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indorses in the name of the principal, the latter will not be liable on this indorsement, even in the hands of a bona fide holder.(v)
It is said that the usage of trade authorizes a merchant, making a shipment, to draw on the consignee, and binds the consignee to pay the bills if the shipment supplies him with funds. But an agent who is authorized to draw on his principals for the sums he advances on merchandise consigned to them, is not thereby authorized to draw on them on account of goods of his own which he consigns to them. In relation to these goods, he has the general rights of a merchant shipping goods, and no other. (w) A power to give a "company note" was held to include the power of drawing a bill in the name of the "company."(x) That any principal may limit any authority which he gives, precisely as he thinks proper, is unquestionable.
If an authority be given in very general terms, and the same instrument enumerates certain special objects or acts, this speci fication will be held to restrain the general words, and the instrument will be construed as if limited in its intention and operation to them, unless there be some phraseology in the instrument, or something in the nature of the case, which distinctly controls this rule of construction. (y)
If one enters into a contract as agent for another, he cannot enforce that contract in his own name and for his own benefit, as if made by himself and for himself, without giving sufficient previous notice to the other party of his purpose so to do. But with that notice, it seems that he may maintain an action on the contract in his own name, if the facts are such in other respects as would authorize him in doing so (2)
(v) Fenn v. Harrison, 3 T. R. 757.
(w) Schimmelpennich v. Bayard, 1 Pet. 264.
(y) Thus, in Rossiter v Rossiter, 8 Wend. 494, it was held, that a power of attorney to collect debts, to execute deeds of lands, to accomplish a complete adjustment of all concerns of the constituent in a particular place, and to do all other acts which the constituent could do in person, did not authorize the giving of a note by the attorney in the name of the principal. The larger powers, conferred by the general words, must be construed with reference to the matters specially mentioned. And see ante, p. 105, et seq.
(z) Bickerton v. Burrell, 5 Maule & S. 383; Rayner v. Grote, 15 M. & W. 359.
If an agent exceed his authority in signing the name of his principal to a note, the note will be void as to the principal, even in the hands of a bona fide holder. (a)
Any person who receives bills or notes for collection, or for any other specific purpose, must be controlled by any directions or limitations expressed upon them, and cannot apply the proceeds to his own benefit, in any way inconsistent with those directions or limitations; nor can he by assignment or indorsement convey the property in the paper to any one who has notice or knowledge that he therein transcends his authority.(b) So an agent or broker, who has notes or bills of another to get them discounted, cannot pledge them for money previously due from him; nor, as it would seem, could he be justified by any usage in doing so. (c) On general principles it might be said that he could not pledge them for money paid him, if the lender knew, or had sufficient reason to know, both that the notes belonged to another, and that the broker, against the purposes of the owner, was borrowing money on them for himself. Nor can he, without specific authority, pledge the bills of dif ferent customers in one mass, for this subjects each note to a lien for money advanced on the rest. But to this point it has been said that usage might enlarge the broker's authority.(d)
It has been said, on high authority, that any person taking an acceptance which purports to be by procuration, takes it on the credit of the party who assumes to have authority to accept, and should, therefore, in the exercise of due caution. and reasonable prudence, require the production of the au
(a) Fearn v. Filica, 7 Man. & G. 513; Andover v. Grafton, 7 N. H. 298, 303. In Mechanics' Bank v. New York & New Haven R. R. Co., Kern. 631, Comstock, J. says: "It is obvious, upon a moment's reflection, that negotiability can impart no vitality to an instrument executed under a power, where the agent has exceeded his actual or presumptive authority. Whoever proposes to deal with a security of any kind appearing on its face to be given by one man for another, is bound to inquire whether it has been given by due authority, and if he omits that inquiry he deals at his peril "
(b) Ancher v. Bank of England, 2 Doug. 638; Sigourney v. Lloyd, 8 B. & C 622, 5 Bing. 525.
(c) Haynes v. Foster, 2 Cromp. & M. 237; Foster v. Pearson, 1 Cromp. M. & R.
