Opinion
Argued April 24, 1889
Decided June 4, 1889
Alex. S. Bacon for appellant.
Thomas H. Rodman for respondents.
It should be assumed, without argument, that the plaintiff is not bound by the act of Hartwig, unless his authority to receive the money and discharge the mortgage was established, or unless she has, with knowledge of the facts, recognized that transaction and adopted it. The respondents' contention is that both alternatives are established, viz.: That the payment to Hartwig was a valid payment, and also that Hartwig accounted with the plaintiff and paid over to her the money so received by him. As Bridgman dealt with Hartwig as an agent, and now seeks to charge the representative of Weber as if his dealing had been with the principal, the burden of proof was on him to show either that the agency existed, and that the agent with whom he dealt had the authority he assumed to exercise or that the plaintiff is estopped from disputing it. That an agency of some kind did at one time exist in favor of Hartwig was sufficiently manifested by the power of attorney and proof of its due execution and delivery by Weber. If it be conceded that the act in question was within the authority which Hartwig once had, it would not aid the defendant, for that authority was determined by the death of Weber before the act was performed, and although Bridgman had no notice of his death the act was void and the estate of the principal is not bound.
The question is not new, and it has been uniformly answered by our decisions to the effect that the death of the principal puts an end to the agency, and, therefore, is an instantaneous and unqualified revocation of the authority of the agent. (2 Kent's Com. 646; Hunt v. Rousmanier, 8 Wheat. 174.) There can be no agent where there is no principal. There are, no doubt, exceptions to the rule, as where the agency is coupled with an interest ( Knapp v. Alvord, 10 Pai. 205; Hunt v. Rousmanier, supra; Hess v. Rau, 95 N.Y. 359); or where the principal was a firm and only one of its members died. ( Bank v. Vanderhorst, 32 N.Y. 553.) But both cases recognize the general rule to be as above stated. In Davis v. Windsor Savings Bank ( 46 Vt. 728), the rule was applied. The defendant paid money to the agent after the death of his principal, but in ignorance of it, and the administrator of the deceased recovered. It is quite unnecessary to go through the cases on this subject. The rule at common law which determines the authority of an agent by the death of his principal is well settled, and no notice is necessary to relieve the estate of the principal of responsibility, even on contracts into which the agent had entered with third persons who were ignorant of his death. Those who deal with an agent are held to assume the risk that his authority may be terminated by death without notice to them. This rule was established in England (Leake on Con. 487), although now modified by statute, and is generally applied in this country. (Story on Agency, § 488; Pars. on Con. vol. 1, p. 71; 2 Kent's Com. [12th. ed.] 645, 646.)
In some states alterations have been made by statute; and, following the civil law, it was held in Pennsylvania ( Cassidy v. M'Kenzie, 4 Watts Serg. 282), that the acts of an agent or attorney, done after the death of his principal, of which he was ignorant, are binding upon the parties. This was, however, in opposition to the current of authority. (1 Pars. on Con. 71; 2 Kent's Com. 646.) But even that case does not aid the defendant, for here the agent knew of the death of his principal. Moreover, the defendant might have known it had he taken the precaution to inquire. He had never before dealt with the agent. The power of attorney was not of recent date, and the defendant should be held to have assumed the burden of showing that Hartwig was, at the moment of the transaction, a person authorized to act so as to bind the real owner of the bond and mortgage, whoever that person might prove to be. There is no equity in his favor, for the loss, if any, is from his own negligence.
It is claimed, however, by the learned counsel for the respondents, that the rule has application only where the act of the agent is required to be done in the name of the principal, and his contention is, as we understand it, that, inasmuch as Hartwig had possession of the bond and mortgage, the defendant from that fact had a right to infer an agency to collect, and so the payment was valid. However that might be under other circumstances, the contention has no force in this instance. The power of Hartwig was not left to inference. Whatever it was it came before the defendant in writing. The power of attorney was in his hands. It authorized such acts only as could be performed in the name of the principal, and so the defendant understood it. He caused the power to be recorded, took a discharge of the mortgage under it executed by Hartwig as agent for Weber, and gave the check payable to the order of Hartwig in that character. Except for the power of attorney and its recitals, and the acts of Hartwig under it, the defendant would not have even the shadow of a defense. In his own name Hartwig could do nothing, and of this the defendant had full notice. The power of attorney which accompanied possession of the securities defined the actual authority, and the defendant had notice of its contents at the same moment that he saw the bond and mortgage in the hands of the attorney. The authority which might be gathered from their mere possession is, under these circumstances, of no force. The giving of an authority in writing imports that the extent of the authority is to be looked for in its terms, and not elsewhere.
But a more difficult question remains, one on which the courts below differed, and in consequence of which difference we have jurisdiction to pass upon it. (Code, §§ 1337, 1338.) It is a question of fact whether, with knowledge of the circumstances, the plaintiff ratified the payment.
The omitted portion of the opinion discusses the evidence as to knowledge and ratification of payment by plaintiff; the court coming to the conclusion that it failed to show such knowledge or ratification.
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It is true that between the time of payment and the beginning of this suit many years elapsed, but the fact of payment was unknown to plaintiff. It is also true that she failed, before this action and during all these years, to demand either principal or interest from the defendant, but she was altogether ignorant that the security existed, by means of which either had become due. To show the contrary was the duty of the defendant, if the truth enabled him to do so. The trial judge found that he had failed in this respect, and we have no hesitation in saying that a different finding would not have been justified by the testimony. The conclusion aactully reached was the only one permitted by the evidence. The appeal necessarily succeeds. ( Sherwood v. Hauser, 94 N.Y. 626; Baird v. Mayor, etc., 96 id. 567; Crane v. Baudouine, 55 id. 256; Westerlo v. De Witt, 36 id. 340.)The order of the General Term should, therefore, be reversed, and the judgment of the Special Term affirmed, with costs.
All concur.
Ordered accordingly.