Kymer v. 15 East, 62, Paterson v. Gandasequi. without any regard to dealings or payments between the principal and broker; but if the seller let the day of payment go by, the principal may be led into a supposition that the broker is to be considered the chief debtor; he may be deceived into the idea that the goods he has purchased have been paid for, and may thus be 1 Campbell, 109, led to place too much confidence in the solvency of his agent. This rule is, nevertheless, subject to qualification; for although true it is that an unknown principal, when discovered, is liable on the contracts which his agent makes for him, yet by knowingly making the agent his debtor, a party may preclude himself from recovering over against the principal. So that where the seller elects to give the agent credit, the principal is discharged. A factor made purchases for his principal, who made payments to him on account. Afterwards the factor was pressed for payment, by a letter which came to the hands of the principal, who transmitted it to the factor, and with the knowledge of that fact, paid him the residue. The principal was held liable over to the sellers for the money he had so paid to his factor after notice, but, it seems, not for such as was paid before such notice. In a late case, where the proprietor's name was not disclosed upon a sale of goods, and a payment to a broker was thereupon offered in defence, the broker having acted as agent for both parties, it appeared that, without communicating with the sellers, the broker had permitted a deviation from the original contract for payment, and evidence being tendered of the usage of trade to make such an alteration, Lord Ellenborough refused to receive it, and a verdict was given for the seller. 15 East, 65, Powel v. Nelson, cited. 1 Starkie, 233, Campbell v. Hassel. There is no difference between the cases of a broker acting under a del credere commission, and another, with respect to the credit given, where the proprietor's name is not disclosed. Neither does the knowledge (q) of the vendee that he is dealing with an agent alter the validity of his payment, if the name of the principal be not revealed to him. So a buyer may have his right of set-off against a factor, although he may know that the party with whom he is dealing is a factor, for a man who is in the habit of selling the goods of others may likewise sell goods of his own. Any collusion, however, between 2 Campbell, 24. factor and buyer will at once destroy the privileges of the latter if the buyer know of the factor's insolvency, his payments will not be protected, nor can he of course have a right of set-off for any debt of his own. See Comyn, P. 551. It is the duty of an agent to take as much care of the goods of his principal as though they were his own: and a broker must be particular in adhering to the terms of insurance prescribed by his principal (r). At the end of a very long letter, the plaintiffs directed their brokers thus: "Observe, the premium on this value is "also to be insured." But the agents, not noticing this, did not ensure such premium; whereupon their employer sued them, and they were held liable for the 1 Maule & Selomission. wyn, 52, Glaser v. Cowie. (q) Where there was nothing on the face of a bill of exchange to show that it had been drawn by an agent, the drawer was held personally liable; for it is an universal rule, that a man who puts his name to a bill of exchange thereby makes himself personally liable, unless he states upon the face of the bill that he subscribes it for another, or by procuration of another. 5 Maule & Selwyn, 345, Leadbitter v. Farrow. (r) And of every contract so prescribed: where bought and sold notes, differing materially in the terms, were de livered to the respective parties, it was held, that no valid contract had been effected. 5 Barnewall & Cresswell, 436, Grant v. Fletcher. 4 Campbell, 272, Watson v. King. 5 Espinasse, 158, Hovill v. Lethwaite. 5 Barnewall & Alderson, 35. Lord Ellen- 7 Vesey, jun. 276. See Comyn, It is sometimes material to consider how an agent's authority may be countermanded. A power, coupled with an interest, cannot be revoked during the grantor's lifetime or solvency; as if one sell, as agent, part of a ship under a power of attorney, and endorse the register in the principal's name. But where the person who had executed a power of attorney under such circumstances was supposed to have perished in a storm before the sale and endorsement of the register, it was held that his death absolutely revoked the instrument. So where a bankrupt, prior to his failure, had given a power to receive money to another person, it was held, that the bankruptcy operated as a revocation, and that the grantee of the power could not retain money received under such circumstances after the bankruptcy. A broker was instructed to sell some brimstone, and he agreed that the plaintiff should have it; but