consignment the agent is indebted to his principal on the general balance of account to a greater amount than the value of the goods, and if such consignment has been made in order to cover his balance.1 Nor does this right exist if the agent is only a surety for the price of the goods.2 The right of stoppage in transitu may be exercised either by obtaining actual possession of the goods, or by giving notice of the claim to the person in whose custody they are during the transit.3 CHAPTER VI. [379]. RIGHT OF AGENT AGAINST THIRD PARTIES. SECT. 1. Upon Contracts. An agent is entitled to bring an action against third persons upon contracts to which they are parties (1) Where the agent has contracted personally. (2) In certain cases where the agent is the real principal. (3) Where the agent has a special interest in the subjectmatter of the contract. (4) In some cases where money is paid on contract which turns out to be illegal, or where it is paid by mistake. Firstly. Where the agent has contracted personally. It is a well-established rule of law that when a contract not under seal is made with an agent in his own name, for an undisclosed principal, either the agent or the principal may sue upon it,' the defendant, in the latter case, being 1. Wiseman v. Vandeputt, 2 Vern. 203; Vertue v. Jewell, 4 Camp. 31. 2. Siffken v. Wray, 6 East, 371. 3. Northey v. Field, 2 Esp. 613; Litt v. Cowley, 7 Taunt. 169. See Newhall v. Vargas, 13 Me. 93; Mottram v. Heyer, 5 Den. 629. 1. See ante; Taintor v. Prendergast, 3 Hill, 72; Huntington v. Knox, 7 Cush. 371; Chandler v. Coe, 54 N. H. 561; Culver v. Bigelow, 43 Vt. 249; Saladin v. Mitchell, 45 Ill. 79. entitled to be placed in the same position, at the time of the disclosure of the real principal, as if the agent had been the real contracting party. Secondly. Where the agent is the real principal. The mere fact that the agent has contracted as agent will not disentitle him to sue.2 Thirdly. When the agent has a special interest.3 Fourthly. When money is paid by mistake or under illegal contract.1 Where the agent sues in his own name the defendant may avail himself of all defenses which would be good at law and in equity.5 SECT. 2. Rights of agent against third parties in tort. Any special or temporary ownership of goods, with immediate possession, is sufficient to maintain an action for conversion." A factor, or a bailee, or any other person with a right of his own, however special or trivial, has a property sufficient for the purposes of this action, and as against a mere wrongdoer, may recover the whole value of the property, being accountable over to the general owner." 2. Raynor v. Grote, 15 M. & W. 359. 3. Whitehead v. Potter, 4 Ired. Law, 357; Murray v. Toland, 3 Johns. Ch. 569; Toland v. Murray, 18 Johns. 24. 4. Stevenson v. Mortimer, Cowp. 805. 5. See post. One who is simply employed to sell goods and pay over to his employer the money received from the sales, has no authority to exchange such money with a third person; and, if he does so, and receives in exchange a counterfeit bill, he may maintain an action in his own name to recover back the money paid out him for it; and it is not necessary, before bringing such action, to offer to return the counterfeit bill. Kent v. Bornstein, 12 Allen, 342. See, also, Hungerford v. Scott, 37 Wis, 341, where an action by a steamboat agent to recover from a purchaser the difference between the price received by him and the schedule price of tickets sold, which he had paid to the company, the tickets being sold by the agent by mistake for less than the schedule price, was held not to lie. 6. Legg v. Evans, 6 M. & W. 36. See this subject fully considered in Cooley on Torts, pp. 442-447. 7. Cooley on Torts, 447; Edwards on Bailments, §§ 37, 69, 103 et seq., 329. CHAPTER VII. [395]. THE RIGHTS OF THE PRINCIPAL AGAINST THIRD PARTIES. SECT. 1. The right to sue on contracts of agent. Those acts or contracts of an agent which render the principal liable to third parties impose upon the third parties themselves a reciprocal obligation to the principal; and the principal may enforce those rights by action.1 The right of the principal to sue is paramount to that of the agent, and in cases where either may bring an action, the former, by giving notice to the other contracting party, puts an end to the agent's right of action, except in cases where the agent has a lien upon the subject-matter of the action equal to the claim of the principal.2 SECT. 2. The right of the principal to recover money wrongfully paid or applied. Where a man pays money by his agent which ought not to have been paid, either the agent or [405] his principal may bring an action to recover it back. The agent may, from the authority of the principal; and the principal may, as proving it to have been paid by his agent.3 SECT. 3. The right of the principal to follow property wrongfully conveyed or its proceeds. Whenever the property of a party has been wrongfully misapplied, or a trust fund has [406] been wrongfully converted into another species of property, if its identity can 1. See Conklin v. Leeds, 58 Ill. 178; Barber V. Garvey, 83 id. 184; Machias Hotel Co. v. Coyle, 35 Me. 405. Otherwise, if the contract is under seal. Briggs v. Partridge, 64 N. Y. (anno. reprint) 357. 