SECTION 1250. When exclusive credit is given to agent.

1251. Rights of person who deals with agent without knowledge
of his agency.

1252. Effect of a written instrument by which the agent interds
to bind the principal.

1253. Principal's responsibility for agent's negligence or omission.
1254. Principal's responsibility for wrongs willfully committed by
the agent.

S1245. An agent represents his principal for all purposes within the scope of his actual or ostensible1 authority, and all the rights and liabilities which would accrue to the agent from transactions within such limit, if they had been entered into on his own account, accrue to the principal.

'Rourke v. Story, 4 E. D. Smith, 54; Hatch v. Taylor,

10 N. H., 538; Farm. & M. B'k v. Butch. & Drov.

when

bound by

S1246. A principal is bound by an incomplete exe- Principal, cution of an authority, when it is consistent with the whole purpose and scope thereof, but not otherwise. execution

Story Agency, SS 171, 180.

S1247. As against a principal, both principal and agent are deemed to have notice of whatever

either has notice of, and ought, in good faith and the exercise of ordinary care and diligence, to communicate to the other.3

'Fulton Bank v. Sharon Canal Co., 4 Paige, 137; Bank

of U. S. v. Davis, 2 Hill, 464; Stewart v. Stewart, 6
Clark & Fin., 911. See Ingalls v. Morgan, 10 N. Y.,
184; Weisser v. Denison, id, 68.

This rule has been declared in a well considered opinion
(Fitzsimmons v. Joslin, 21 Vt., 129), and seems to be
supported by other cases (see Lawrence v. Miller, 16
N. Y., 235; Fuller v. Wilson, 3 Q. B., 58). To the
contrary is the celebrated case of Cornfoot v. Fowke
(6 M. & W., 386), which has been, however, explained
in the house of lords (National Exch. Co. v. Drew, 2
Macq., 108, 144) as really turning upon a question of
pure fraud.

incomplete

of authority

Notice to notice to

agent, when

principal.

Obligation of principal

exceeds his

authority.

See Weisser v. Denison, 10 N. Y.. 68; Hood v. Fahnestock, 8 Watts, 489; Bracken v. Miller, 4 Watts & S., 102. Thus, notice to an agent, before his employment as such, does not affect the principal (Fuller v. Bennett, 2 Hare, 402; Worsley v. Scarborough, 3 Atk., 392; and cases before cited).

S1248. When an agent exceeds his authority, his

when agent principal is bound by his authorized acts so far only as they can be plainly separated from those which are unauthorized.

For acts

done under a merely ostensible authority.

When exclusive cre

§ 1249. A principal is bound by acts of his agent, under a merely ostensible authority, to those persons only who have in good faith, and without ordinary negligence, incurred a liability, or parted with value, upon the faith thereof.

See Mechanics' Bank v. New Haven R. R., 13 N. Y., 611;
Farmers' and Mechanics' Bank v. Butchers' and Drovers'
Bank, 16 N. Y. 127

$1250. If exclusive credit is given to an agent by dit is given the person dealing with him, his principal is exonerat

to agent.

Rights of person who deals

agent with ledge of his

out know.

agency.

ed by payment or other satisfaction made by him to his agent in good faith, before receiving notice of the creditor's election to hold him responsible.

Story Agency, § 291; Fish v. Wood, 4 E. D. Smith, 327; see Heald v. Kenworthy, 10 Exch., 739; Hyde v. Paige, 9 Barb., 150; Cheever v. Smith, 15 Johns., 276; French v. Price, 24 Pick., 13; Fitler v. Commonwealth, 31 Penn. St., 406. If such credit is not given to the agent, mere delay in calling upon the principal does not exonerate him (Macfarlane v. Giannacopulo, 3 H. & N., 860).

1251. One who deals with an agent, without knowing or having reason to believe that the agent acts as such in the transaction, may set off, against any claim of the principal arising out of the same, all claims which he might have set off against the agent before notice of the agency.

Hogan v. Shorb, 24 Wend., 458; George v. Clagett, 7 T. R., 359; see Taintor v. Prendergast, 3 Hill, 72; Ferrand v. Bischoffsheim, 4 C. B. (N. S.), 710; Heald v. Kenworthy, 10 Exch., 739; Smethurst v. Mitchell, 1 EL & El., 630.

written in

by which

S1252. Any instrument within the scope of his Effect of a authority, whether under seal or not, by which an agent intends to bind his principal, does bind him, if such intent is plainly inferable from the instrument itself.

This section belongs perhaps to the general subject of
interpretation of contracts. It is intended to abolish
the distinction in this respect between sealed and un-
sealed instruments. See Story Ag., §§ 147-155.

strument the agent bind the

intends to

principal.

responsi

bility for ligence or

agent's neg

omission.

S 1253. Unless required by or under the authority Principal's of law to employ that particular agent,' a principal is responsible to third persons for the negligence of his agent in the transaction of the business of the agency, including wrongful acts committed by such agent in, and as a part of, the transaction of such business; and for his willful omission to fulfill the obligations of the principal.*

Sadler v.

Drew v. Sixth Av. R. R. Co., 26 N. Y., 49;
Henlock, 4 E. & B., 570; Althorf v. Wolfe, 22 N.
Y., 355; Blake v. Ferris, 5 N. Y., 48.

