Page:The New International Encyclopædia 1st ed. v. 01.djvu/250

AGENOR. the other sons settled in the countries which bore their names. See.

A'GENT (Lat. agens, acting, pres. part, of agere, to act). A modern term in English law. As a generic term, it includes every one author- ized to act for and represent another; but it is often used in a specific sense to denote one authorized to act for another in making con- tracts between that other, called the principal, and third persons. BlacUstone does not employ it, and it rarely occurs in law dictionaries, di- gests, or decisions before the nineteenth centurj'. For a time after its appearance it is used inter- changeably with the word servant. During the last century, however, the tendency of judges and law writers has been toward a complete dif- ferentiation of the terms "agent" and "servant." A fair illustration of the result is afforded by the following provisions of the California Civil Code: "An agent is one who represents another, called the principal, in dealings with third persons." "A servant is pne who is employed to render personal service to his employer, otherwise than in the pursuit of an independent calling, and who in sueli service remains entirely under the control and direction of the latter, who is called his master." Vsing "agent," then, to denote a person authorized to act for and represent an- other in business transactions with third per- sons, and reserving the rules relating to master and servant (q.v.) for a separate article, let us consider, ( 1 ) how agency is constituted, ( 2 ) the liability of the principal to third parties, (3) the liability of the agent to third parties, (4) the liabilities of principal and agent to each other, (5) the termination of agency.

(1.) Ordinarily, the relation of principal and agent originates in a contract (q.v.) between the parties, but it may exist without a contract, as Avhere A gratuitously undertakes to do .an act for B. The relationship may rest upon ratifica- tion, instead of a precedent agreement. For ex- ample: A does an act avowedly as B's agent,, without authority from B. The act does not bind B, unless he accepts it .as done on his be- half. If he does so accept it, his ratification is equivalent in law to a ])recedent appointment of A as agent. Even without appointing A or ratifying his acts, B may become liable for those acts, because his conduct induces third parties to liolieve that A is B's agent. In such a case there is agency by estoppel (q.v.). Still another form of agency is that which is created by the law. as where the law authorizes a wife to pledge her husljand's credit for necessaries. In the language of a learned judce. "the law cre- ates a compulsory agency, and her reqiiest is his request."

(2.) A principal who has authorized an agent to do an act for him, or has ratified the act, is liable to third per.sons preciselv as if the act had lieen done by him. As a rule, the principal is disclosed to the third party, and the latter un- derstands that the transaction is between them, the agent being a mere conduit for the transmis- sion of the iirincipal's consent. But even though the principal is not disclosed, nay, even though the third party may refuse to enter into a trans- action with the principal and maj' insist upon contracting with the agent as a principal, yet upon discovering that the transaction was for the principal's benefit and authorized by him, the third party may hold the principal liable. To this extraordinary liability of an undisclosed principal there are sundry limitations. If the third party has taken a written contract under seal or negotiable paper, duly executed by the .agent in his own name, he cannot sue the "prin- cipal on that instrument, because technical law permits only the parties to such a writing to be sued on it. Again, the third party may lose his right of action against an undisclosed principal by a final choice or election (q.v.) to hold the agent only; or by imdue delay in proceeding against the principal. The principal may be liable to third parties for his agent's acts which he has never authorized, or which he has even forbidden. His liability in such cases depends upon whether the acts were done within the scope of the agent's apparent autlioritj'; for the principal will not be allowed to show that he secretly forbade what he appears to have author- ized. What is the scope of an agent's authority depends upon the facts of the particular ease, including ordinary business usages relating thereto. As the agent is, in law, a mere con- duit of the principal's will, and thus identified with the principal, knowledge acquired by, or notice given to, the former during his agency, at least, is imputed to the latter. An exception to this rule exists where the agent acquires the knowledge or receives the notice in a transac- tion conducted by him in fraud of the principal. In such a case the agent cannot be exjjected to disclose his knowledge to the principal, and the legal fiction that the principal and agent are but one person will not be pressed so far as to work palpable injustice. It should be noted in this connection that when an undisclosed prin- cipal is liable to be sued by the third party, he is entitled, as a rule, to sue. This correlative right, however, he will not be allowed to enforce to the third party's injury. For example: any defense which the third party could have set up, had he been sued by the agent, he can interpose to an action by the principal.

(3.) An agent who discloses his principal incurs no liability to third parties if his acts are authorized or ratified and are lawful. From liability for unlawful acts he cannot screen himself by proving an express command of his principal, although such command renders the latter liable also. Every wrong-doer is personally responsible for his misfeasance. An agent will render himself liable on a written contract under seal, or on a negotiable instrument, if he executes it in his own name, although he intends to bind his principal thereby. In order to bind the principal, such an instrument nmst be in his name, and purport to be his deed, or note, or bill. In the case of other written contracts, the agent who discloses his principal will not be bound, unless the intention of the parties that he should be bound is apparent from the writing and attendant circumstances. The agent may render himself liable to the third party by assuming to act for a principal witlioul authority.

(4.) In the absence of express stipulations in the contract to the contrary, the principal is under obligation to compensate the agent for his services; to reimburse him for all proper expenditures on the principal's behalf, and to indemnify him against the consequences of authorized acts which he did not know, or which he was not bound to know, were unlawful. On the other hand, the agent is under obligation to act with the iitmost good faith toward the principal, obeying his instructions, advancing his