2. See Taintor v. Prendergast, 3 Hill, 72, and Sadler v. Leigh, 4 Camp. 195. 3. Sadler v. Evans, 4 Burr. 1984; Stevenson v. Mortimer, Cowp. 805; Farmers' & M. Bank v. King, 57 Penn. St. 202. be traced, it will be held, in its new form, liable to the rights of the original owner or cestui que trust.* SECT. 4. The right to rescind contracts affected by fraud.5 Any surreptitious dealing between one principal and the agent of another principal is a fraud upon the latter of which courts of equity will take cognizance. [439] CHAPTER VIII. LIABILITY OF PRINCIPAL TO THIRD PARTIES. [440] SECT. 1. On contracts of agent.1 A principal is liable to third parties for whatever the agent does or says; whatever contracts, representations or admissions he makes; whatever negligence he is guilty of, and whatever fraud or wrong he commits, provided the agent acts within the scope of his [real or] apparent au 4. Story, Eq. Jur. § 1258 et seq. If an agent mingles his principal's money with his own, so that it cannot be followed, the principal can not recover it specifically. But the agent does not convert himself into a mere debtor; the principal may claim from the admixture the sum which belonged to him. Farmers' and M. Bank v. King, 57 Penn St. 202. See School District v. First Nat. Bank, 102 Mass. 174. 5. As to revocation of the agent's authority by his fraudulent acts, see ante. See 2 Story Eq. Jur. §§ 794-8, where it is stated that "compensation or damages, it would seem, ought ordinarily to be decreed in equity only as incidental to other relief sought by the bill, and granted by the court, or where there is no adequate remedy at law; or where some peculiar equity intervenes." Where, however, specific performance is impossible for the reason that the title is defective, or the vendor has incapacitated himself from performing the contract, compensation may, as it seems, be decreed. See Greenaway v. Adams, 12 Ves. 401; Woodcock v. Bennett, 1 Cow. 711; Milkman v. Ordway, 106 Mass. 232. See, however, contra, cases cited in note to Evans Agency (Ewell's ed.), 574-575. 1. The subjects treated in this chapter have already been considered ante, and hence further treatment here is unnecessary. The student may, however, read with profit the discussion of the cases in the original text, p. 576 et seq., Ewell's edition. thority, and provided a liability would attach to the principal if he was in the place of the agent." But the agent alone is liable in the following cases: Where he covenants personally in instruments under seal.3 Where he contracts personally in negotiable instruments.* Where exclusive credit is given to the agent, the principal being known. Where an agent commits a wilful wrong. Although, however, a principal cannot by secret limitations of an agent's apparent authority free himself from liability upon contracts of the agent based upon his apparent authority, yet this rule will have no operation where the third party has notice that the agent is acting in violation of his instructions.5 SECT. 2. For fraud and misrepresentation of agent. A principal is answerable [to third parties] where he has received a benefit from the fraud of his agent, acting within the scope of his authority, or where the fraud was committed by the agent in the course of his principal's business and for his benefit." SECT. 3. Liability of principal for agent's acts and negligence. A principal, master or employer is liable to third parties for results due to the agent's acts and negligence when he is acting within the scope of his authority; but if the agent or servant is not acting within the [real or apparent] scope of his employment the employer is not liable for his negligence. 2. See Holmes v. Mather, L. R., 10 Ex. 261. To the same point, see N. Y. Life Ins. Co. v. McGowan, 18 Kan. 300: Mass. Life Ins. Co. v. Eshelman, 30 Ohio St. 647; Planters' Ins. Co. v. Sorrells, 57 Tenn. 352; Noble v. Cunningham, 74 Ill. 51; Bass v. C. & N. W. R'y Co., 42 Wis. 654. Consider, also, ante. 3. Considered ante. 5. See Howard v. Brouthwaite, 1 Ves. & B. 209. 6. See Allerton v. Allerton, 50 N. Y. (anno. reprint) 670; Big. L. Com. Torts, 23 et seq. 7. The test of the master's responsibility is not the motive of the ser |