operator with bookkeeping and merchandising, the appearance and proper maintenance of a Sun station, and the Sun Oil products. The course concluded with the operator working at Sun’s model station in order to gain work experience in the use of the policy and techniques taught at the school.

Other facts typifying the company-service station relationship were the weekly visits of Sun’s sales representative, Peterson, who would take orders for Sun products, inspect the restrooms, communicate customer complaints, make various suggestions to improve sales and discuss any problems that Barone might be having. Besides the weekly visits, Peterson was in contact with Barone on other occasions in order to implement Sun’s “competitive allowance system” which enabled Barone to meet local price competition by giving him a rebate on the gasoline in his inventory roughly equivalent to the price decline and a similarly reduced price on his next order of gasoline.

While Peterson did offer advice to Barone on all phases of his *556operation, it was usually done on request and Barone was under no obligation to follow the advice. Barone’s contacts and dealings with Sun were many and their relationship intricate, but he made no written reports to Sun and he alone assumed the overall risk of profit or loss in his business operation. Barone independently determined his own hours of operation and the identity, pay scale and working conditions of his employees, and it was his name that was posted as proprietor.

Plaintiffs contend in effect that the aforegoing facts indicate that Sun controlled the day-to-day operation of the station and consequently Sun is responsible for the negligent acts of Barone’s employee. Specifically, plaintiffs contend that there is an issue of fact for the jury to determine as to whether or not there was an agency relationship.

The legal relationships arising from the distribution systems of major oil-producing companies are in certain respects unique. As stated in an annotation collecting many of the cases dealing with this relationship:

“This distribution system has grown up primarily as the result of economic factors and with little relationship to traditional legal concepts in the field of master and servant, so that it is perhaps not surprising that attempts by the court to discuss the relationship in the standard terms have led to some difficulties and confusion.” 83 A.L.R. 2d 1282, 1284 (1962).

In some situations traditional definitions of principal and agent and of employer and independent contractor may be difficult to apply to service station operations, but the undisputed facts of the case at bar make it clear that Barone was an independent contractor.

Barone’s service station, unlike retail outlets for many products, is basically a one-company outlet and represents to the public, through Sunoco’s national and local advertising, that it sells not only Sun’s quality products but Sun’s quality service. Many people undoubtedly come to the service station because of that latter representation.

*557However, the lease contract and dealer’s agreement fail to establish any relationship other than landlord- tenant, and independent contractor. Nor is there anything in the conduct of the individuals which is inconsistent with that relationship so as to indicate that the contracts were mere subterfuge or sham. The areas of close contact between Sun and Barone stem from the fact that both have a mutual interest in the sale of Sun products and in the success of Barone’s business.

The cases cited by both plaintiffs and defendant indicate that the result varies according to the contracts involved and the conduct and evidence of control under those contracts. Both lines of cases indicate that the test to be applied is that of whether the oil company has retained the right to control the details of the day-to-day operation of the service station; control or influence over results alone being viewed as insufficient. Those cases cited by Sun are regarded as correctly stating the law. See Arkansas Fuel Oil Co. v. Scaletta, 200 Ark. 645, 140 S.W.2d 684 (1940); Cawthon v. Phillips Petroleum Co., 124 So.2d 517, 83 A.L.R. 2d 1276 (Dist. Ct. App. Fla., 1960); Cities Service Oil Co. v. Kindt, 200 Okl. 64, 190 P.2d 1007 (1948); Texas Co. v. Wheat, 140 Tex. 468, 168 S.W.2d 632 (1943). Those cases cited by plaintiffs to the extent that they are inconsistent with this view are not followed. It should be noted however that the same rule of law is applied in nearly all of the cases and that the differences in result are explained by different fact situations and greater evidence of oil company control. See Edwards v. Gulf Oil Corp., 69 Ga. App. 140, 13 S.E.2d 843 (1943), ibid., 71 Ga.App. 649, 31 S.E.2d 677 (1944); Brenner v. Socony Vacuum Oil Co., 236 Mo.App. 524, 158 S.W.2d 171 (1942); Texas Co. v. Freer, 151 S.W.2d 907 (Civ. App. Tex., 1941). For a conclusion that the degree of control over the method of operation is determinative, see 83 A.L.R.2d 1282, 1284 (1962).

The facts of this case differ markedly from those in which the oil company was held liable for the tortious conduct of its service station operator or his employees. Sun had no control over the retails of Barone’s day-to-day operation. Therefore, no liability can be imputed to Sun from the allegedly negligent acts of Smilyk. Sun’s motion for *558summary judgment is granted.

It is so ordered.

OPINION

PETERSON, Justice.

Plaintiffs, 86 individual, partnership or corporate farmers, brought this action *288against defendant Cargill, Inc. (Cargill) and defendant Warren Grain & Seed Co. (Warren) to recover losses sustained when Warren defaulted on the contracts made with plaintiffs for the sale of grain. After a trial by jury, judgment was entered in favor of plaintiffs, and Cargill brought this appeal. We affirm.

This case arose out of the financial collapse of defendant Warren Seed & Grain Co., and its failure to satisfy its indebtedness to plaintiffs. Warren, which was located in Warren, Minnesota, was operated by Lloyd Hill and his son, Gary Hill. Warren operated a grain elevator and as a result was involved in the purchase of cash or market grain from local farmers. The cash grain would be resold through the Minneapolis Grain Exchange or to the terminal grain companies directly. Warren also stored grain for farmers and sold chemicals, fertilizer and steel storage bins. In addition, it operated a seed business which involved buying seed grain from farmers, processing it and reselling it for seed to farmers and local elevators.

Lloyd Hill decided in 1964 to apply for financing from Cargill.1 Cargill’s officials from the Moorhead regional office investigated Warren’s operations and recommended that Cargill finance Warren.

Warren and Cargill thereafter entered into a security agreement which provided that Cargill would loan money for working capital to Warren on “open account” financing up to a stated limit, which was originally set as $175,000.2 Under this contract, Warren would receive funds and pay its expenses by issuing drafts drawn on Cargill through Minneapolis banks. The drafts were imprinted with both Warren’s and Cargill’s names. Proceeds from Warren’s sales would be deposited with Cargill and credited to its account. In return for this financing, Warren appointed Cargill as its grain agent for transaction with the Commodity Credit Corporation. Cargill was also given a right of first refusal to purchase market grain sold by Warren to the terminal market.

A new contract was negotiated in 1967, extending Warren’s credit line to $300,000 and incorporating the provisions of the original contract. It was also stated in the contract that Warren would provide Cargill with annual financial statements and that either Cargill would keep the books for Warren or an audit would be conducted by an independent firm. Cargill was given the right of access to Warren’s books for inspection.

In addition, the agreement provided that Warren was not to make capital improvements or repairs in excess of $5,000 without Cargill’s prior consent. Further, it was not to become liable as guarantor on another’s indebtedness, or encumber its assets except with Cargill’s permission. Consent by Car-gill was required before Warren would be allowed to declare a dividend or sell and purchase stock.

Officials from Cargill’s regional office made a brief visit to Warren shortly after the agreement was executed. They examined the annual statement and the accounts receivable, expenses, inventory, seed, machinery and other financial matters. Warren was informed that it would be reminded periodically to make the improvements recommended by Cargill.3 At approximately this time, a memo was given to the Cargill official in charge of the Warren account, *289Erhart Becker, which stated in part: “This organization [Warren] needs very strong paternal guidance.”

In 1970, Cargill contracted with Warren and other elevators to act as its agent to seek growers for a new type of wheat called Bounty 208. Warren, as Cargill’s agent for this project, entered into contracts for the growing of the wheat seed, with Cargill named as the contracting party. Farmers were paid directly by Cargill for the seed and all contracts were performed in full. In 1971, pursuant to an agency contract, Warren contracted on Cargill’s behalf with various farmers for the growing of sunflower seeds for Cargill. The arrangements were similar to those made in the Bounty 208 contracts, and all those contracts were also completed. Both these agreements were unrelated to the open account financing contract. In addition, Warren, as Car-gill’s agent in the sunflower seed business, cleaned and packaged the seed in Cargill bags.

During this period, Cargill continued to review Warren’s operations and expenses and recommend that certain actions should be taken.4 Warren purchased from Cargill various business forms printed by Cargill and received sample forms from Cargill which Warren used to develop its own business forms.

Cargill wrote to its regional office in 1970 expressing its concern that the pattern of increased use of funds allowed to develop at Warren was similar to that involved in two other cases in which Cargill experienced severe losses. Cargill did not refuse to hon- or drafts or call the loan, however. A new security agreement which increased the credit line to $750,000 was executed in 1972, and a subsequent agreement which raised the limit to $1,250,000 was entered into in 1976.

Warren was at that time shipping Cargill 90% of its cash grain. When Cargill’s facilities were full, Warren shipped its grain to other companies. Approximately 25% of Warren’s total sales was seed grain which was sold directly by Warren to its customers.

As Warren’s indebtedness continued to be in excess of its credit line, Cargill began to contact Warren daily regarding its financial affairs. Cargill headquarters informed its regional office in 1973 that, since Cargill money was being used, Warren should realize that Cargill had the right to make some critical decisions regarding the use of the funds. Cargill headquarters also told Warren that a regional manager would be working with Warren on a day-to-day basis as well as in monthly planning meetings. In 1975, Cargill’s regional office began to keep a daily debit position on Warren. A bank account was opened in Warren’s name on which Warren could draw checks in 1976. The account was to be funded by drafts drawn on Cargill by the local bank.

In early 1977, it became evident that Warren had serious financial problems. Several farmers, who had heard that Warren’s checks were not being paid, inquired or had their agents inquire at Cargill regarding Warren’s status and were initially told that there would be no problem with payment. In April 1977, an audit of Warren revealed that Warren was $4 million in debt. After Cargill was informed that Warren’s financial statements had been deliberately falsified, Warren’s request for additional financing was refused. In the final days of Warren’s operation, Cargill sent an official to supervise the elevator, including disbursement of funds and income generated by the elevator.

After Warren ceased operations, it was found to be indebted to Cargill in the amount of $3.6 million. Warren was also *290determined to be indebted to plaintiffs in the amount of $2 million, and plaintiffs brought this action in 1977 to seek recovery of that sum. Plaintiffs alleged that Cargill was jointly liable for Warren’s indebtedness as it had acted as principal for the grain elevator.5

The matter was bifurcated for trial in Marshall County District Court. In the first phase, the amount of damages sustained by each farmer was determined by the court. The second phase of the action, dealing with the issue of Cargill’s liability for the indebtedness of Warren, was tried before a jury.

The jury found that Cargill’s conduct between 1973 and 1977 had made it Warren’s principal.6 Warren was found to be the agent of Cargill with regard to contracts for:

1. The purchase and sale of grain for market.

2. The purchase and sale of seed grain.

3. The storage of grain.

The court determined that Cargill was the disclosed principal of Warren. It was concluded that Cargill was jointly liable with Warren for plaintiffs’ losses, and judgment was entered for plaintiffs.

Cargill seeks a reversal of the jury’s findings or, if the jury findings are upheld, a reversal of the trial court’s determination that Cargill was a disclosed principal. In the alternative, Cargill requests that the court order a new trial based upon the trial court’s error in (1) denying Cargill’s requested jury instructions; (2) refusing to admit relevant evidence; and (3) denying Cargill’s motion for change of venue. Northwestern County Elevator Association, North Dakota Grain Dealers Association and Northwestern National Bank of Minneapolis have all filed briefs on appeal as amici curiae, seeking to have the jury verdict reversed.

1. The major issue in this case is whether Cargill, by its course of dealing with Warren, became liable as a principal on contracts made by Warren with plaintiffs. Cargill contends that no agency relationship was established with Warren, notwithstanding its financing of Warren’s operation and its purchase of the majority of Warren’s grain. However, we conclude that Cargill, by its control and influence over Warren, became a principal with liability for the transactions entered into by its agent Warren.

