Art. 8. Principal and Agent. ARTICLE VIII. PRINCIPAL AND AGENT. SUBDIVISION 1. Powers and liabilities of agents. 2. Liability of principal for tortious acts of 3. Rights of principal as against agent. ... PAGE. 96 97 100 .. 101 SUBDIVISION 1. Powers and Liabilities of Agents. An agent in possession, or entitled to possession of his principal's property has an action against a third person who injures or converts it. Tuthill v. Wheeler, 6 Barb. 362; Faulkner v. Brown, 13 Wend. 63. Where an agent has an action for injury to his principal's property he may recover the full damage. Mechanics & Traders' Bank v. Farmers & Mechanics' Nat. Bank, 60 N. Y. 40. An agent is always liable to third persons for his misfeasance. Crane v. Onderdonk, 67 Barb. 47. An agent committing conversion is liable where his principal is liable, even though the agent acted innocently and in good faith, relying on his principal's right. Spraights v. Hawley, 39 N. Y. 441. An agent is not liable for false representations as to facts not peculiarly within his knowledge where he gives the sources of information and assumes no responsibility personally. Griffing v. Diller, 50 St. Rep. 435, 21 N. Y. Supp. 407. Where the agent fails to perform a duty which the principal owed to a third person, the remedy of such person is against the principal, not the agent. Denny v. Manhattan Co., 5 Den. 639; Phinney v. Phinney, 17 How. Pr. 197. An agent is not liable to third persons for an omission or neglect of duty in the matter of his agency, but the principal is alone responsible. Colvin v. Holbrook, 2 N. Y. 126; Hall v. Lauderdale, 46 N. Y. 70. Art. 8. Principal and Agent. SUBDIVISION 2. Liability of Principal for Tortious Acts of Agent. The relation of principal and agent is nearly, yet not absolutely identical with that of master and servant. Bishop, § 696. As a servant is liable for his own torts, so also is one who is termed agent. Thus if he assists a principal in a breach of trust he is personally responsible. Bishop, § 695. As to the difficulty of distinguishing between the rules governing principal and agent from those governing master and servant, Bigelow on Torts (7th ed.), p. 39, says: * "Closely allied to master and servant, for the purposes under consideration, is the relation of principal and agent. It is sometimes put as a distinction between the two relations, that a servant can exercise no independent discretion, but is subject at all times to the control and direction of the master, while an agent acts largely upon his own discretion; but the distinction will not bear examination. * The real difference is in the kind of discretion to be exercised; an agent, while, like a servant, subordinate to and independent of his employer, is employed to make contracts for his principal. That makes a fundamental difference; but it does not bring about any special result in regard to the principal's liability for his agent's torts. The liability of a principal is the same as that of a master, whatever the tort." As to the liability of the principal for misrepresentations made by the agent, Fraser on Law of Torts (5th ed.), 153, says: "The agent himself is personally liable according to the general rules governing law as to fraud. The liability of the principal depends on several considerations." The liability of the principal is then tabulated in the form of rules governing all circumstances. "In order that responsibility may attach to the principal in respect to a tort committed by his agent, it is necessary: (1) That such principal authorized the commission of the tort in the first instance; or (2) That he has made it his own by adoption or ratification; or (3) That the tort was committed by the agent in the course and as part of his employment. As a general rule a principal is not liable for the torts of his agent except upon some one of the grounds mentioned above." It follows, from the principles of agency, coupled with the doc Art. 8. Principal and Agent. trine that each partner is the agent of the firm for the purpose of carrying on its business in the usual way, that an ordinary partnership is liable in damages for the negligence of any one of its members in conducting the business of the partnership. As a rule, however, the willful tort of one partner is not imputable to the firm. For example, if one partner maliciously prosecutes a person for stealing partnership property, the firm is not answerable, unless all the members are, in fact, privy to the malicious prosecution. Newell on Malicious Prosecution, § 103. A principal whose negligence has enabled his agent to cheat a third person acting with ordinary caution is universally estopped from denying the authority of the agent. 2 Addison on Torts, 1178. But a party who claims the benefit of this estoppel must show that he has acted in the transaction in which he was deceived with ordinary caution. 2 Addison on Torts, 1179. If a fraudulent act has been committed by the agent without knowledge of the principal, and the latter afterward adopts the act and takes the benefit of the fraud, he will be responsible in damages to the person who has been deceived or injured by the fraudulent act. 2 Addison on Torts, 1036, citing Wright v. Crookes, 56 N. Y. 39. But if he repudiates the transaction as soon as he becomes acquainted with the fraud, he will not be responsible for the fraud if it was committed by the agent without his sanction or authority, and the representations are not within the ordinary scope of the authority of an agent acting in such a matter. 