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Chap. V. Agency, how created;

(1) by express

contract:

(2) by implication.

Husband and wife.

(3) from necessity.

Master of ship.

CHAPTER V.

SALES, PURCHASES, AND PLEDGES BY AGENTS (a).

THE relation of principal and agent may be created-
(1) By express contract, which may be either written or
without writing (b), even if the agent be appointed
to sign a contract under the 4th section of the Statute
of Frauds (c), or the 4th section of the Sale of Goods
Act, 1893 (d).

An agent appointed to execute a deed for another must be appointed by deed (called a power of attorney (e)).

(2) By implication, where a person is placed in such a position that, according to the ordinary usage of mankind, he would be understood to act for and represent the principal (ƒ).

For example, if a man puts goods into the custody of another whose common business is to sell such goods, he gives him implied authority to sell them, unless he limits his authority (g).

Also, a wife has in many cases an implied authority to pledge her husband's credit (h).

(3) From the necessity of the case.

On this principle, where the master of a ship (i) cannot communicate with the owner or his agent (k), he may contract for the necessary repairs of the ship (1) and other necessaries for the ship, and may raise money necessary for the prosecution of the voyage (m), and for these purposes may pledge the credit of

(a) See as to contracts by agents gene-
rally, Leake, Contr., Part II., Ch. 2,
sect. 1; Pollock, Contr., 100 et seq.

(b) Mortlock v. Buller, 10 Ves. 311; 7
R. R. 417; Heard v. Pilley, 4 Ch. 548.
(c) 29 Car. 2, c. 3; Emmerson v. Heelis,
2 Taunt. 38; Acebal v. Levy, 10 Bing.
378.

(d) Formerly s. 17 of the Statute of
Frauds.

(e) M. L. R. P. 288; Shep. Touch. 57.

(f) Pole v. Leask, 33 L. J. Ch. 155.

(g) Pickering v. Busk, 15 East, 38; 13 R. R. 364.

(h) See Debenham v. Mellon, 6 App. Cas. 24, and notes to Manby v. Scott, 2 Sm. L. C. 450.

(i) See Chap. v. p. 124.

(k) Gunn v. Roberts, L. R. 9 C. P. 331.

(1) Webster v. Seekamp, 4 B. & Ald. 352; 23 R. R. 307.

(m) Beldon v. Campbell, 6 Ex. 886; Arthur v. Barton, 6 M. & W. 138; The Mariposa, [1896] P. 273.

the shipowner. A wife living apart from her husband may in Chap. V. some cases pledge his credit for necessaries (n).

cation.

(4) By ratification. If A., unauthorized by B., makes a (4) by ratificontract on his behalf with C., which contract B. subsequently adopts, A. becomes B.'s agent ab initio.

In this case, if C. entered into the contract believing that he was contracting with B., and B. subsequently admits that such is the case, C. is precisely in the position in which he intended to be. If C. intended to contract with A., he retains his remedy against him, and is not injured by the ratification (o). B. may ratify an acceptance by A. of an offer by C., even though C. has endeavoured to withdraw the offer before the ratification (p). B. cannot, however, ratify a contract which A., without authority, intended to make on his behalf, if A. did not at the time of making the contract profess to act on behalf of a principal (q).

There is a distinction between an agent who has a general authority to do things of a certain nature and one who is cmployed pro hac vice, who is, in other words, a special agent.

An agent of the former class has the right to do all acts which are incident to his general authority; and, unless the person dealing with him has notice that his authority is limited, i.e., that he has no authority to do some of these acts, the principal is bound by such acts of the agent (r). On the other hand, a special agent with only a limited authority cannot bind his principal by an act beyond the scope of his authority (s).

For example, if a horse-dealer having a horse to sell directs his salesman to sell it, but not to warrant it, and the salesman warrants it, the master will be bound by the warranty, because the salesman is acting within the general scope of his authority; and the public cannot be supposed to be cognizant of any private communication between his master and him (t). But if a private

(n) See notes to Manby v. Scott, 2 Sm. L. C. 450, 492.

(0) Bird v. Brown, 4 Ex. 786; Maclean v. Dunn, 4 Bing. 722; 29 R. R. 714.

(p) Bolton v. Lambert, 41 Ch. D. 295; Re Portuguese Mines, 45 Ch. D. 16.