Agency is the fiduciary relationship that results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act. Jurek v. Thompson, 308 Minn. 191, 241 N.W.2d 788 (1976); Lee v. Peoples Cooperative Sales Agency, 201 Minn. 266, 276 N.W. 214 (1937); Restatement (Second) of Agency § 1 (1958). In order to create an agency there must be an agreement, but not necessarily a contract between the parties. Restatement (Second) of Agency § 1, comment b (1958). An agreement may result in the creation of an agency relationship although the parties did not call it an agency and did not intend the legal consequences of the relation to follow. Id. The existence of the agency may be proved by circumstantial evidence which shows a course of dealing between the two parties. Rausch v. Aronson, 211 Minn. 272, 1 N.W.2d 371 (1941). When an agency relationship is to be proven by circumstantial evidence, the principal must be shown to have consented to the agency since one cannot be the agent of another except by consent of the latter. Larkin v. McCabe, 211 Minn. 11, 299 N.W. 649 (1941).

Cargill contends that the prerequisites of an agency relationship did not exist because Cargill never consented to the *291agency, Warren did not act on behalf of Cargill, and Cargill did not exercise control over Warren. We hold that all three elements of agency could be found in the particular circumstances of this case. By directing Warren to implement its recommendations, Cargill manifested its consent that Warren would be its agent. Warren acted on Cargill’s behalf in procuring grain for Cargill as the part of its normal operations which were totally financed by Car-gill.7 Further, an agency relationship was established by Cargill’s interference with the internal affairs of Warren, which constituted de facto control of the elevator.

A creditor who assumes control of his debtor’s business may become liable as principal for the acts of the debtor in connection with the business. Restatement (Second) of Agency § 14 0 (1958). It is noted in comment a to section 14 0 that:

A security holder who merely exercises a veto power over the business acts of his debtor by preventing purchases or sales above specified amounts does not thereby become a principal. However, if he takes over the management of the debtor’s business either in person or through an agent, and directs what contracts may or may not be made, he becomes a principal, liable as a principal for the obligations incurred thereafter in the normal course of business by the debtor who has now become his general agent. The point at which the creditor becomes a principal is that at which he assumes de facto control over the conduct of his debtor, whatever the terms of the formal contract with his debtor may be.

A number of factors indicate Cargill’s control over Warren, including the following:

(1) Cargill’s constant recommendations to Warren by telephone;

(2) Cargill’s right of first refusal on grain;

(3) Warren’s inability to enter into mortgages, to purchase stock or to pay dividends without Cargill’s approval;

(4) Cargill’s right of entry onto Warren’s premises to carry on periodic checks and audits;

(5) Cargill’s correspondence and criticism regarding Warren’s finances, officers salaries and inventory;

(6) Cargill’s determination that Warren needed “strong paternal guidance”;

(7) Provision of drafts and forms to Warren upon which Cargill’s name was imprinted;

(8) Financing of all Warren’s purchases of grain and operating expenses; and

(9) Cargill’s power to discontinue the financing of Warren’s operations.

We recognize that some of these elements, as Cargill contends, are found in an ordinary debtor-creditor relationship. However, these factors cannot be considered in isolation, but, rather, they must be viewed in light of all the circumstances surrounding Cargill’s aggressive financing of Warren.

It is also Cargill’s position that the relationship between Cargill and Warren was that of buyer-supplier rather than principal-agent. Restatement (Second) of Agency § 14K (1958) compares an agent with a supplier as follows:

One who contracts to acquire property from a third person and convey it to another is the agent of the other only if it is agreed that he is to act primarily for the benefit of the other and not for himself.

Factors indicating that one is a supplier, rather than an agent, are:

(1) That he is to receive a fixed price for the property irrespective of price paid by him. This is the most important. (2) That he acts in his own name and receives the title to the property which he thereafter is to transfer. (3) That he has *292an independent business in buying and selling similar property.

Restatement (Second) of Agency § 14K, comment a (1958).

Under the Restatement approach, it must be shown that the supplier has an independent business before it can be concluded that he is not an agent. The record establishes that all portions of Warren’s operation were financed by Cargill and that Warren sold almost all of its market grain to Cargill. Thus, the relationship which existed between the parties was not merely that of buyer and supplier.

A case analogous to the present one is Butler v. Bunge Corporation, 329 F.Supp. 47 (N.D.Miss.1971). In Butler, the plaintiff brought an action to recover the price of a soybean crop sold to an elevator that was operated by Bayles, a purported agent of the defendant Bunge Corporation. Bayles had agreed to operate a former Bunge elevator pursuant to an agreement in which Bayles was designated as manager. Although Bunge contended that Bayles was an independent contractor, the court determined that the elevator was an agent of Bunge.8

In this case, as in Butler, Cargill furnished substantially all funds received by the elevator. Cargill did have a right of entry on Warren’s premises, and it, like Bunge, required maintenance of insurance against hazards of operation. Warren’s activities, like Bayles’ operations, formed a substantial part of Cargill’s business that was developed in that area. In addition, Cargill did not think of Warren as an operator who was free to become Cargill’s competitor, but rather conceded that it believed that Warren owed a duty of loyalty to Cargill. The decisions made by Warren were not independent of Cargill’s interest or its control.

Further, we are not persuaded by the fact that Warren was not one of the “line” elevators that Cargill operated in its own name. The Warren operation, like the line elevator, was financially dependent on Car-gill’s continual infusion of capital. The arrangement with Warren presented a convenient alternative to the establishment of a line elevator. Cargill became, in essence, the owner of the operation without the accompanying legal indicia.

The amici curiae assert that, if the jury verdict is upheld, firms and banks which have provided business loans to county elevators will decline to make further loans. The decision in this case should give no cause for such concern. We deal here with a business enterprise markedly different from an ordinary bank financing, since Car-gill was an active participant in Warren’s operations rather than simply a financier. Cargill’s course of dealing with Warren was, by its own admission, a paternalistic relationship in which Cargill made the key *293economic decisions and kept Warren in existence.

Although considerable interest was paid by Warren on the loan, the reason for Car-gill’s'financing of Warren was not to make money as a lender but, rather, to establish a source of market grain for its business. As one Cargill manager noted, “We were staying in there because we wanted the grain.” For this reason, Cargill was willing to extend the credit line far beyond the amount originally allocated to Warren. It is noteworthy that Cargill was receiving significant amounts of grain and that, notwithstanding the risk that was recognized by Cargill, the operation was considered profitable.

On the whole, there was a unique fabric in the relationship between Cargill and Warren which varies from that found in normal debtor-creditor situations. We conclude that, on the facts of this case, there was sufficient evidence from which the jury could find that Cargill was the principal of Warren within the definitions of agency set forth in Restatement (Second) of Agency §§ 1 and 140.

2. Cargill argues that even if it were established that Cargill was Warren’s principal in regard to this transaction, Car-gill could only be an undisclosed principal because plaintiffs failed to establish that they had notice of a principal. See Restatement (Second) of Agency § 4 (1958). It asserts that, as an undisclosed principal, it should not be held liable on contracts made by its agent since it settled with the purported agent prior to notice of any third-party claims.

By consent of the parties, the trial court agreed to decide the issue regarding whether Cargill was an undisclosed or disclosed principal. Although the court noted that it could reasonably refuse to make the requested finding, it chose to rule that, as a matter of fact, Cargill was a disclosed principal.

From the facts in the record, it is unclear whether plaintiffs were on notice that Warren was acting on Cargill’s behalf. However, it is not necessary to decide whether Cargill was a disclosed or undisclosed principal. We believe that Cargill cannot avoid its liability to plaintiffs by payment to its agent even if it had operated as an undisclosed principal.

The question of whether payment in good faith to an agent relieves a principal of liability to a third party has not previously been decided in Minnesota. Although there is little recent authority, a majority of jurisdictions recognize the English or older rule that payment by an undisclosed principal without notice is a good defense to any claim asserted by a third party.9 See Shasta Livestock Auction Yard, Inc. v. Bill Evans Cattle Management Corp., 375 F.Supp. 1027 (D. Idaho 1974). The modern view, which has been adopted by a minority of states, is expressed in Restatement (Second) of Agency § 208 (1958), which provides:

An undisclosed principal is not discharged from liability to the other party to a transaction conducted by an agent by payment to, or settlement of accounts with, the agent, unless he does so in reasonable reliance upon conduct of the other party which is not induced by the agent’s misrepresentations and which indicates that the agent has settled the account.

See Poretta v. Superior Dowel Company, 153 Me. 308, 137 A.2d 361 (1958).

We now adopt the modern position set forth in the Restatement rule. We believe that this rule is the better principle to be *294followed since the undisclosed principal is aware that he will become liable under the original transaction, and he should not be able to escape his liability by payment to the agent. Seavey, Undisclosed Principal; Unsettled Problems, 1 Howard L.J. 79, 84 (1955). As one commentator observed:

[T]he [modern] rule of Park, B., seems on the whole to be reasonable and just. If the principal sends an agent to buy goods for him and on his account, it is not unreasonable that he should see that they are paid for. Although the seller may consider the agent to be the principal, the actual principal knows better. He can easily protect himself by insisting upon evidence that the goods have been paid for or that the seller with full knowledge of the facts has elected to rely upon the responsibility of the agent, and if he does not, but, except where misled by some action of the seller, voluntarily pays to the agent without knowing that he has paid the seller, there is no hardship in requiring him to pay again.

2 F. Mechem, A Treatise on the Law of Agency § 1749 (1914).

Since plaintiffs did not indicate to Cargill that Warren had settled their accounts, Cargill, as principal, is not discharged from liability to plaintiffs by payment to Warren.

3. It is also Cargill’s position that the trial court erred in failing to submit certain requested jury instructions.

Cargill claims, first, that Restatement (Second) of Agency § 1 should have been given instead of 4 Minn. Dist. Judges Ass’n, Minnesota Practice, JIG II, § 250 (2d ed. 1974) as the latter instruction specifically states that it is to be used for tort cases only and that it must be modified before it can be used in contract cases. The essence of Restatement (Second) of Agency § 1 (1958) and JIG, § 250 are the same. In fact, since the latter provision requires actual physical control as an element, it was favorable rather than harmful to Cargill. See Jurek v. Thompson, 308 Minn, at 199 n.4, 241 N.W.2d at 792 n.4. Consequently, Car-gill’s contention on this issue is without merit.

Cargill asserts, second, that the trial court erred in refusing to instruct on the issue that agency to perform a particular act cannot be inferred by the existence of agency relationship at another time and in a different capacity. Cargill is concerned that the testimony regarding the agency relationship in the sunflower and Bounty 208 program between Cargill and Warren created an inference that this relationship extended to other aspects of Warren’s operations. The court, however, is not required to instruct against every improper inference that a jury could draw. Also, it was pointed out by Cargill’s counsel in closing argument that the Bounty 208 contracts were completed in 1970-1971, and the relevant time period for the agency in this case was stated by the court as 1973 to 1977. Thus, the failure to give the requested instruction was not reversible error.

Cargill’s third contention is that the trial court erred in not submitting to the jury an instruction, in the form of Restatement (Second) of Agency § 14K and comment a to that section, which would serve to focus on some, but not all, of the applicable factors. The instruction could have confused the jury since Cargill asserted only a buyer-supplier relationship to the part of Warren’s operation involving purchase and resale of market grain. The court’s instruction on general agency law was adequate to inform the jury of the applicable principle of law. This is especially true in light of the fact that there are no recent Minnesota cases which interpret section 14K or apply it to situations similar to those in the instant case. Thus, the court gave a proper instruction in accordance with the controlling case law.

4. Cargill asserts that it was error for the trial court to exclude evidence that Warren had been sued in prior years by farmers for breach of contract, and Warren had neither asked Cargill to defend these suits nor notified Cargill that these suits had been brought. One customer who had previously brought an action against Warren was A. Gay Jenson, a plaintiff in this case.

*295The trial court properly determined that the particular transaction involved had no probative evidentiary value on the issues involved in this case. Any relevance, which would have required detailed evidence to find similarity between cases so as to create an inference useable in the present case, was outweighed by the likelihood of confusion of the jury. As the trial court noted, evidence would have been submitted on lawsuits concerning contracts which were not involved in this case. It could be concluded, therefore, that the court did not err in excluding this collateral evidence.

5. Finally, Cargill claims that the trial court’s denial of its motion for a change of venue was improper. Cargill moved for a change of venue pursuant to Minn.Stat. § 542.11 (1980), because it was not satisfied with the impartiality of the jury. Section 542.11 permits the trial court to exercise its discretion in determining when a change of venue is appropriate.

Minnesota District Court Rule 29 states:

A change of venue shall not be granted under the provisions of section 542.11, unless the party applying therefor uses due diligence to procure the same within a reasonable time after issue has been joined in the action and the ground for the change has come to the knowledge of the applicant. Nor shall a change be granted where the other party will lose the benefit of a term, unless the party asking for such change shall move therefor at the earliest reasonable opportunity after issue has been joined and he has information of the ground of such change.