(d) Haynes v. Foster, supra; Foster v. Pearson, supra.
thority.(e) But it may be doubted whether the not requiring the production of this authority would, of itself and of necessity, be such an act of negligence as to affect his rights; although such seems to be the view held in some cases.
The unauthorized delivery of bills or notes payable to bearer gives a bona fide holder the property in them, and a right to call on all prior parties. (ƒ) And the same rule applies to negotiable notes or bills which are indorsed in blank; for these are equally transferable by delivery alone.
One having a general authority as agent, or a special authority unlimited as to time, may be presumed to possess that authority until there be notice of revocation.(g) This notice may be express, and proved by direct evidence; or it may be inferred from any circumstances, such as change of residence, or of business, or lapse of time, or of any other kind, always provided they are such as would suggest this revocation or cessation of authority to a man of ordinary intelligence and prudence.(h) So the notice may be direct to the party dealing with the agent, or general, by advertisement in a public paper, and then the knowledge of it must be brought home to
(e) Attwood v. Munnings, 7 B & C. 278. Bayley, J.: "This was an action upon an acceptance importing to be by procuration, and, therefore, any person taking the bill would know that he had not the security of the acceptor's signature, but of the party professing to act in pursuance of an authority from him. A person taking such a bill ought to exercise due caution, for he must take it upon the credit of the party who assumes the authority to accept, and it would be only reasonable prudence to require the production of that authority." Holroyd, J.: “The word 'procuration' gave due notice to the plaintiffs, and they were bound to ascertain, before they took the bill, that the acceptance was agreeable to the authority given.” Littledale, J.: “It is said that third persons are not bound to inquire into the making of a bill; but that is not so where the acceptance appears to be by procuration." See Withington v. Herring, 5 Bing. 442. In Alexander v. Mackenzie, 6 C. B. 766, it was held, that the acceptance or indorsement of a bill of exchange expressed to be " 'per procuration" is a notice to the indorsee that the party so accepting or indorsing professes to act under an authority from some principal, and imposes upon the indorsee the duty of ascertaining that the party so accepting or indorsing is acting within the terms of such authority. (f) Miller v. Race, 1 Burr. 452.
— v. Harrison, 12 Mod. 346, a servant had power to draw bills of exchange in his master's name, and afterwards was turned out of the service. Holt, C. J.: If he draw a bill in so little time after that the world cannot take notice of his being out of service, or if he were a long time out of his service, but that kept so secret that the world cannot take notice of it, the bill, in those cases, shall bind the master."
(h) See 1 Parsons on Cont. 58, et seq.
him by such reasonable evidence, as that he takes the paper, or reads it regularly, or was known to have examined that very paper.(h)
Death operates as a revocation of every agency or authority which is not coupled with an interest, and in that way vested in the agent. Even in that case, the death of the principal revokes the authority so far that the agent can no longer use the name of the principal, and must require the representatives of the deceased to act for him. But if the authority be one which the agent can execute in his own name, and be also coupled with an interest, it is unaffected by the death of the party. Whatever be the nature, ground, or extent of the authority to act for another in his name, we should say, on general principles, that his name, put to any negotiable paper, or indeed to any instrument, after his death, although in ignorance and good faith, was a nullity.()
One who purports to act as an agent, but who transcends. his authority, or has no authority, is, as we have seen, personally liable; but not as a party to the note or bill which he so signs, indorses, or accepts, if he signed expressly as agent; as. for example, "A, by B, his attorney." If B is not A's attorney, there is, strictly speaking, no signature to the note; and B is only liable for pretending to make a note when he did. But there are authorities which hold that here is a note, and some one must be held upon it, and, as A cannot be, B must be.(i)
(h) See 1 Parsons on Cont. 58, et seq.