(2) Keighley v. Durant, [1901] A. C. 240; Boston Fruit Co. v. British, &c. Co., [1906] A. C. 336, 343.

(1) Collen v. Gardner, 21 Beav. 540; Smith v. M'Guire, 3 H. & N. 554; Watteau v. Fenwick, [1893] 1 Q. B. 346; Rainbow v. Howkins. [1904] 2 K. B. 322. (8) Fenn v. Harrison, 3 T. R. 757; Attwood v. Munnings, 7 B. & C. 278; 31 R. R. 194.

(t) Howard v. Sheward, L. R. 2 C. P. 148.

"General
and "special"

agent.

Chap. V.

Agent to sign

contract.

Agent contracting in his own name.

Auctioneer.

person, being the owner of a horse, directs his servant to sell the horse, but not to warrant him, and he does warrant him, the owner is not bound, because the servant was not acting within the scope of his authority (u).

When an agent, either general or special, has authority to sell, he has authority to make the contract for sale binding; and therefore, in cases falling within s. 4 of the Sale of Goods Act, 1893 (x), he can sign a note in writing of the contract so as to bind his principal.

Authority may be given to sign a note of a contract already made, without giving authority to make a contract, or to vary one already made. This distinction is of importance where an error is made in reducing the contract into writing. In such cases, if the agent has authority to make a contract, the writing containing the mistake is the note of a contract within the authority of the agent, and the principal is bound by it; but where the authority is only to sign the note of a particular contract, the writing containing the mistake is not one that the agent is authorized to sign, and therefore the principal is not bound by it (y). One of the parties to a contract cannot be the agent of the other for the purpose of signing it (z).

Where a man who is in fact an agent contracts in his own name without qualification he is a contracting party (a); but, if words are used which plainly show that he is contracting not for himself but for someone else, effect will be given to them whether they are contained in the body of the instrument or are annexed to his signature (b).

An auctioneer (c) is a person employed by the vendor as his agent to sell, and therefore to sign the contract for sale, on his behalf. The highest bidder at the sale by the act of bidding (d) constitutes the auctioneer his agent for the purpose of signing the contract contained in the written conditions of sale. The auctioneer's clerk may be, and very often is, the agent of the

(u) Brady v. Todd, 9 C. B. N. S. 592. (x) 56 & 57 Vict. c. 71. Formerly s. 17 of the Statute of Frauds.

(y) Blackburn on Sale, 77, 78.

(z) Sharman v. Brandt, L. R. 6 Q. B. 720. See the rule doubted in Blackburn on Sale, 76.

(a) Higgins v. Senior, 8 M. & W. 844; 58 R. R. 884.

(b) Fairlie v. Fenton, L. R. 5 Ex. 169; Gadd v. Houghton, 1 Ex. D. 357; Repetto v. Millar's, [1901] 2 K. B. 306. See notes to Thomson v. Davenport, 2 Sm. L. C. 389, 396.

(c) Ante, p. 60.

(d) Emmerson v. Heelis, 2 Taunt. 38; 11 R. R. 520; White v. Proctor, 4 Taunt. 209; 13 R. R. 580.

purchaser to sign for him (e). The signature must be at the Chap. V. time of the sale and not afterwards (f).

The owner may withdraw the property (g), and the bidder may withdraw his bid, which is a mere offer (h), at any time before the bargain is concluded by the fall of the hammer.

In order to make a valid memorandum of the contract within s. 4 of the Sale of Goods Act, 1893, the document which the auctioneer signs must contain all the terms of the contract; so that, if he simply writes down the name of the purchaser and the price in a book which does not incorporate the conditions, it is not sufficient (i). Each lot is primâ facie the subject of a separate contract for sale (k).

Where a sale of goods by auction is not expressed to be subject to a reserve price, or to the right of the seller to bid, it is not lawful for him or any person authorized by him (who is called a puffer) to bid (1). But the sale may be expressly made subject to a reserve price or to the right of the seller or a puffer to bid (m).

An auctioneer who sells goods in the ordinary way, generally has the possession of them, and is liable as a bailee (n). He can sue for the price in his own name (o), and has a lien for the purchase-money (o); his authority is to receive payment in cash only (p). If the goods do not belong to the vendor, the auctioneer is liable, as for a conversion of the goods, at the suit of the real owner (q).

A broker for sale is a person having authority both from buyer Brokers.