Cargill’s motion was made during the jury selection process. On group examination, 26 of the 60 veniremen were excused for cause, either because of relationship to the parties or because of prejudice. Of the 14 jurors who were seated, 2 were excused for cause. Several of the jurors said that they had information concerning the case. The trial court noted that all 14 jurors, including the 2 excused for cause, said that they would lay aside their impressions and opinions and. render a fair and impartial decision.

The mere fact that the jury had knowledge of the financial collapse of Warren and its connection with Cargill does not indicate that it could not render a fair decision.10 Further, Cargill had 13 months from the filing of the lawsuit to commencement of the trial to ascertain that Warren was a small community and that jurors from that area could be presumed to have some association with the elevator or with one of the 86 plaintiffs. Also, Cargill’s counsel, as well as plaintiffs’ counsel, referred to the economic impact of the decision on the community. Thus, the trial court’s denial of a change of venue was a proper exercise of discretion.

Affirmed.

SIMONETT, J., took no part in the consideration or decision of this case.

Knutson, Justice.

Plaintiff desired to make a business investment. He engaged defendant as his agent to investigate and negotiate for the purchase of a route of coin-operated music machines. On June 2, 1947, relying upon the advice of defendant and the investigation he had made, plaintiff purchased such a business from Phillip Loechler and Lyle Mayer of Rochester, Minnesota, who will be referred to hereinafter as the sellers. The business was located at La Crosse, Wisconsin, and throughout the surrounding territory. Plaintiff alleges that defendant represented to him that he had made a thorough investigation of the route; that it had 75 locations in operation; that one or more machines were at each location; that the equipment at each location was not more than six months old; and that the gross income from all locations amounted to more than $3,000 per month. *35As a matter of fact, defendant had made only a superficial investigation and had investigated only five of the locations. Other than that, he had adopted false representations of the sellers as to the other locations and had passed them on to plaintiff as his own. Plaintiff was to pay $30,620 for the business. He paid $11,000 down. About six weeks after the purchase, plaintiff discovered that the representations made to him by defendant were false, in that there were not more than 47 locations; that at some of the locations there were no machines and at others there were machines more than six months old, some of them being seven years old; and that the gross income was far less than $3,000 per month. Upon discovering the falsity of defendant’s representations and those of the sellers, plaintiff rescinded the sale. He offered to return what he had received, and he demanded the return of his money. The sellers refused to comply, and he brought suit against them in the district court of Olmsted county. The action was tried, resulting in a verdict of $10,000 for plaintiff. Thereafter, the sellers paid plaintiff $9,500, after which the action was dismissed with prejudice pursuant to a stipulation of the parties.

In this action, brought in Hennepin county, plaintiff alleges that defendant, while acting as agent for him, collected a secret commission from the sellers for consummating the sale, which plaintiff seeks to recover under his first cause of action. In his second cause of action, he seeks to recover damages for (1) losses suffered in operating the route prior to rescission; (2) loss of time devoted to operation; (3) expenses in connection with rescission of the sale and his investigation in connection therewith; (4) nontaxable expenses in connection with prosecution of the suit against the sellers; and (5) attorneys’ fees in connection with the suit. The case was tried to a jury, and plaintiff recovered a verdict of $5,200. This appeal is from the judgment entered pursuant thereto.

Defendant contends that after recovery of a verdict by plaintiff in his action for rescission against the sellers he cannot maintain this action against defendant. Principally, defendant argues that recovery in the action against the sellers is a bar to this action for *36the following reasons: (1) That plaintiff has elected one of alternative remedies and cannot thereafter pursue another; (2) that successful pursuit of one remedy constitutes a bar to another remedy for the same wrong, even though the outcome of the first action did not make plaintiff whole in point of actual loss; (3) that the satisfied verdict in the rescission case is a bar; and (4) that defendant and the sellers were joint tortfeasors, and the discharge of one discharged them all.

With respect to plaintiff’s first cause of action, the principle that all profits made by an agent in the course of an agency belong to the principal, whether they are the fruits of performance or the violation of an agent’s duty, is firmly established and universally-recognized. Smitz v. Leopold, 51 Minn. 455, 53 N. W. 719; Crump v. Ingersoll, 44 Minn. 84, 46 N. W. 141; Kingsley v. Wheeler, 95 Minn. 360, 104 N. W. 543; Goodhue Farmers’ Warehouse Co. v. Davis, 81 Minn. 210, 83 N. W. 531; Snell v. Goodlander, 90 Minn. 533, 97 N. W. 421; City of Minneapolis v. Canterbury, 122 Minn. 301, 142 N. W. 812, 48 L.R.A.(N.S.) 842; Doyen v. Bauer, 211 Minn. 140, 300 N. W. 451; Magee v. Odden, 220 Minn. 498, 20 N. W. (2d) 87.

It matters not that the principal has suffered no damage or even that the transaction has been profitable to him. Raymond Farmers Elev. Co. v. American Surety Co. 207 Minn. 117, 290 N. W. 231, 126 A. L. R. 1351.

The rule and the basis therefor are well stated in Lum v. McEwen, 56 Minn. 278, 282, 57 N. W. 662, where, speaking through Mr. Justice Mitchell, we said:

“Actual injury is not the principle the law proceeds on, in holding such transactions void. Fidelity in the agent is what is aimed at, and, as a means of securing it, the law will not permit him to place himself in a position in which he may be tempted by his own private interests to disregard those of his principal. * * * It is not material that no actual injury to the company [principal] resulted, or that the policy recommended may have been for its best interest. *37Courts will not inquire into these matters. It is enough to know that the agent in fact placed himself in such relations that he might be tempted by his own interests to disregard those of his principal.

“The transaction was nothing more or less than the acceptance by the agent of a bribe to perform his duties in the manner desired by the person who gave the bribe. Such a contract is void.

“This doctrine rests on such plain principles of law, as well as common business honesty, that the citation of authorities is unnecessary.”

The right to recover profits made by the agent in the course of the agency is not affected by the fact that the principal, upon discovering a fraud, has rescinded the contract and recovered that with which he parted. Restatement, Agency, § 407(2). Comment e on Subsection (2) reads:

“If an agent has violated a duty of loyalty to the principal so that the principal is entitled to profits which the agent has thereby made, the fact that the principal has brought an action against a third person and has been made whole by such action does not prevent the principal from recovering from the agent the profits which the agent has made. Thus, if the other contracting party has given a bribe to the agent to make a contract with him on behalf of the principal, the principal can rescind the transaction, recovering from the other party anything received by him, or he can maintain an action for damages against him; in either event the principal may recover from the agent the amount of the bribe.”

It follows that, insofar as the secret commission of $2,000 received by the agent is concerned, plaintiff had an absolute right thereto, irrespective of any recovery resulting from the action against the sellers for rescission.

Plaintiff’s second cause of action is brought to recover damages for (1) losses suffered in the operation of the business prior to rescission; (2) loss of time devoted to operation; (3) expenses in connection with rescission of the sale and investigation therewith; (4) nontaxable expenses in connection with the prosecution of the *38suit against the sellers; and (5) attorneys’ fees in connection with the suit.

The case comes to us on a bill of exceptions. No part of the testimony of the witnesses is included, so we must assume that the evidence establishes the items of damage claimed by plaintiff. Our inquiry is limited to a consideration of the question whether a principal may recover of an agent who has breached his trust the items of damage mentioned after a successful prosecution of an action for rescission against the third parties with whom the agent dealt for his principal.

The general rule is stated in Restatement, Agency, § 407(1), as follows:

“If an agent has received a benefit as a result of violating his duty of loyalty, the principal is entitled to recover from him what he has so received, its value, or its proceeds, and also the amount of damage thereby caused, except that if the violation consists of the wrongful disposal of the principal’s property, the principal cannot recover its value and also what the agent received in exchange therefor.”

In Comment a on Subsection (1) we find the following:

“* * * In either event, whether or not the principal elects to get back the thing improperly dealt with or to recover from the agent its value or the amount of benefit which the agent has improperly received, he is, in addition, entitled to be indemnified by the agent for any loss which has been caused to his interests by the improper transaction. Thus, if the purchasing agent for a restaurant purchases with the principal’s money defective food, receiving a bonus therefor, and the use of the food in the restaurant damages the business, the principal can recover from the agent the amount of money improperly expended by him, the bonus which the agent received, and the amount which will compensate for the injury to the business.”

The general rule with respect to damages for a tortious act is that—

*39“The wrong-doer is answerable for all the injurious consequences of his tortious act which, according to the usual course of events and general experience, were likely to ensue and which, therefore, when the act was committed, he may reasonably be supposed to have foreseen and anticipated.” 1 Sutherland, Damages (4 ed.) § 45, quoted with approval in Sargent v. Mason, 101 Minn. 319, 323, 112 N. W. 255, 257.

The general rule is given in Eestatement, Torts, § 910, as follows:

“A person, injured by the tort of another is entitled to recover damages from him for all harm, past, present and prospective, legally caused by the tort.”

Bergquist v. Kreidler, 158 Minn. 127, 196 N. W. 964, involved an action to recover attorneys’ fees expended by plaintiffs in an action seeking to enforce and protect their right to the possession of real estate. Defendant, acting as the owner’s agent, had falsely represented to plaintiffs that they could have possession on August 1, 1920. It developed after plaintiffs had purchased the premises that a tenant had a lease running to August 1, 1922, on a rental much lower than the actual value of the premises. Defendant (the agent) conceded that plaintiffs were entitled to recover the loss in rent, but contended that attorneys’ fees and disbursements expended by plaintiffs in testing the validity of the tenant’s lease were not recoverable. In affirming plaintiffs’ right to recover we said (158 Minn. 132, 196 N. W. 966):

“* * * the litigation in which plaintiffs became involved was the direct, legitimate and a to-be-expected result of appellant’s misrepresentation. The loss sustained by plaintiffs in conducting that litigation ‘is plainly traceable’ to appellant’s wrong and he should make compensation accordingly.”

So far as the right to recover attorneys’ fees is concerned, the same may be said in this case. Plaintiff sought to return what had been received and demanded a return of his down payment. The sellers refused. He thereupon sued to accomplish this purpose, *40as he had a right to do, and was successful. His attorneys’ fees and expenses of suit were directly traceable to the harm caused by defendant’s wrongful act. As such, they are recoverable.

The Bergquist case is distinguished in the later case of Stickney v. Goward, 161 Minn. 457, 201 N. W. 630, 39 A. L. R. 1216, where we held that attorneys’ fees might not be recovered in a separate suit against the same parties that were involved in a prior suit. That situation does not prevail here. In this case, defendant was not a party to the suit against the sellers. As in the Bergquist case, the attorneys’ fees and expenses of litigation against the sellers became necessary because of defendant’s tortious conduct. The general rule applicable here is stated in 15 Am. Jur., Damages, § 144, as follows:

“It is generally held that where the wrongful act of the defendant has involved the plaintiff in litigation with others or placed him in such relation with others as makes it necessary to incur expense to protect his interest, such costs and expenses, including attorneys’ fees, should be treated as the legal consequences of the original wrongful act and may be recovered as damages.”

The same is true of the other elements of damage involved. See, generally, 15 Am. Jur., Damages, § 138.

Defendant contends that plaintiff had an election of remedies and, having elected to proceed against the sellers to recover what he had paid, is now barred from proceeding against defendant. It is true that upon discovery of the fraud plaintiff had an election of remedies against the sellers. It is not true, however, that, having elected to sue for recovery of that with which he had parted, he is barred from proceeding against his agent to recover damages for his tortious conduct. While some of the allegations in plaintiff’s complaint against the sellers are similar to or identical with those in his complaint in this case, insofar as the fraud is concerned, the right of recovery here against the agent goes much further than the action against the sellers. Many of the elements *41of damage against the agent are not available to plaintiff against the sellers. For instance, he has no right to recover attorneys’ fees and expenses of the litigation against the sellers. He has that right against the agent. Plaintiff may recover profits made by the agent, irrespective of his recovery against the sellers. Losses directly flowing from the agent’s tortious conduct are not recoverable against the sellers in an action for rescission, but they may be recovered against the agent, whose breach of faith has caused such losses.