(i) The authorities upon this point cannot be reconciled. In Polhill v. Walter, 3 B. & Ad. 114, it was held, that the defendant, who had accepted a bill for one Hancorne without authority, was liable in a special action on the case, but not as acceptor. This was upon the ground that no one can be liable as acceptor but the person to whom the bill is addressed. In Wilson v. Barthrop, 2 M. & W. 863, the defendant, who was the agent and clerk of a firm, drew a bill of exchange, and signed thereto the name of the firm. Held, that the defendant was not liable as the drawer in an action on the bill, his name not being affixed to it, without some proof that he had no authority to draw bills in the name of the firm, or that he had not acted bona fide. And quare, whether, if it had been proved that he had no such authority, he would have been liable in an action upon the bill. In Long v. Colburn, 11 Mass. 97, a promissory note was subscribed thus: Pro William Gill. J. S. Colburn." Held, that this was the promise of Gill, if Colburn had the authority to make it; and if not, that he would be liable to the promisee in a special action on the case In Ballou v. Talbot, 16 Mass. 461, the defendant made a promissory note, subscribed with his own name, but added to his signature the words, "agent for David Perry." Held, that the defendant was not liable
As a general rule, one who acts professedly as a public agent, and had authority so to act, is not liable, although the public fail to perform the contract, unless circumstances indicate that it was understood between him and the party dealing with him that the contract was made on his personal credit. As, for example, that an officer charged with the erection of some public building induced laborers to engage in it by his promise that their wages should be paid at all events, and whether funds were provided or not. So if he drew bills or gave notes for the public, but with
on the note. If he acted without authority from Perry, he was liable in a special action on the case. In Jefts v. York, 4 Cush. 371, the defendant made a promissory note beginning, "For value received, the pastor and deacons of Church, in behalf of said church, promise," &c. (Signed,) "S. D. York, agent for Church." Held, that the defendant was not personally liable on the note, though he gave it without authority. Bigelow, J. said: "It is impossible, upon any legal ground, to construe the instrument as the individual note of the defendant. Had it been a note of this tenor, I promise to pay A. B. one hundred dollars. S. D. York, agent for the Freewill Baptist Society,' it might be plausibly contended, that, if the agency was unauthorized, all the description of agent, &c. might be rejected, and the note be treated as the individual note of York. But the note is in no sense, and in no manner of reading it, a promissory note of York. In this instance, the body of the note contains the name of the promisor, who alone is the stipulated party to the promise contained in the note." See same case, 10 Cush. 392. In Grafton Bank v. Flanders, 4 N. H. 239, where A put the name of B to a promissory note without any authority from B, and the note was delivered to the payee for a valuable consideration, it was held, that under these circumstances the law would presume that A intended to bind himself; that he might so bind himself; and that he was liable in an action against him in his true name on the note, upon a count alleging that he made the note by the name of B. Sed quere. In Savage v. Rix, 9 N. H. 263, in an action on a promissory note, it was held, that if an agent, in making a contract, fail to execute it in such a manner as to bind his principal, but use apt words by which to make a contract for himself, whatever there may be which indicates that he might be an agent must be regarded as description, and he will be liable as on his own personal contract. In Dusenbury v. Ellis, 3 Johns. Cas. 70, the defendant, having no authority for the purpose, made a promissory note, beginning, “I promise," &c. (Signed,) "For Peter Sharpe, Gabriel Dusenbury, attorney." Held, that the defendant was personally liable on the note. The court said: "If a person, under pretence of authority from another, executes a note in his name, he is bound; and the name of the person for whom he assumed to act will be rejected as surplusage.” In Palmer v. Stephens, 1 Denio, 471, the defendant, without authority, made a promissory note, and signed thereto the name of Gideon Stephens, writing his own initials under the signature. Held, that the defendant was personally liable on the note. In Ormsby v. Kendall, 2 Ark. 338, the defendant gave a note, beginning, "Steamer Tecumseh and owners promise," &c. (Signed,) "F. C. Kendall." Held, that the defendant was personally liable on the note, unless he showed that he had authority to contract for the steamer and owners. See further, Roberts v. Button, 14 Vt. 195; Bank of Hamburg v. Wray, 4 Strobh. 87; Johnson v. Smith, 21 Conn. 627.
1 Parsons on Cont. 57, note f