2 Addison on Torts, 1036. The principal is liable for damage occasioned by the wrongful act of his agent notwithstanding it was willful, if within the scope of his authority. Weed v. Panama R. R. Co., 17 N. Y. 362. Though a sales agent, as such, has no authority to make a warranty, yet if he sells animals knowing that they are diseased and does not communicate the fact, the principal is liable, not for the breach of warranty, but for the suppression of truth. Jeffrey v. Bigelow, 13 Wend. 518. In general a principal is liable for conversion by his agent. Shotwell v. Few, 7 Johns. 302; Cobb v. Dows, 10 N. Y. 335. If an agent's authority is capable of being executed in a lawful manner it is not usually extended by construction to include pro Art. 8. Principal and Agent. hibited acts so as to render the principal liable on a penalty. Clark v. Metropolitan Co., 10 N. Y. Super. 241; Commissioners of Pilots v. Pidgeon, 23 Hun, 346. Compare, however, Davis v. Bemis, 40 N. Y. 453. An agent has no implied authority to commit a trespass. Vanderbilt v. Richmond Turnpike Co., 2 N. Y. 479. Where an agent employed for a special purpose makes false representations, which are acted upon, the principal is liable the same as if the representations were made by himself. Sandford v. Handy, 23 Wend. 260. “When a party clothes another with authority to speak in his behalf, and indorses him to third persons as worthy of trust and confidence, those who are misled by the falsehood and fraud of the agent are entitled to impute it to the principal. The latter will not be permitted to retain the fruits of a transaction infected with fraud, whether the deceit, which he seeks to turn to his profit, was practiced by him or by his accredited agent. In such a case he cannot separate the legal from the illegal elements of the contract, and appropriate the advantages it secures, while he rejects the corrupt instrumentalities by which they were obtained." Smith v. Tracy, 36 N. Y. 79, 83. In Nowack v. Metropolitan St. Ry. Co., 166 N. Y. 433 (440), it is said that the general rule is that the principal is liable to a third person in a civil action for the fraud or other malfeasance of his agent, perpetrated by the latter in the course of his employment, although the act was ultra vires, and the principal did not authorize, justify or know of it, citing Palmeri v. Manhattan Ry Co., 133 N. Y. 261; Fifth Avenue Bank v. Forty-second St. & G. S. F. R. R. Co., 137 N. Y. 231; Jarvis v. Manhattan Beach Co., 148 N. Y. 652; Stewart v. B. & C. R. R. Co., 90 N. Y. 588. An innocent principal cannot take an advantage resulting from the fraud of an agent without rendering himself civilly liable to the injured party. National Life Ins. Co. v. Minch, 53 N. Y. 144 (149). A sheriff is liable for a trespass or misfeasance of his deputy while acting under color of his office. Waterbury v. Westervelt, 9 N. Y. 598. Art. 8. Principal and Agent. SUBDIVISION 3. Rights of Principal as against Agent. An agent owes to his principal a like duty to that which a trustee owes to a cestui que trust. There is this important difference in the cases. As the supervision of trusts belongs to equity, wrongs by trustees must generally be redressed in that court, while wrongs by agents will be redressed at law, unless the case is such that some peculiar relief which equity only can give is required. Cooley, 615. The test of the liability of the agent to his principal for damages done by reason of the alleged negligence is, speaking generally, the conduct of a diligent or careful or skillful agent in a like situation. If the agent's actions conform to this standard, he will be exempt from liability; otherwise not. Bigelow (7th ed.), 345. A principal and agent also assume toward each other certain duties of due care. The agent must not be negligent in the performance of his trust, and the principal must not negligently lead the agent into danger. Cooley (2d ed.), 615. It will be noted that some transactions, ordinarily legal between the parties, may assume a tortious aspect if they take place between those in a fiduciary capacity or trust relation. Thus, "An agent empowered to sell property for his principal; he cannot become purchaser directly nor by indirection through another." Cooley on Torts, 614, citing Dobson v. Rasey, 8 N. Y. 216; People v. Merchants' Bank, 35 Hun, 97. But an agent without reward is not answerable for nonfeasance; he becomes responsible if he attempts to act and is guilty of negligence. Thorne v. Deas, 4 Johns. 84; Smedes v. Utica Bank, 20 Johns. 372. An agent is not liable for deviation from instructions in cases of emergency. Milbank v. Dennistoun, 21 N. Y. 391; Jervis v. Hoyt, 2 Hun, 637. A total departure from instructions may amount to conversion. McMorris v. Simpson, 21 Wend. 610; Scott v. Rogers, 31 N. Y. 676. An agent for remuneration must use reasonable skill and or dinary diligence in the line of business. He is liable to his principal for damages sustained by want of ordinary skill and diligence. Heinemann v. Heard, 50 N. Y. 27; Gleason v. Clark, 9 |