Nor is the settlement and dismissal of the action against the sellers a bar to an action against the agent, for the same reasons as stated above. The sellers and agent are not joint tortfeasors in the sense that their wrongful conduct necessarily grows out of the same wrong. Their individual torts may have been based on the same fraud, but their liabilities to plaintiff do not have the same limitations. In simple terms, the causes of action are not the same.

Defendant relies principally upon Martin v. Setter, 184 Minn. 457, 239 N. W. 219, 80 A. L. R. 471. In that case, plaintiffs and defendant contracted to exchange land. One Eieger acted as agent for defendant in the transaction. In a suit to recover for a default, defendant interposed a counterclaim for damages alleged to have resulted from fraudulent representations as to the value of the land which defendant received in the trade. It developed that defendant had instituted an action against his agent, Eieger, to recover damages for the identical misrepresentations plaintiffs were charged with, and that defendant had made a settlement with Eieger and had dismissed his action against Eieger with prejudice. We held that Eieger and plaintiffs were joint tortfeasors; that the action asserted against Eieger and the one against plaintiffs were one and the same; consequently, that a release of Eieger released plaintiffs.

The case is readily distinguishable from the instant case. The Martin case was not one for rescission. There, defendant’s counterclaim sought to recover his damages, he retaining what he had *42received. He had previously settled an action brought against his agent to recover the same damages. In the case now before us, the two actions, though based on the same fraud, are not the same, as we have pointed out above. The Martin case is not authority for the proposition for which defendant now contends. Settlement of the action for rescission against the sellers is not a bar to an action against the agent to recover those elements of damages not involved in the action for rescission brought against the sellers.

Affirmed.

Affirmed in part and reversed in part by published opinion. Judge NIEMEYER wrote a separate opinion, concurring in part and dissenting in part.

OPINION

MICHAEL, Circuit Judge:

Two ABC television reporters, after using false resumes to get jobs at Food Lion, Inc. supermarkets, secretly videotaped what appeared to be unwholesome food handling practices. Some of the video footage was used by ABC in a PrimeTime Live broadcast that was sharply critical of Food Lion. The grocery chain sued Capital Cities/ABC, Inc., American Broadcasting Companies, Inc., Richard Kaplan and Ira Rosen, producers of PrimeTime Live, and Lynne Dale and Susan Barnett, two reporters for the program (collectively, “ABC” or the “ABC defendants”). Food Lion did not sue for defamation, but focused on how ABC gathered its information through claims for fraud, breach of duty of loyalty, trespass, and unfair trade practices. Food Lion won at trial, and judgment for compensatory damages of $1,402 was entered on the various claims. Following a substantial (over $5 million) remittitur, the judgment provided for $315,000 in punitive damages. The ABC defendants appeal the district court’s denial of their motion for judgment as a matter of law, and Food Lion appeals the court’s ruling that prevented it from proving publication damages. Having considered the case, we (1) reverse the judgment that the ABC defendants committed fraud and unfair trade practices, (2) affirm the judgment that Dale and Barnett breached their duty of loyalty and committed a trespass, and (3) affirm, on First Amendment grounds, the district court’s refusal to allow Food Lion to prove publication damages.

I.

In early 1992 producers of ABC’s PrimeTime Live program received a report alleging that Food Lion stores were engaging in unsanitary meat-handling practices. The allegations were that Food Lion employees ground out-of-date beef together with new beef, bleached rank meat to remove its odor, and re-dated (and offered for sale) products not sold before their printed expiration date. The producers recognized that these allegations presented the potential for a powerful news story, and they decided to conduct an undercover investigation of Food Lion. ABC reporters Lynne Dale (Lynne Litt at the time) and Susan Barnett concluded that they would have a better chance of investigating the allegations if they could become Food Lion employees. With the approval of their superiors, they proceeded to apply for jobs with the grocery chain, submitting applications with false identities and references and fictitious local addresses. Notably, the applications failed to mention the reporters’ concurrent employment with ABC and otherwise misrepresented then* educational and employment experiences. Based on these applications, a South Carolina Food Lion store hired Barnett as a deli clerk in April 1992, and a North Carolina Food Lion store hired Dale as a meat wrapper trainee in May 1992.

Barnett worked for Food Lion for two weeks, and Dale for only one week. As they went about their assigned tasks for Food Lion, Dale and Barnett used tiny cameras (“lipstick” cameras, for example) and microphones concealed on their bodies to secretly record Food Lion employees treating, wrapping and labeling meat, cleaning machinery, and discussing the practices of the meat department. They gathered footage from the meat cutting room, the deli counter, the employee break *511room, and a manager’s office. .All told, in their three collective weeks as Food Lion employees, Dale and Barnett recorded approximately 45 hours of concealed camera footage.

Some of the videotape was eventually used in a November 5, .1992, broadcast of PrimeTime Live. ABC contends the footage confirmed many of the allegations initially leveled against Food Lion. The broadcast included, for example, videotape that appeared to show Food Lion employees repackaging and redating fish that had passed the expiration date, grinding expired beef with fresh beef, and applying barbeque sauce to chicken past its expiration date in order to mask the smell and sell it as fresh in the gourmet food section. The program included statements by former Food Lion employees alleging even more serious mishandling of meat at Food Lion stores across several states. The truth of the PrimeTime Live broadcast was not an issue in the litigation we now describe.

Food Lion sued ABC and the Prime-Time Live producers and reporters. Food Lion’s suit focused not on the broadcast, as a defamation suit would, but on the methods ABC used to obtain the video footage. The grocery chain asserted claims of fraud, breach of the duty of loyalty, trespass, and unfair trade practices, seeking millions in compensatory damages. Specifically, Food Lion sought to recover (1) administrative costs and wages paid in connection with the employment of Dale and Barnett and (2) broadcast (publication) damages for matters such as loss of good will, lost sales and profits, and diminished stock value. Punitive damages were also requested by Food Lion.

The district court, in a remarkably efficient effort, tried the case with a jury in three phases. At the liability phase, the jury found all of the ABC defendants liable to Food Lion for fraud and two of them, Dale and Barnett, additionally liable for breach of the duty of loyalty and trespass. Based on the jury’s fraud verdict and its special interrogatory findings that the ABC defendants had engaged in deceptive acts, the district court determined that the ABC defendants had violated the North Carolina Unfair and Deceptive Trade Practices Act (UTPA). Prior to the compensatory damages phase, the district court ruled that damages allegedly incurred by Food Lion as a result of ABC’s broadcast of PrimeTime Live — “lost profits, lost sales, diminished stock value or anything of that nature” — could not be recovered because these damages were not proximately caused by the acts (fraud, trespass, etc.) attributed to the ABC defendants in this case. See Food Lion, Inc. v. Capital Cities/ABC, Inc., 964 F.Supp. 956, 958 (M.D.N.C.1997) (setting forth rationale for ruling at trial). Operating within this constraint, the jury in the second phase awarded Food Lion $1,400 in compensatory damages on its fraud claim, $1.00 each on its duty of loyalty and trespass claims, and $1,500 on its UTPA claim. (The court required Food Lion to make an election between the fraud and UTPA damages, and the grocery chain elected to take the $1,400 in fraud damages.) At the final stage the jury lowered the boom, and awarded $5,545,750 in punitive damages on the fraud claim against ABC and its two producers, Kaplan and Rosen. The jury refused to award punitive damages against the reporters, Dale and Barnett. In post-trial proceedings the district court ruled that the punitive damages award was excessive, and Food Lion accepted a remitti-tur to a total of $315,000.

After trial the ABC defendants moved for judgment as a .'matter of law on all claims, the motion was denied, and the defendants now appeal. Food Lion cross-appeals, contesting the district court’s ruling that the damages the grocery chain sought as a result of the PrimeTime Live broadcast were not recoverable in this action. We now turn to the legal issues.

II.

A.

We must first consider whether the ABC defendants can be held liable for *512fraud, breach of the duty of loyalty, and trespass as a matter of North Carolina and South Carolina law and whether the North Carolina UTPA applies. As a federal court sitting in diversity, we are obliged to interpret and apply the substantive law of each state. See Erie R.R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). This process is more complicated here because neither state’s highest court has applied its law to circumstances exactly like those presented in this case. Thus, we must offer our best judgment about what we believe those courts would do if faced with Food Lion’s claims today. See Hatfield v. Palles, 537 F.2d 1245, 1248 (4th Cir.1976) (noting that when “[tjhere have been no decisions by the South Carolina Supreme Court ... [a] federal court must ... endeavor to decide the issue in the way it believes the South Carolina Supreme Court would decide it.”). In conducting our analysis, we may of course consider all of the authority that the state high courts would, and we should give appropriate weight to the opinions of their intermediate appellate courts. Commissioner v. Estate of Bosch, 387 U.S. 456, 465, 87 S.Ct. 1776, 18 L.Ed.2d 886 (1967) (noting that when there is no decision by a state’s highest court, federal court must apply what it “find[sj to be the state law after giving 'proper regard’ to relevant rulings of other courts of the State.”); Sanderson v. Rice, 777 F.2d 902, 905 (4th Cir.1985) (noting that “[ajn opinion of an intermediate appellate court is persuasive in situations where the highest state court has not spoken”). Finally, we review de novo the district court’s determinations on these questions of state law. Salve Regina College v. Russell, 499 U.S. 225, 231, 111 S.Ct. 1217, 113 L.Ed.2d 190 (1991).

1.

Food Lion, proceeding under the proof limitations on damages, sought $2,432.35 in compensatory damages on its fraud claim and the jury awarded $1,400. According to ABC, the district court erred in upholding the verdict on this claim because Food Lion did not prove injury caused by reasonable reliance on the misrepresentations made by Dale and Barnett on their job applications. We agree.

To prove fraud under North Carolina law, the plaintiff must establish that the defendant (1) made a false representation of material fact, (2) knew it was false (or made it with reckless disregard of its truth or falsity), and (3) intended that the plaintiff rely upon it. In addition, (4) the plaintiff must be injured by reasonably relying on the false representation. See Ragsdale v. Kennedy, 286 N.C. 130, 209 S.E.2d 494, 500 (N.C.1974); Britt v. Britt, 320 N.C. 573, 359 S.E.2d 467, 471 (N.C.1987), criticized on other grounds, Myers & Chapman, Inc. v. Thomas G. Evans, Inc., 323 N.C. 559, 374 S.E.2d 385, 391-92 (N.C.1988). The elements of fraud in South Carolina are essentially the same. See Florentine Corp., Inc. v. PEDA I, Inc., 287 S.C. 382, 339 S.E.2d 112, 113-114 (S.C.1985). It is undisputed that Dale and Barnett knowingly made misrepresentations with the aim that Food Lion rely on them. Thus, only the fourth element of fraud, injurious reliance, is at issue. Food Lion claimed two categories of injury resulting from the lies on the job applications: the costs associated with hiring and training new employees (administrative costs) and the wages it paid to Dale and Barnett.

The main component of Food Lion’s claim for fraud damages relates to administrative costs resulting from its employment of Dale and Barnett. These are routine costs associated with any new employee, including the costs of screening applications, interviewing, completing forms, and entering data into the payroll system. Also included are estimated costs attributable to trainees for lower productivity and customer dissatisfaction. Food Lion offered testimony that these costs totaled $1,944.62. It is undisputed that the jobs held by Dale and Barnett, meat wrapper trainee and deli clerk, were ones with high turnover. Still, Food Lion *513claims that because of the reporters’ misrepresentations on their employment applications, it was forced to “incur these [administrative] costs for two more employees,” Appellee’s Opening Br. at 15, because the reporters quit their jobs after one or two weeks.

As indicated, under North and South Carolina law a plaintiff claiming fraud must show injury proximately caused by its reasonable reliance on a misrepresentation. See Britt, 359 S.E.2d at 471 (requiring that plaintiff be “injured by reasonably relying on the false representation.”); Florentine Corp., 339 S.E.2d at 114 (same). In this case, therefore, Food Lion had to show (1) that it hired Dale and Barnett (and incurred the administrative costs incident to their employment) because it believed they would work longer than a week or two and (2) that in forming this belief it reasonably relied on misrepresentations made by Dale and Barnett.