Chase v. N. Y. Central R. R. Co., 26 N. Y., 523; San-
ford v. Eighth Av. R. R. Co., 23 N. Y., 343; see
Griswold v. Haven, 25 N. Y., 595.

Weed v. Panama R. R., 17 N. Y., 362; Story Agency,
§ 453.

responsi

wrongs

S1254. A principal is responsible for no other Principal's wrongs committed by his agent, than those men- bility for tioned in the last section, unless he has authorized willfully or ratified them,' even though they are committed by the while the agent is engaged in his service.2

'Steele v. Smith, 3 E. D. Smith, 321; Eastern C. R. R.

v. Brown, 6 Exch., 314; Chilton v. Croydon R. R.,
16 M. & W., 212; Maund v. Monmouth Canal Co., 4
M. & G., 452.

Story Ag., 456; Church v. Mansfield, 20 Conn., 284;
Condit v. Baldwin, 21 N. Y., 219; Richmond Turn-
pike Co. v. Vanderbilt, 2 N. Y., 479; 1 Hill, 480;
Fellows v. Com'rs of Oneida, 36 Barb., 655.

committed

agent.

Warranty of author

ity.

Agent's responsibility to third persons.

ARTICLE IV.

OBLIGATIONS OF AGENTS TO THIRD PERSONS.

SECTION 1255. Warranty of authority.

1256. Agent's responsibility to third persons.

1257. Obligation of agent to surrender property to third person. 1258. Agent not having capacity to contract.

S1255. One who assumes to act as an agent thereby warrants, to all who deal with him in that capacity, that he has the authority which he assumes. White v. Madison, 26 N. Y., 117; Collen v. Wright, 8 E. & B., 647; 7 id., 301; see Walker v. Bank of N. Y., 9 id., 582; Jenkins v. Hutchinson, 13 Q. B., 744; Jefts v. York, 10 Cush., 395; Polhill v. Walter, 3 B. & Ad., 114. The exception established in Smout #. Ilbery (10 M. & W., 1), is not necessary to be retained, under the change which is proposed as to the termination of agency.

S 1256. One who assumes to act as an agent is responsible to third persons as a principal for his acts in the course of his agency, in any of the following cases, and in no others :'

1. When, with his consent, credit is given to him personally in a transaction;2

2. When he enters into a written contract in the name of his principal, without believing, in good faith, that he has authority to do so; or,

3. When his acts are wrongful in their nature.*

1

Story's Agency, §§ 261, 310. See Kirkpatrick v. Stainer, 22 Wend., 244; Green v. Kopke, 18 C. B., 549; Smout v. Ilbery, 10 M. & W., 1.

Sto. Ag., § 288. This provision includes the cases in which an agent does not disclose the fact of his agency (Waring v. Mason, 18 Wend., 434; Sto. Ag, § 266); those in which the fact of the agency is known, but the principal is unknown (Mills v. Hunt, 20 Wend., 431; Sto. Ag., § 267); or where the agent makes himself a party to the contract (Higgins v. Senior, 8 M. & W., 834; Tanner v. Christian, 4 E. & B., 591; Lennard v. Robinson, 5 E. & B., 125; Pentz v. Stanton, 10 Wend., 271). In all cases the question is, "to whom was the credit given?" (Green v.

Kopke, 18 C. B., 549; Mahony v. Kekulé, 14 id.,
390. See Kirkpatrick v. Stainer, 22 Wend., 244).
This is true even concerning public agents who con-
tract in their own names (Sto. Ag., § 302).
This rule seems to be established in this state (Feeter
v. Heath [Ct. of Errors], 11 Wend., 477; Meech v.
Smith, 7 Wend., 315; Dusenbery v. Ellis, 3 Johns.
Cas., 70; Rossiter v. Rossiter, 8 Wend., 494; see
Palmer v. Stephens, 1 Denio, 471); though it is con-
fined to the limits here stated (Walker v. Bank of
N. Y., 9 N. Y., 582); and has been doubted altogether
(White v. Madison, 26 N. Y., 117). It is not law in
England (Collen v. Wright, 7 E. & B, 301; Jenkins
v. Hutchinson, 13 Q. B., 744; Lewis v. Nicholson,
18 id., 503), in Massachusetts (Abbey v. Chase, 6
Cush., 56; Jefts v. York, 4 id., 371; Ballou v. Talbot,
16 Mass., 461; Long v. Colburn, 11 id., 97), in Con-
necticut (Ogden v. Raymond, 22 Conn., 385), in
Maine (Harper v. Little, 2 Greenl., 14; Stetson v.
Patton, id., 358), in Indiana (McHenry v. Duffield, 7
Blackf., 41), or Pennsylvania (Hopkins v. Mehaffey,
11 Serg. & R., 126).

Sto. Ag., §§ 311, 312. The maxium respondeat superior
does not exempt the agent from liability even for
mere negligence (Arthy v. Coleman, 30 Law Times,
101; 8 E. & B. [Am. ed.], 1092).

S 1257. If an agent receives anything for the benefit of his principal, to the possession of which another person is entitled, he must, on demand, surrender it to such person, or so much of it as he has under his control at the time of demand, on being indemnified for any advance which he has made to his principal, in good faith, on account of the same; and is responsible therefor, if, after notice from the owner, he delivers it to his principal.

1 Story's Agency, § 300.

2 Hearsey v Pruyn, 7 Johns., 179.

S1258. The provisions of this article are subject to the provisions of Part I of the First Division of this Code.