(e) Peirce v. Corf, L. R. 9 Q. B. 210; Sims v. Landray, [1894] 2 Ch. 318; Bell v. Balls, [1897] 1 Ch. 663.

(f) Meus v. Carr, 1 H. & N. 484; Bell v. Balls, sup.

(g) Warlow v. Harrison, 1 E. & E. 295; Rainbow v. Howkins, [1904] 2 K. B. 322.

(h) Payne v. Cave, 3 T. R. 148; 1 R. R. 679; Sale of Goods Act, 1893, s. 58 (2).

(i) Hinde v. Whitehouse, 7 East, 558; 8 R. R. 676; Peirce v. Corf, L. R. 9 Q. B. 210; Kenworthy v. Schofield, 2 B. & C. 945; 26 R. R. 600; Rishton v. Whatmore, 8 Ch. D. 467.

(k) Emmerson v. Heelis, 2 Taunt. 38; 11 R. R. 520; Roots v. Dormer, 4 B. &

Ad. 77; 38 R. R. 231; Sale of Goods
Act, 1893, s. 58 (1).

(1) Bexwell v. Christie, Cowp. 395;
Crowder v. Austin, 3 Bing. 368; 28
R. R. 646; Green v. Baverstock, 14 C. B.
N. S. 204; Sale of Goods Act, 1893,
s. 58 (3).

(m) Ib. s. 58 (4).
(n) Ante, p. 23.

(0) Williams v. Millington, 1 H. Bl. 81; 2 R. R. 724; Woolfe v. Horne, 2 Q. B. D. 355; Hindle v. Brown, 98 L. T. 44, 791. See notes to Thomson v. Davenport, 2 Sm. L. C. 415.

(p) Pape v. Westacott, [1894] 1 Q. B.

272.

(4) Consolidated Co. v. Curtis, [1892] 1 Q. B. 495.

Chap. V. and seller to sign a memorandum of the bargain so as to make the contract good against each (r). He also finds buyers and sellers and negotiates between them (s). In many cases he is originally employed by one party with special instructions as to price; and, in these cases, though he cannot act as the agent of the other party in fixing the price, there is no objection to his acting for both parties in seeing that they understand the contract and that it is made binding (t), or to his signing for the party who did not employ him to fix the price if authorized by him to do so (u). A broker has neither the custody nor the possession of the goods to be sold (v); nor can he sue in his own name on a contract made by him as a broker (x), unless in fact he had no principal (y).

Custom of the market.

As a general rule, a person employing a broker must be taken to have authorized him to act as brokers generally act; and the person who treats with a broker has a right to assume that he has such authority, and to consider the principal bound by all acts falling within such authority (z). If a principal wishes to limit the authority of a broker, so as not to authorize him to do the acts generally done by brokers, he must give notice of such limitation to the other person with whom he wishes to contract through the broker.

The authority of the broker may depend upon the custom of the trade, which had originally to be ascertained by evidence (a); but, when a trade has been long established, its customs will be taken judicial notice of (b).

Where a principal employs a broker to buy or sell for him in a market of the usage of which he is ignorant, he authorizes him to make a contract upon the footing of such usages as are reasonable and do not alter the character of the contract, but not on the footing of unreasonable usages (c). If, however, he knows the usage, he is bound by it even if it be unreasonable (c).

(r) Blackburn on Sale, 83.

(8) Janssen v. Green, 4 Burr. 2103;
Smith v. Lindo, 4 C. B. N. S. 395; Scott
v. Jackson, 19 Id. 134.

(t) Blackburn on Sale, 83, 84.
(u) See Thompson v. Gardiner, 1 C. P.
D. 777.

(r) Baring v. Corrie, 2 B. & Ald. 137;
20 R. R. 383.

(x) Fairlie v. Fenton, L. R. 5 Ex. 169.

(y) Harper v. Vigers, [1909] 2 K. B.

549.

(z) Heyworth v. Knight, 17 C. B. N. S. 298.

(a) See Scott v. Godfrey, [1901] 2 K. B. 726.

(b) Brandao v. Barnett, 12 Cl. & F. 787. (c) Robinson v. Mollett, L. R. 7 H. L. 802; Perry v. Barnett, 15 Q. B. D. 388. See notes to Wigglesworth v. Dallison, 1 Sm. L. C. 552, 565 et seq.

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