On their job applications Dale and Barnett did misrepresent matters such as them backgrounds, experience, and other employment. They did not, however, make any representations about how long they would work, and Food Lion did not ask for any. To the contrary, the applications signed by Dale and Barnett expressly provided that either side — company or employee — could terminate the employment at any time. Each application contained the same provision, written in no uncertain terms: “I also understand and agree that if employed, employment is for an indefinite period of time, and that I have the right to terminate my employment at any time for any reason, as does the Company.” Food Lion also understood what this meant. As one of its payroll managers acknowledged on cross-examination, “when Food Lion hires a new deli clerk or a new meat clerk ... it assume[s] the risk that that person might stay only a few days.” Dale and Barnett were, in short, at-will employees.

Because Dale and Barnett did not make any express representations about how long they would work, Food Lion is left to contend that misrepresentations in the employment applications led it to believe the two would work for some extended period. There is a fundamental problem with that contention, however. North and South Carolina are at-will employment states, and under the at-will doctrine it is unreasonable for either the employer or the employee to rely on any assumptions about the duration of employment. At-will employment means that (absent an express agreement) employers are free to discharge employees at any time for any reason, and employees are free to quit. See Kurtzman v. Applied Analytical Indus., Inc., 347 N.C. 329, 493 S.E.2d 420, 422 (N.C.1997) (“in the absence of a contractual agreement between an employer and an employee establishing a definite term of employment, the relationship is presumed to be terminable at the will of either party without regard to the quality of performance of either party”); Small v. Springs Indus., Inc., 300 S.C. 481, 388 S.E.2d 808, 810 (S.C.1990) (“An individual working for an employer under a contract of employment for an indefinite period can be terminated at will. At-will employment is generally terminable by either party at any time, for any reason or for no reason at all.”) (citations omitted).

Food Lion’s claim for administrative costs attributable to Dale and Barnett is simply inconsistent with the at-will employment doctrine. Under that doctrine Food Lion could not reasonably rely on the sort of misrepresentations (about background, experience, etc.) made by the reporters to conclude that they would work for any extended period. As a result, Food Lion did not show that the administrative costs were an injury caused by reasonable reliance on the misrepresentations.

Food Lion also sought to recover the full amount ($487.73) of the wages it paid to Dale and Barnett, arguing that it *514was fraudulently induced to pay the wages because of the misrepresentations on the reporters’ employment applications. The last (proximate cause) element of fraud is again the only one at issue: Food Lion had to show that it paid the wages in reasonable reliance on the misrepresentations.

Food Lion relies on the jury’s findings on a separate claim, the finding that Dale and Barnett breached their duty of loyalty to Food Lion, to argue that it proved fraud damages for the wages it paid. Specifically, Food Lion says that “it is apparent[from the disloyalty verdict] that the jury found Food Lion did not receive adequate services for the wages it paid Dale and Barnett.” Appellee’s Opening Br. at 14. However, proof of the breach of duty of loyalty, for which the jury awarded nominal damages of $1.00, does not equal proof of fraud damages for inadequate services. That is because it is possible to perform the assigned tasks of a job adequately and still breach the duty of loyalty. For fraud damages Food Lion still had to prove reliance on the misrepresentations.

The question is what was the proximate cause of the issuance of paychecks to Dale and Barnett. Was it the resume misrepresentations or was it something else? It was something else. Dale and Barnett were paid because they showed up for work and performed their assigned tasks as Food Lion employees. Their performance was at a level suitable to their status as new, entry-level employees. Indeed, shortly before Dale quit, her supervisor said she would “make a good meat wrapper.” And, when Barnett quit, her supervisor recommended that she be rehired if she sought reemployment with Food Lion in the future. In sum, Dale and Barnett were not paid then* wages because of misrepresentations on their job applications. Food Lion therefore cannot assert wage payment to satisfy the injurious reliance element of fraud.1 The fraud verdict must be reversed.2

*5152.

ABC argues that Dale and Barnett cannot be held liable for a breach of duty of loyalty to Food Lion under existing tort law in North and South Carolina. It is undisputed that both reporters, on behalf of ABC, wore hidden cameras to make a video and audio record of what they saw and heard while they were employed by Food Lion. Specifically, they sought to document, for ABC’s PrimeTime Live program, Food Lion employees engaging in unsanitary practices, treating products to hide spoilage, and repackaging and redat-ing out-of-date products. The jury found that Dale and Barnett breached their duty of loyalty to Food Lion, and nominal damages of $1.00 were awarded.3

As a matter of agency law, an employee owes a duty of loyalty to her employer. In South Carolina it is “implicit in any contract for employment that the employee shall remain faithful to the employer’s interest throughout the term of employment.” Berry v. Goodyear Tire and Rubber Co., 270 S.C. 489, 242 S.E.2d 551, 552 (S.C.1978). In North Carolina “the law implies a promise on the part of every employee to serve [her] employer faithfully.” McKnight v. Simpson’s Beauty Siupply, Inc., 86 N.C.App. 451, 358 S.E.2d 107, 109 (N.C.Ct.App.1987). The courts of North and South Carolina have not set out a specific test for determining when the duty of loyalty is breached. Disloyalty has been described in fairly broad terms, however. Employees are disloyal when their acts are “inconsistent with promoting the best interest of their employer at a time when they were on its payroll,” Lowndes Prods., Inc. v. Brower, 259 S.C. 322, 191 S.E.2d 761, 767 (S.C.1972), and an employee who “deliberately acquires an interest adverse to his employer ... is disloyal,” Long v. Vertical Techs., Inc., 113 N.C.App. 598, 439 S.E.2d 797, 802 (N.C.Ct.App.1994).

ABC is correct to remind us that employee disloyalty issues are usually dealt with in the context of the employment contract: unfaithful employees are simply discharged, disciplined, or reprimanded. Up to now, disloyal conduct by an employee has been considered tortious in North and South Carolina in three circumstances. First, the tort of breach of duty of loyalty applies when an employee competes directly with her employer, either on her own or as an agent of a rival company. See id. at 801-02 (duty breached when employee used current employer’s resources during business hours to develop rival company); Lowndes Prods., 191 S.E.2d at 767 (duty breached when employees conspired to take trade secrets and hire away other workers for the benefit of rival company they were forming). Second, the tort applies when the employee misappropriates her employer’s profits, property, or business opportunities. See Sara Lee Corp. v. Carter, 129 N.C.App. 464, 500 S.E.2d 732, 736-37 (N.C.Ct.App.1998) (duty breached *516when employee bought parts for employer at above market prices from company partly owned by employee); Construction Techniques, Inc. v. Dominske, 928 F.2d 632, 636-39 (4th Cir.1991) (applying South Carolina law) (employee’s ownership interest in one of his employer’s suppliers was inherently adverse to interests of employer; duty of loyalty was not breached only because employee disclosed this interest to employer). Third, the tort applies when the employee breaches her employer’s confidences. See Lowndes Prods., 191 S.E.2d at 767 (duty breached when employees used employer’s trade secrets after forming competing business).

Because Dale and Barnett did not compete with Food Lion, misappropriate any of its profits or opportunities, or breach its confidences, ABC argues that the reporters did not engage in any disloyal conduct that is tortious under existing law. Indeed, the district court acknowledged that it was the first court to hold that the conduct in question “would be recognized by the Supreme Courts of North Carolina and South Carolina” as tortiously violating the duty of loyalty. Food Lion, Inc. v. Capital Cities/ABC, Inc., 964 F.Supp. 956, 959 n. 2 (M.D.N.C.1997). We believe the district court was correct to conclude that those courts would decide today that the reporters’ conduct was sufficient to breach the duty of loyalty and trigger tort liability.

What Dale and Barnett did verges on the kind of employee activity that has already been determined to be tortious. The interests of the employer (ABC) to whom Dale and Barnett gave complete loyalty were adverse to the interests of Food Lion, the employer to whom they were unfaithful. ABC and Food Lion were not business competitors but they were adverse in a fundamental way. ABC’s interest was to expose Food Lion to the public as a food chain that engaged in unsanitary and deceptive practices. Dale and Barnett served ABC’s interest, at the expense of Food Lion, by engaging in the taping for ABC while they were on Food Lion’s payroll. In doing this, Dale and Barnett did not serve Food Lion faithfully, and their interest (which was the same as ABC’s) was diametrically opposed to Food Lion’s. In these circumstances, we believe that the highest courts of North and South Carolina would hold that the reporters — in promoting the interests of one master, ABC, to the detriment of a second, Food Lion — committed the tort of disloyalty against Food Lion.

Our holding on this point is not a sweeping one. An employee does not commit a tort simply by holding two jobs or by performing a second job inadequately. For example, a second employer has no tort action for breach of the duty of loyalty when its employee fails to devote adequate attention or effort to her second (night shift) job because she is tired. That is because the inadequate performance is simply an incident of trying to work two jobs. There is no intent to act adversely to the second employer for the benefit of the first. Cf. Long, 439 S.E.2d at 802 (finding disloyalty when employee “deliberately” acquired an interest adverse to his employer). Because Dale and Barnett had the requisite intent to act against the interests of them second employer, Food Lion, for the benefit of their main employer, ABC, they were liable in tort for their disloyalty.

We hold that, insofar as North and South Carolina law is concerned, the district court did not err in refusing to set aside the jury’s verdict that Dale and Barnett breached their duty of loyalty to Food Lion.

3.

ABC argues that it was error to allow the jury to hold Dale and Barnett liable for trespass on either of the independent grounds (1) that Food Lion’s consent to their presence as employees was void because it was based on misrepresentations or (2) that Food Lion’s consent was vitiat*517ed when Dale and Barnett breached the duty of loyalty. The jury found Dale and Barnett liable on both of these grounds and awarded Food Lion $1.00 in nominal damages, which is all that was sought in the circumstances.

In North and South Carolina, as elsewhere, it is a trespass to enter upon another’s land without consent. See, e.g., Smith v. VonCannon, 283 N.C. 656, 197 S.E.2d 524, 528 (N.C.1973); Snow v. City of Columbia, 305 S.C. 544, 409 S.E.2d 797, 802 (S.C.Ct.App.1991). Accordingly, consent is a defense to a claim of trespass. See, e.g., Miller v. Brooks, 123 N.C.App. 20, 472 S.E.2d 350, 355 (N.C.Ct.App.1996), review denied, 345 N.C. 344, 483 S.E.2d 172 (N.C.1997). Even consent gained by misrepresentation is sometimes sufficient. See Desnick v. American Broad. Cos., 44 F.3d 1345, 1351-52 (7th Cir.1995) (Posner, C.J.). The consent to enter is canceled out, however, “if a wrongful act is done in excess of and in abuse of authorized entry.” Miller, 472 S.E.2d at 355 (citing Blackwood v. Cates, 297 N.C. 163, 254 S.E.2d 7, 9 (N.C.1979)). Cf. Ravan v. Greenville County, 315 S.C. 447, 434 S.E.2d 296, 306 (S.C.Ct.App.1993) (noting that the law of trespass protects the “peaceable possession” of property).

We turn first to whether Dale and Barnett’s consent to be in non-public areas of Food Lion property was void from the outset because of the resume misrepresentations. “[C]onsent to an entry is often given legal effect” even though it was obtained by misrepresentation or concealed intentions. Desnick, 44 F.3d at 1351. Without this result,

a restaurant critic could not conceal his identity when he ordered a meal, or a browser pretend to be interested in merchandise that he could not afford to buy. Dinner guests would be trespassers if they were false friends who never would have been invited had the host known their true character, and a consumer who in an effort to bargain down an automobile dealer falsely claimed to be able to buy the same car elsewhere at a lower price would be a trespasser in a dealer’s showroom.

Id.

Of course, many cases on the spectrum become much harder than these examples, and the courts of North and South Carolina have not considered the validity of a consent to enter land obtained by misrepresentation. Further, the various jurisdictions and authorities in this country are not of one mind in dealing with the issue. Compare Restatement (Second) of Torts, § 892B(2) (1965) (“[i]f the person consenting to the conduct of another ... is induced [to consent] by the other’s misrepresentation, the consent is not effective for the unexpected invasion or harm”) and Shiffman v. Empire Blue Cross and Blue Shield, 256 A.D.2d 131, 681 N.Y.S.2d 511, 512 (App.Div.1998) (reporter who gained entry to medical office by posing as potential patient using false identification and insurance cards could not assert consent as defense to trespass claim “since consent obtained by misrepresentation or fraud is invalid”), with Desnick, 44 F.3d at 1351-53 (ABC agents with concealed cameras who obtained consent to enter an ophthalmic clinic by pretending to be patients were not trespassers because, among other things, they “entered offices open to anyone”); Baugh v. CBS, Inc., 828 F.Supp. 745, 757 (N.D.Cal.1993) (“where consent was fraudulently induced, but consent was nonetheless given, plaintiff has no claim for trespass”); and Martin v. Fidelity & Cas. Co. of New York, 421 So.2d 109, 111 (Ala.1982) (consent to enter is valid “even though consent may have been given under a mistake of facts, or procured by fraud”) (citation omitted).