the defendant, the principal, countermanded the broker's authority before the sale note was made out, and the Chief Justice considered that the contract could not be enforced. And probably it may be good, as a general principle, that after the thing which has been intrusted to the agent has been accomplished, his authority in that respect is at an end; as in the case of an auctioneer, who is not justified in treating upon the terms of making a title after the sale. Respecting warranties by agents, as long as they restrain themselves within the instructions confided to them by their principals, so long they may be said to be free from personal responsibility; but if, acting in contravention of the authority, or endeavouring to add to it, any fresh liabilities should be incurred, they must abide the consequences. So that if an agent, who has been desired not to warrant, think proper to do so-or if a person, not authorized to pay money, take upon himself the chance of his principal's subsequent ratifi cation, he must in his own person bear any inconvenience which may happen. These observations, however, do not affect cases where there is an implied authority on the agent's part to do certain acts, as in the case of factors, &c. Contracts, There are certain liabilities and responsibilities on the See on this subparts of principals and agents, inter se, which it is desi- ject Comyn on rable to attend to. A broker agreed, in consideration p. 557. of one half per cent, to indemnify his principal from any loss on the re-sale of some cotton. But the principal, instead of selling the cotton when the price was very high in the market, waited during a considerable interval, and then sold it at a great loss, upon which an action was brought upon the contract of indemnity : it was held that the fair import of the contract was, that the defendant should be discharged if the principal were capable of making a profit of the cotton; the guarantee was, that the plaintiff should be enabled to make such a profit, and as the plaintiff had an opportunity of making his advantage, it was considered that he could 3 Term Reports, 524, Curry v. not afterwards have recourse to the defendant. And on Edensor. the other hand, where an action was brought against the defendants as indorsers of two bills of exchange, payable by merchants abroad to the defendants, and indorsed by them to the plaintiffs, who had employed them at a commission of one half per cent, it was held, that however trifling that commission, the defendants were answerable upon their indorsement; that by sending the bills into circulation before acceptance, the plaintiffs were not guilty of laches; and that, by seeing the defendants names on the bills, the plaintiffs were lulled into security, and thereby prevented from seeking the further responsibility of the drawee. Where the merchant had accepted an order for insurance, and limited the broker to too small a premium, in conse 7Taunton, 159, Goupy v. Harden. quence of which no insurance could be procured, it was 2 Term Reports, held that the merchant should make good the loss to his correspondent. 188, n. Wallace v. Telfair. 6 Term Reports, 12, Russell v. Hankey. 2 Bosanquet & Puller, 439. 8 Taunton, 202, Mainwaring v. Brandon. See Comyn, p. 561. In holding agents to be guilty of negligence in their business, much depends on the usage of trade. Brokers in London received some bills from their correspondents in the country, who were indorsees, and presented them to the acceptor for payment. The acceptor gave a check for the amount, which was dishonoured, and an action being brought against the bankers in London, Lord Kenyon nonsuited the plaintiffs; and when it was attempted to set aside the nonsuit, the Court said, "We "dare not even grant a rule to show cause, as it would "be putting the whole trade of London in suspense pending it. There is no ground to impute negligence "to the defendants." Mere negligence is not sufficient to charge an agent. It must be a gross carelessness, a breach of positive orders, or fraud, which can create such a liability. And it has been held that a mere nonfeasance will not support an action of trover for not selling goods; there must be a positive tortious act. However, where the defendant, a broker, was directed to buy Porto Rico tobacco of the best quality, and he bought some which was very bad, insomuch that the purchaser sued the vendor, and recovered, the broker was held liable, although his principal accepted the bought note; for it was a case of gross negligence; the broker might have examined the tobacco in bulk, and if he had done so, he would have been convinced that it was not Porto Rico tobacco of the best quality. If a factor or broker act against the interest of his principal, he cannot even receive his commission. And we have seen that where he pays money on account of his principal, which he is not authorized in doing, he |