We like Desnick’s thoughtful analysis about when a consent to enter that is based on misrepresentation may be given effect. In Desnick ABC sent persons posing as patients needing eye care to the plaintiffs’ eye climes, and the test patients secretly recorded their examinations. *518Some of the recordings were used in a PrimeTime Live segment that alleged intentional misdiagnosis and unnecessary cataract surgery. Desnick held that although the test patients misrepresented their purpose, their consent to enter was still valid because they did not invade “any of the specific interests[relating to peaceable possession of land] the tort of trespass seeks to protect:” the test patients entered offices “open to anyone expressing a desire for ophthalmic services” and videotaped doctors engaged in professional discussions with strangers, the testers; the testers did not disrupt the offices or invade anyone’s private space; and the testers did not reveal the “intimate details of anybody’s life.” 44 F.3d at 1352-53. Desnick supported its conclusion with the following comparison:

“Testers” who pose as prospective home buyers in order to gather evidence of housing discrimination are not trespassers even if they are private persons not acting under color of law. The situation of [ABC’s] “testers” is analogous. Like testers seeking evidence of violation of anti-discrimination laws, [ABC’s] test patients gained entry into the plaintiffs’ premises by misrepresenting their purposes (more precisely by a misleading omission to disclose those purposes). But the entry was not invasive in the sense of infringing the kind of interest of the plaintiffs that the law of trespass protects; it was not an interference with the ownership or possession of land.

Id. at 1353 (citation omitted).4

We return to the jury’s first trespass finding in this case, which rested on a narrow ground. The jury found that Dale and Barnett were trespassers because they entered Food Lion’s premises as employees with consent given because of the misrepresentations in their job applications. Although the consent cases as a class are inconsistent, we have not found any case suggesting that consent based on a resume misrepresentation turns a successful job applicant into a trespasser the moment she enters the employer’s premises to begin work. Moreover, if we turned successful resume fraud into trespass, we would not be protecting the interest underlying the tort of trespass — the ownership and peaceable possession of land. See Desnick, 44 F.3d at 1352; see generally Matthews v. Forrest, 235 N.C. 281, 69 S.E.2d 553, 555 (N.C.1952); Ravan, 434 S.E.2d at 306. Accordingly, we cannot say that North and South Carolina’s highest courts would hold that misrepresentation on a job application alone nullifies the consent given to an employee to enter the employer’s property, thereby turning the employee into a trespasser. The jury’s finding of trespass therefore cannot be sustained on the grounds of resume misrepresentation.

There is a problem, however, with what Dale and Barnett did after they entered Food Lion’s property. The jury also found that the reporters committed trespass by breaching their duty of loyalty to Food Lion “as a result of pursuing [their] investigation for ABC.” We affirm the finding of trespass on this ground because the breach of duty of loyalty- — triggered by the filming in non-public areas, which was adverse to Food Lion — was a wrongful act in excess of Dale and Barnett’s authority to enter Food Lion’s premises as employees. See generally Blackwood, 254 S.E.2d at 9 (finding liability for trespass when activity on property exceeded scope of consent to enter).

The Court of Appeals of North Carolina has indicated that secretly installing a video camera in someone’s private home can be a wrongful act in excess of consent given to enter. In the trespass case of Miller v. Brooks the (defendant) wife, who claimed she had consent to enter her estranged husband’s (the plaintiffs) house, had a private detective place a video cam*519era in the ceiling of her husband’s bedroom. The court noted that “[e]ven an authorized entry can be trespass if a wrongful act is done in excess of and in abuse of authorized entry.” Miller, 472 S.E.2d at 355. The court went on to hold that “[e]ven if [the wife] had permission to enter the house and to authorize others to do so,” it was a jury question “whether defendants’ entries exceeded the scope of any permission given.” Id. We recognize that Miller involved a private home, not a grocery store, and that it involved some physical alteration to the plaintiffs property (installation of a camera). Still, we believe the general principle is applicable here, at least in the case of Dale, who worked in a Food Lion store in North Carolina. Although Food Lion consented to Dale’s entry to do her job, she exceeded that consent when she videotaped in nonpublic areas of the store and worked against the interests of her second employer, Food Lion, in doing so.

We do not have a case comparable to Miller from South Carolina. Nevertheless, the South Carolina courts make clear that the law of trespass protects the peaceable enjoyment of property. See Ravan, 434 S.E.2d at 306. It is consistent with that principle to hold that consent to enter is vitiated by a wrongful act that exceeds and abuses the privilege of entry.

Here, both Dale and Barnett became employees of Food Lion with the certain consequence that they would breach their implied promises to serve Food Lion faithfully. They went into areas of the stores that were not open to the public and secretly videotaped, an act that was directly adverse to the interests of their second employer, Food Lion. Thus, they breached the duty of loyalty, thereby committing a wrongful act in abuse of their authority to be on Food Lion’s property.

In sum, we are convinced that the highest courts of North and South Carolina would hold that Dale and Barnett committed trespass because Food Lion’s consent for them to be on its property was nullified when they tortiously breached their duty of loyalty to Food Lion. Accordingly, as far as North and South Carolina law is concerned, the jury’s trespass verdict should be sustained.

4.

Dale worked in a Food Lion store in North Carolina. Based on the jury’s finding of fraud and a special interrogatory, the district court determined that ABC and Dale were liable under the North Carolina UTPA, N.C. Gen.Stat. § 75-1.1. Because Food Lion elected to take damages on the fraud claim, the district court awarded no damages on the UTPA claim. ABC argues that the Act does not apply to the circumstances of this case, and we agree.

North Carolina’s UTPA prohibits “[unfair methods of competition” and “unfair or deceptive acts or practices” that are “in or affecting commerce.” N.C. Gen.Stat. § 75-l.l(a). “Commerce” is defined to include “all business activities, however denominated.” N.C. Gen.Stat. § 75 — 1.1(b). Food Lion contends that Dale’s misrepresentations on her job application were “deceptive acts” “in or affecting commerce” because they were made to further the production of PrimeTime Live, a business activity.

Although the UTPA’s language is quite broad, “the Act is not intended to apply to all wrongs in a business setting.” HAJMM Co. v. House of Raeford Farms, Inc., 328 N.C. 578, 403 S.E.2d 483, 492 (N.C.1991). The Act’s primary purpose is to protect the consuming public. See Skinner v. E.F. Hutton & Co., Inc., 314 N.C. 267, 333 S.E.2d 236, 241 (N.C.1985). It gives a private cause of action to consumers aggrieved by unfair or deceptive business practices. See Marshall v. Miller, 302 N.C. 539, 276 S.E.2d 397, 400 (N.C.1981). In addition, businesses are sometimes allowed to assert UTPA claims against other businesses because “unfair trade practices involving only businesses” *520can “affect the consumer as well.” United Labs., Inc. v. Kuykendall, 322 N.C. 643, 370 S.E.2d 375, 389 (N.C.1988). But one business is permitted to assert an UTPA claim against another business only when the businesses are competitors (or potential competitors) or are engaged in commercial dealings with each other. See, e.g., Winston Realty Co. v. G.H.G., Inc., 314 N.C. 90, 331 S.E.2d 677 (N.C.1985) (UTPA applies when temporary personnel agency falsely claims to have conducted background checks of workers it sends to companies); Harrington Mfg. Co. v. Powell Mfg. Co., 38 N.C.App. 393, 248 S.E.2d 739 (N.C.Ct.App.1979) (UTPA applies when manufacturer passes off its competitor’s goods as those of its own); Concrete Serv. Corp. v. Investors Group, Inc., 79 N.C.App. 678, 340 S.E.2d 755, 760-61 (N.C.Ct.App.1986) (UTPA covers acts intended to deceive suppliers into extending credit). In any event, the fundamental purpose of the UTPA is to protect the consumer, and courts invariably look to that purpose in deciding whether the Act applies. See Lindner v. Durham Hosiery Mills, Inc., 761 F.2d 162, 165-67 (4th Cir.1985).

The district court found an UTPA violation because ABC is a business that engaged in deception. However, the deception — the misrepresentations in Dale’s application — did not harm the consuming public. Presumably, ABC intended to benefit the consuming public by letting it know about Food Lion’s food handling practices. Moreover, ABC was not competing with Food Lion, and it did not have any actual or potential business relationship with the grocery chain. The UTPA, therefore, cannot be used here because there is no competitive or business relationship that can be policed for the benefit of the consuming public. The North Carolina statute has not been applied to a circumstance like this, and we believe the Supreme Court of North Carolina would hold that it should not be. We therefore reverse the district court’s judgment that the ABC defendants, including Dale, were liable under the North Carolina UTPA.

B.

ABC argues that even if state tort law covers some of Dale and Barnett’s conduct, the district court erred in refusing to subject Food Lion’s claims to any level of First Amendment scrutiny. ABC makes this argument because Dale and Barnett were engaged in newsgathering for PrimeTime Live. It is true that there are “First Amendment interests in news-gathering.” In re Shain, 978 F.2d 850, 855 (4th Cir.1992) (Wilkinson J., concurring). See also Branzburg v. Hayes, 408 U.S. 665, 681, 92 S.Ct. 2646, 33 L.Ed.2d 626 (1972) (“without some protection for seeking out the news, freedom of the press could be eviscerated.”). However, the Supreme Court has said in no uncertain terms that “generally applicable laws do not offend the First Amendment simply because their enforcement against the press has incidental effects on its ability to gather and report the news.” Cohen v. Cowles Media Co., 501 U.S. 663, 669, 111 S.Ct. 2513, 115 L.Ed.2d 586 (1991); see also Desnick, 44 F.3d at 1355 (“the media have no general immunity from tort or contract liability”).

In Cowles, Cohen, who was associated with a candidate for governor of Minnesota, gave damaging information about a candidate for another office to two reporters on their promise that his (Cohen’s) identity would not be disclosed. Because editors at the reporters’ newspapers concluded that the source was an essential part of the story, it was published with Cohen named as the origin. Cohen was fired from his job as a result, and he sued the newspapers for breaking the promise. The question in the Supreme Court was whether the First Amendment barred Cohen from recovering damages under state promissory estoppel law. The newspapers argued that absent “a need to further a state interest of the highest order,” the First Amendment protected them from lia*521bility for publishing truthful information, lawfully obtained, about a matter of public concern. Id. at 668-69, 111 S.Ct. 2513 (quoting Smith v. Daily Mail Publ’g Co., 443 U.S. 97, 103, 99 S.Ct. 2667, 61 L.Ed.2d 399 (1979)). The Supreme Court disagreed, holding that the press “has no special immunity from the application of general laws” and that the enforcement of general laws against the press “is not subject to stricter scrutiny than would be applied to enforcement against other persons or organizations.” Id. at 670, 111 S.Ct. 2513 (quoting Associated Press v. NLRB, 301 U.S. 103, 132, 57 S.Ct. 650, 81 L.Ed. 953 (1937)).

The key inquiry in Cowles was whether the law of promissory estoppel was a generally applicable law. The Court began its analysis with some examples of generally applicable laws that must be obeyed by the press, such as those relating to copyright, labor, antitrust, and tax. Id. at 669, 111 S.Ct. 2513. More relevant to us, “[t]he press may not with impunity break and enter an office or dwelling to gather news.” Id. In analyzing the doctrine of promissory estoppel, the Court determined that it was a law of general applicability because it “does not target or single out the press,” but instead applies “to the daily transactions of all the citizens of Minnesota.” Id. at 670, 111 S.Ct. 2513. The Court concluded that “the First Amendment does not confer on the press a constitutional right to disregard promises that would otherwise be enforced under state law.” Id. at 672, 111 S.Ct. 2513. The Court thus refused to apply any heightened scrutiny to the enforcement of Minnesota’s promissory estoppel law against the newspapers.

The torts Dale and Barnett committed, breach of the duty of loyalty and trespass, fit neatly into the Cowles framework. Neither tort targets or singles out the press. Each applies to the daily transactions of the citizens of North and South Carolina. If, for example, an employee of a competing grocery chain hired on with Food Lion and videotaped damaging information in Food Lion’s non-public areas for later disclosure to the public, these tort laws would apply with the same force as they do against Dale and Barnett here. Nor do we believe that applying these laws against the media will have more than an “incidental effect” on newsgathering. See Cowles, 501 U.S. at 669, 671-72, 111 S.Ct. 2513. We are convinced that the media can do its important job effectively without resort to the commission of run-of-the-mill torts.5

ABC argues that Cowles is not to be applied automatically to every “generally applicable law” because the Supreme Court has since said that “the enforcement of [such a] law may or may not be subject to heightened scrutiny under the First Amendment.” Turner Broadcasting System, Inc. v. FCC, 512 U.S. 622, 640, 114 S.Ct. 2445, 129 L.Ed.2d 497 (1994) (contrasting Barnes v. Glen Theatre, Inc., 501 U.S. 560, 111 S.Ct. 2456, 115 L.Ed.2d 504 (1991), and Cowles). In Glen Theatre nude dancing establishments and their dancers challenged a generally applicable law prohibiting public nudity. Because the general ban on public nudity covered nude dancing, which was expressive conduct, the Supreme Court applied heightened scrutiny. Glen Theatre, 501 U.S. at 566, 111 S.Ct. 2456. In Cocoles a generally applicable law (promissory estoppel) was invoked against newspapers who broke their promises to a source that they would keep his name confidential in exchange for information leading to a news story. There, the Court refused to apply heightened scrutiny, concluding that application of the doctrine of promissory estoppel had “no more than [an] incidental” effect on the press’s ability to gather or report news. Cowles, 501 U.S. at 671-72, 111 S.Ct. 2513. There is arguable tension between the ap*522proaches in the two cases. The cases are consistent, however, if we view the challenged conduct in Cowles to be the breach of promise and not some form of expression. In Glen Theatre, on the other hand, an activity directly covered by the law, nude dancing, necessarily involved expression, and heightened scrutiny was applied. Here, as in Coioles, heightened scrutiny does not apply because the tort laws (breach of duty of loyalty and trespass) do not single out the press or have more than an incidental effect upon its work.

C.

For the foregoing reasons, we affirm the judgment that Dale and Barnett breached their duty of loyalty to Food Lion and committed trespass. We likewise affirm the damages award against them for these torts in the amount of $2.00. We have already indicated that the fraud claim against all of the ABC defendants must be reversed. Because Food Lion was awarded punitive damages only on its fraud claim, the judgment awarding punitive damages cannot stand.

III.

In its cross-appeal Food Lion argues that the district court erred in refusing to allow it to use its non-reputational tort claims (breach of duty of loyalty, trespass, etc.) to recover compensatory damages for ABC’s broadcast of the Prime-Time Live program that targeted Food Lion. The publication damages Food Lion sought (or alleged) were for items relating to its reputation, such as loss of good will and lost sales. The district court determined that the publication damages claimed by Food Lion “were the direct result of diminished consumer confidence in the store” and that “it was[Food Lion’s] food handling practices themselves — not the method by which they were recorded or published — which caused the loss of consumer confidence.” Food Lion, Inc. v. Capital Cities/ABC, Inc., 964 F.Supp. 956, 963 (M.D.N.C.1997). The court therefore concluded that the publication damages were not proximately caused by the non-reputational torts committed by ABC’s employees. We do not reach the matter of proximate cause because an overriding (and settled) First Amendment principle precludes the award of publication damages in this case, as ABC has argued to the district court and to us. Food Lion attempted to avoid the First Amendment limitations on defamation claims by seeking publication damages under non-reputa-tional tort claims, while holding to the normal state law proof standards for these torts. This is precluded by Hustler Magazine v. Falwell, 485 U.S. 46, 108 S.Ct. 876, 99 L.Ed.2d 41 (1988).

Food Lion acknowledges that it did not sue for defamation because its “ability to bring an action for defamation ... required proof that ABC acted with actual malice.” Appellee’s Opening Br. at 44. Food Lion thus understood that if it sued ABC for defamation it would have to prove that the PrimeTime Live broadcast contained a false statement of fact that was made with “actual malice,” that is, with knowledge that it was false or with reckless disregard as to whether it was true or false. See New York Times Co. v. Sullivan, 376 U.S. 254, 279-80, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964). It is clear that Food Lion was not prepared to offer proof meeting the New York Times standard under any claim that it might assert. What Food Lion sought to do, then, was to recover defamation-type damages under non-repu-tational tort claims, without satisfying the stricter (First Amendment) standards of a defamation claim. We believe that such an end-run around First Amendment strictures is foreclosed by Hustler.

In Hustler a popular liquor advertisement prompted the magazine to run a parody of the ad, labeled as such, that featured the Reverend Jerry Falwell “discussing” an incestuous sexual act he had undertaken while drunk in disgusting circumstances. Falwell sued the magazine and its publisher, Larry Flynt, seeking *523damages for libel and intentional infliction of emotional distress. At trial the jury-held against Falwell on the libel claim, specifically finding that the ad parody could not reasonably be understood as describing actual facts about Falwell or actual events in which he participated. The jury, however, found for Falwell on the emotional distress claim and awarded compensatory and punitive damages.

It was clear that Falwell, in asserting the claim for intentional infliction of emotional distress, sought “damages for emotional harm caused by the publication of an ad parody offensive to him.” Hustler, 485 U.S. at 50, 108 S.Ct. 876 (emphasis added). In the Supreme Court the question was whether Falwell had to satisfy the heightened First Amendment proof standard set forth in New York Times. After concluding that the ad parody was protected expression, the Court, in an opinion by Chief Justice Rehnquist, held that the constitutional libel standard applied to Fal-welFs emotional distress claim:

We conclude that public figures and public officials may not recover for the tort of intentional infliction of emotional distress by reason of publications such as the one here at issue without showing in addition that the publication contains a false statement of fact which was made with “actual malice,” i.e., with knowledge that the statement was false or with reckless disregard as to whether or not it was true.

Hustler, 485 U.S. at 56, 108 S.Ct. 876.

Hustler confirms that when a public figure plaintiff uses a law to seek damages resulting from speech covered by the First Amendment, the plaintiff must satisfy the proof standard of New York Times. Here, Food Lion was not prepared to meet this standard for publication damages under any of the claims it asserted. Unless there is some way to distinguish Hustler (we think there is not, see below), Food Lion cannot sustain its request for publication damages from the ABC broadcast.

Food Lion argues that Cowles, supra, and not Hustler governs its claim for publication damages. According to Food Lion, Cowles allowed the plaintiff to recover — without satisfying the constitutional prerequisites to a defamation action — economic losses for publishing the plaintiffs identity in violation of a legal duty arising from generally applicable law. Food Lion says that its claim for damages is like the plaintiffs in Cowles, and not like Falwell’s in Hustler. This argument fails because the Court in Cowles distinguished the damages sought there from those in Hustler in a way that also distinguishes Food Lion’s case from Cowles:

Cohen is not seeking damages for injury to his reputation or his state of mind. He sought damages ... for breach of a promise that caused him to lose his job and lowered his earning capacity. Thus, this is not a case like Hustler ... where we held that the constitutional libel standards apply to a claim alleging that the publication of a parody was a state-law tort of intentional infliction of emotional distress.

Cowles, 501 U.S. at 671, 111 S.Ct. 2513. Food Lion, in seeking compensation for matters such as loss of good will and lost sales, is claiming reputational damages from publication, which the Cowles Court distinguished by placing them in the same category as the emotional distress damages sought by Falwell in Hustler. In other words, according to Cowles, “constitutional libel standards” apply to damage claims for reputational injury from a publication such as the one here.

Food Lion also argues that because ABC obtained the videotapes through unlawful acts, that is, the torts of breach of duty of loyalty and trespass, it (Food Lion) is entitled to publication damages without meeting the New York Times standard. The Supreme Court has never suggested that it would dispense with the Times standard in this situation, and we believe Hustler indicates that the Court would not. In Hustler the magazine’s conduct would *524have been sufficient to constitute an unlawful act, the intentional infliction of emotional distress, if state law standards of proof had applied. Indeed, the Court said, “[generally speaking the law does not regard the intent to inflict emotional distress as one which should receive much solicitude.” Hustler, 485 U.S. at 53, 108 S.Ct. 876. Notwithstanding the nature of the underlying act, the Court held that satisfying New York Times was a prerequisite to the recovery of publication damages. That result was “necessary,” the Court concluded, in order “to give adequate ‘breathing space’ to the freedoms protected by the First Amendment.” Id. at 56, 108 S.Ct. 876.

In sum, Food Lion could not bypass the New York Times standard if it wanted publication damages. The district court therefore reached the correct result when it disallowed these damages, although we affirm on a different ground.

IV.

To recap, we reverse the judgment to the extent it provides that the ABC defendants committed fraud and awards compensatory damages of $1,400 and punitive damages of $315,000 on that claim; we affirm the judgment to the extent it provides that Dale and Barnett breached their duty of loyalty to Food Lion and committed a trespass and awards total damages of $2.00 on those claims; we reverse the judgment to the extent it provides that the ABC defendants violated the North Carolina UTPA; and we affirm the district court’s ruling that Food Lion was not entitled to prove publication damages on its claims.

AFFIRMED IN PART AND REVERSED IN PART.

NIEMEYER, Circuit Judge, concurring in part and dissenting in part:

Because I believe that ample evidence supports the jury’s verdict finding that the ABC defendants acted fraudulently, I dissent from Part II.A.1. of the majority opinion. I am pleased to join the remainder.

I

The transactional facts are not disputed. In order to obtain an inside story, ABC’s PrimeTime Live devised a plan by which ABC’s employees would falsely represent themselves to Food Lion to obtain jobs in its stores and then would secretly film the activities of Food Lion’s employees, including themselves, using miniature “spy cam” equipment.

In applying for jobs at Food Lion stores, ABC reporters Lynne Dale and Susan Barnett misrepresented themselves, their experience, and their references, even though they certified that their applications were complete and truthful. More fundamentally, they misrepresented themselves as bona fide applicants for employment. They were already employees of ABC and knew that within a week or two they would no longer be working for Food Lion. After Food Lion gave them jobs at stores in North Carolina and South Carolina, Dale and Barnett roamed the stores to obtain film footage for PrimeTime Live. While some of the film footage so obtained was damaging to Food Lion, these reporters contributed to the damage. For example, when Barnett saw food that she suspected to be out of date, she sold it to her camera crew rather than throw it away. Similarly, she attempted to sell such food to a customer. When these reporters obtained their film footage — after two weeks for Barnett and one week for Dale — they quit their jobs at Food Lion and provided the videotapes to ABC’s PrimeTime Live for broadcast on national television.

The jury returned a verdict against the ABC defendants based on fraud and awarded Food Lion $1,400 in compensatory damages and over $5.5 million in punitive damages. The district court remitted the $5.5 million punitive damage award to $315,000. I would affirm this judgment.

*525II

The elements of a fraud claim under North Carolina law are “(1) [a][f]alse representation or concealment of a material fact, (2) reasonably calculated to deceive, (3) made with intent to deceive, (4) which does in fact deceive, (5) resulting in damage to the injured party.” Myers & Chapman, Inc. v. Thomas G. Evans, Inc., 323 N.C. 559, 374 S.E.2d 385, 391 (N.C.1988) (emphasis omitted) (quoting Ragsdale v. Kennedy, 286 N.C. 130, 209 S.E.2d 494, 500 (N.C.1974)). The requirements under South Carolina law are similar. See Florentine Corp. v. PEDA I, Inc., 287 S.C. 382, 339 S.E.2d 112, 113-14 (S.C.1985).

In reversing the jury’s fraud verdict, the majority agrees with the ABC defendants that Food Lion failed to prove the injury element of its fraud claim because the expenses it incurred in training at-will employees could not be claimed as damages. The majority explains, “North and South Carolina are at-will employment states, and under the at-will doctrine it is unreasonable for either the employer or the employee to rely on any assumptions about the duration of employment.” Ante, at 513.

I respectfully disagree, and my disagreement focuses on (1) the difference in hiring a person who intends to work indefinitely and a person who intends to work one or two weeks and fails to disclose that intent, and (2) the ABC employees’ misrepresentation of loyalty inherent in their application for a job. I will discuss these in order.

A

The majority concludes that there is no difference in Food Lion’s unwitting employment of ABC reporters who intend to leave within one or two weeks and employment of applicants who have no specific intent about the duration of their employment because both types of the employment are “at will.” This, however, overlooks the difference between a bona fide at-will employee and an undercover news reporter who knows from the beginning that she will stay only two weeks. With the former, normal risks allow for the possibility that Food Lion can obtain long-term, experienced, faithful service from which it can recover its training expenses; with the latter there is no such possibility.

Applicants for employment, even at-will employment, present themselves representing by implication: (1) that they want to become employees; (2) that they intend to work indefinitely, until a change in circumstances leads them or their employer to terminate the arrangement; (3) that there is a possibility that they would become long-term employees; and (4) that they will be loyal employees as long as they work, prepared to work at the promotion of their employer’s business. ABC’s undercover reporters presented themselves to Food Lion, representing all of these matters falsely. They did not, during the application process, disclose that they did not intend to become employees at all. Indeed, they were already employed by ABC, and their application for employment with Food Lion was only a sham to get them into locations within Food Lion where they otherwise would not be permitted. Moreover, the ABC employees had no intention of allowing the normal risks of at-will employment to govern their term; they knew from the beginning that they were to be at Food Lion only long enough to obtain damaging information.

In training new employees and investing in their future, Food Lion has a right to assume that the normal risks attend the relationship and that some of those employees will eventually become experienced and loyal employees who will provide a return on the costs of training them. The fact that Food Lion would not make such an investment in an applicant if the applicant stated that she was an ABC employee only seeking inside information and that she would leave after two weeks defines the injury sustained by Food Lion. Indeed, *526far less injury is required by law. Where a plaintiff presents evidence that the defendant’s fraudulent misrepresentation induced the plaintiff to deal “with a party with whom it did not wish to deal,” “sufficient injury” has been shown “to meet the requisite damage element of fraud” and the plaintiff is “entitled to recover any damages shown to result therefrom.” Daniel Boone Complex, Inc. v. Furst, 43 N.C.App. 95, 258 S.E.2d 379, 386-87 (N.C.Ct.App.1979). Not only was Food Lion induced to hire persons it would not otherwise have hired, it was induced to spend money on persons whose potential for employment was nil, contrary to the potential of a bona fide applicant for at-will employment.

B

Similarly and perhaps more importantly, Dale and Barnett’s implied representations that they would be loyal Food Lion employees injured Food Lion. Both North Carolina and South Carolina law provide that implicit in any contract for employment is the duty of the employee to “remain faithful to the employer’s interest throughout the term of employment.” Berry v. Goodyear Tire & Rubber Co., 270 S.C. 489, 242 S.E.2d 551, 552 (S.C.1978); see also McKnight v. Simpson’s Beauty Supply, Inc. 86 N.C.App. 451, 358 S.E.2d 107, 109 (N.C.Ct.App.1987) (“[T]he law implies a promise on the part of every employee to serve his employer faithfully”). And when an employee acts adversely to the interest of his employer, he is disloyal and his discharge is justified. Berry, 242 S.E.2d at 552.

In this case, Dale and Barnett never intended to work as loyal employees for Food Lion and to promote the business of Food Lion. On the contrary, they applied to Food Lion with the secret intent to obtain sensational and damaging evidence to publish against Food Lion. And in furtherance of that purpose they even failed to do what they were hired to do. As one snippet from their videotape shows, instead of cleaning a meat grinder that a loyal employee would have undertaken to clean, even if the task were not specifically assigned to the employee, the ABC employee photographed the dirty meat grinder and offered it as an example of poor food-handling practices. Moreover, in seeking to “uncover” practices, the ABC employees baited fellow employees to say and do things that they knew would undermine Food Lion’s standing food-handling practices. Indeed, a portion of the majority opinion, which I have joined, concludes that these employees breached their duties of loyalty to Food Lion and, in doing so, caused Food Lion damage. I believe that this very breach and injury, when intended from the very beginning, also supports Food Lion’s fraud claim.

Ill

In short, the ABC employees misrepresented their potential for staying at Food Lion and they misrepresented their loyalty. Food Lion had less of a chance— indeed, no chance — of developing experienced, long-term, and loyal employees because the likelihood of that possibility was misrepresented. If these ABC employees had disclosed their true identities and intentions accurately, Food Lion would never have hired them and incurred expenses to train them on the chance that they would stay because the employees had already determined there was no such chance.

In my judgment, the jury had ample evidence to reach the conclusion that the ABC defendants committed common law fraud, and I would affirm its verdict.

MR. PRESIDING JUSTICE CARROLL

delivered the opinion of the court.

Mary Gleeson, who died testate on February 14,1952, owned, among other properties, 160 acres of farm land in Christian county, Illinois. By her will admitted to probate March 29, 1952, she nominated Con Colbrook, petitioner-appellee (who will be referred to herein as petitioner), executor thereof. Petitioner was also appointed as trustee under the will and the residuary estate, including the aforesaid 160 acres of land, was devised to him in trust for the benefit of decedent’s 3 children, Helen Black, Bernadine Gleeson, and Thomas Gleeson, an incompetent, who are respondents herein.

On March 1, 1950, the testatrix leased the 160 acres for the year ending March 1, 1951 to petitioner and William Curtin, a partnership. On March 1, 1951, she again leased the premises to said partnership for the year ending March 1,1952. Upon the expiration of this latter lease the partnership held over as tenants under the provisions thereof and farmed the land until March *631, 1953, at which time petitioner leased the land to another tenant. While there is no written lease in evidence, the record indicates the terms thereof provided for payment to the lessor of $10.00 per acre cash rent and a share in the crops of % of the corn and % of the small grain.

The petitioner’s appointment as trustee was confirmed by the circuit court of Christian county on April 29,1953. On July 22,1953, he filed his first semiannual report. This report was not approved and petitioner was ordered to recast the same in accordance with certain directions of the court. The recast report was filed December 5, 1953. To this report respondents filed certain objections. We are concerned here with only one of the said objections, which is as follows:

“1. Report shows trustee was co-tenant of trust real estate but fails to account for share of profits received by trustee as co-tenant which by law should be re-paid by him to trust estate.”

The record indicates no dispute as to the fact that petitioner as trustee leased a portion of the real estate of the trust to himself as a partner of William Curtin and that petitioner received a share of the profits realized by him and Curtin from their farming operation of said real estate.

Upon a hearing the court entered an order overruling the objection of the respondents to the report. From such order respondents have brought this appeal.

It is contended by respondents that the circuit court erred in overruling their objection for the reason that the law prohibits a trustee from dealing in his individual capacity with the trust and making a profit from such dealings.

The courts of this state have consistently followed a general principle of equity that a trustee cannot deal in his individual capacity with the trust property. It was announced in the early case of Thorp v. Mc-*64Cullum, 1 Gilm. 614. It has since been followed in many cases involving the relationship between the trustee and the trust property. Bennett v. Weber, 323 Ill. 283; Victor v. Hillebrecht, 339 Ill. App. 254; Green v. Gawne, 382 Ill. 363; Galbraith v. Tracy, 153 Ill. 54; Johnson v. Sarver, 350 Ill. App. 565.

Petitioner recognizes the existence of this general rule, but argues that because of the existence of the peculiar circumstances under which the petitioner proceeded, the instant case must be taken to constitute one of the rare exceptions to such rule. The circumstances alluded to as peculiar are pointed out as being the facts that the death of Mrs. Gleeson occurred on February 14, 1952, only 15 days prior to the beginning of the 1952 farm year; that satisfactory farm tenants are not always available, especially on short notice; that the petitioner had in the preceding fall of 1951 sown part of the 160 acres in wheat to be harvested in 1952; that the holding over by the trustee and his partner was in the best interests of the trust; that the same was done in an open manner; that the petitioner was honest with the trust; and that it suffered no loss as a result of the transaction.

Petitioner’s argument that the foregoing constitutes circumstances bringing this case within any exception to the general rule does not appear to be supported by the authorities. In Sherman v. White, 62 Ill. App. 271 and Bold v. Mid-City Trust & Savings Bank, 279 Ill. App. 365 cited by petitioner, the court followed the general rule announced in so many cases to the effect that a trustee may not deal with trust property in his individual capacity. While giving recognition to the rare exception that a trustee may, under certain circumstances, be entitled to make a personal gain out of the trust property, the court in both cases adhered to the general rule as above stated. While on the facts these two cases differ from that presented by the instant record, the basic problem with which the court dealt *65in each instance was the same. The question for decision on this appeal was whether the record reflects a sufficient reason for permitting the petitioner to deal with the trust property for his own individual benefit.

Petitioner contends that since only 15 days intervened between the death of Mrs. Gleeson and the beginning of the farm year, and that good tenant farmers might not be available at such a time, it was in the interests of the trust that the petitioner continue to hold over for the year of 1952. No showing is made that petitioner tried to obtain a satisfactory tenant to replace Colbrook and Curtin on March 1, 1952. The record discloses that subsequent to the death of testatrix, petitioner discussed continuance of the farming operation with two of the beneficiaries under the trust and voluntarily raised the cash rent from $6.00 to $10.00 per acre. This evidence tending to show that petitioner was interested in continuing a tenancy under which he was leasing trust property to himself would seem to refute any contention that an effort to lease the property to any one other than the partnership was made. The fact that the partners had sown wheat on the land in the fall of 1951 cannot be said to be a peculiar circumstance. It is not suggested that the trust would have suffered a loss if someone other than the petitioner had farmed the land in 1952 and harvested the wheat. It would appear that a satisfactory adjustment covering the matter of the wheat could have been made between the trust and the partnership without great difficulty.

The good faith and honesty of the petitioner or the fact that the trust sustained no loss on account of his dealings therewith are all matters which can avail petitioner nothing so far as a justification of the course he chose to take in dealing with trust property is concerned. Joliet Trust & Savings Bank v. Ingalls, 276 Ill. App. 445; Michoud v. Girod, 4 How. 503.

*66Petitioner contends, under sections 10 and 12 of chapter 59, Illinois Revised Statutes 1953 [Jones Ill. Stats. Ann. 55.10, 55.12], that petitioner did not take the land in question as trustee until the debts of the testatrix were fully discharged and therefore petitioner could not have been both trustee and tenant during the year 1952. Prom the record it is evident that the petitioner regarded himself as being trustee during the time covered by his tenancy of the trust property, as his report is for the period from June 8, 1952 to June 30,1953. The sections of the statutes cited by petitioner do not apply to the situation presented on this appeal.

We think the holding of the court in. Johnson v. Sarver, supra, is applicable to the question to be decided in the instant case. Among the questions with which the court dealt in that case was the right of trustees to lease real estate of the trust to themselves. Holding that the trustees were without power to do so, the court had this to say:

“Counsel for appellants state that the holding of the chancellor to the effect that the trustees must refrain from self-dealing and cease to occupy their homes as tenants unduly discriminates against them, inasmuch as none of the other children were required to abandon their accustomed modes of making an independent living in order to share in the benefits of the trust. ... A trustee must maintain a high level of conduct and owes to those whose property'he controls undivided loyalty. It is not compulsory or mandatory that any of the trustees accept the appointment made by their father. They have accepted and asked the court to instruct them as to their duties, and if they are dissatisfied with the amount of compensation or any other requirement which the court has imposed, there is a method by which they can be relieved of their duties. *67“The chancellor . . . properly decreed that appellants, as trustees, cannot lease the real estate involved in this trust to themselves or deal with themselves.

J?

We think the decision in the foregoing case suggests that the petitioner herein, upon the death of the testatrix, instead of conferring with her beneficiaries concerning continuance of his tenancy of the trust property, should have then decided whether he chose to continue as a tenant or to act as trustee. His election was to act as trustee and as such he could not deal with himself.

This court, therefore, reaches the conclusion that the circuit court erred in overruling respondent’s objection no. 1 to the trustee’s amended first semiannual report, and that petitioner should have been required to recast his first semiannual report and to account therein for all monies received by him personally as a profit by virtue of his being a cotenant of trust property during the 1952 crop year, and to pay the amount of any such profit to the trust.

The judgment of the circuit court of Christian county is reversed and the cause remanded to that court with directions to proceed in a manner consistent with the views herein expressed.

Reversed and remanded.