II. EXECUTION FRAUDULENTLY COMPLETED. A. Negotiable instruments: (a) Completed instruments intrusted to other persons though the authority of the persons intrusted is (6) Blank instruments are in the same category. B. Non-negotiable instruments: (a) Completed instruments intrusted to other persons will (6) Blank instruments are subject to the same principle; C. Documents stolen or found: (a) Negotiable instruments: (1) There is no difference between complete and (2) Nor between those intended, and those not in- (3) There is no rule that every one has a right to (4) Estoppel declares for liability in all such cases. (1) The rule just quoted ought to apply to all sorts (2) Stolen or found company bonds pass with a (3) The law is approaching the same conclusion as to company shares. (4) And also as to bills of lading. f (5) But a mortgagee is thus far safe as against damage through abstraction from him of the titledeeds. (6) The true distinction among all classes of documents ought to be made with reference to the facility with which they lend themselves to fraud failure to exercise "an appropriate measure of prudence" should be the test of estoppel. D. The classification into "negotiable" and "non-negotiable" instruments is unscientific and misleading. CHAPTER XXVI. OSTENSIBLE AGENCY - PRINCIPAL AND AGENT. The principal difficulties in the way of scientific treatment of the law of principal and agent are four: (I) the vogue of serious misconceptions relative to the classification of agents into general and special; (II) lack of clear appreciation of the application to the subject of the principles of the law of estoppel; (III) misunderstanding as to the effect upon an unauthorized act of its having been done "for the master's benefit;" and (IV) confusion arising out of the phrase "within the scope of his apparent authority." An attempt will be made to clear away these difficulties. Their discussion will form the four chief divisions of the present chapter. SOME PROPOSITIONS. It will be well, however, to interpose and tentatively suggest a few simple propositions: 1. A man cannot be bound by the act of another unless he authorized it.1 2. Nevertheless, if he personally represents that he has authorized it, and on the faith of that representation some third party has changed his position, he ought to be estopped from denying the existence of authority. In such case the act was, and remains, unauthorized; but there is estoppel against so saying. 3. Assisted misrepresentation also will estop: If the ostensible agent is the one who makes the representation of authority, and the supposed principal has merely assisted that representation done that which has made it credible- he will be as much estopped as if he had himself made the representation. For example, if I should employ a broker to sell some shares, he would appear to have all the authority usually possessed by a broker. Now suppose that I had in fact limited that au1 Ratification as a ground of liability is not within the scope of the chapter. 2 See ante, ch. IV. 3 Pickering v. Busk (1812), 15 East, 38. And see infra. thority, and the broker nevertheless acted as though it were unlimited, I would be estopped from denying his possession of customary power; because I had, by my employment of that particular sort of a person, given the appearance of usual authority. 4. Representation of the existence of authority may arise in two classes of cases: (a) There may be a representation that the person acting was an agent, when in fact he was not. (b) There may be a representation that the person acting had larger powers than he in fact had. In other words, there may be representation (1) as to the existence of agency; or (2) as to the extent of it. This distinction (although probably not scientific) will be of much service. I. GENERAL AND SPECIAL AGENCY. It will observed that in the above short but comprehensive view of the principles of estoppel as applied to the law of principal and agent, nothing is said as to the much-used distinction between general and special agents. Indeed there appears to be not only no necessity but no place for it. Nevertheless there is hardly any distinction more generally affirmed and more frequently appealed to. We must see what there is in it. The most usually adopted statements of the distinction are constructions of the language of Lord Ellenborough which is quoted everywhere: "When that question is discussed it may be material to consider the distinction between a particular and a general authority; the latter of which does not import an unqualified authority, but that which is derived from a multitude of instances, whereas the former is confined to an individual instance."1 A general authority is that "which is derived from a multitude of instances;" and a particular authority "is confined to an individual instance." Does this mean that if particular authority be given in a multitude of instances, then at some point in the sequence, or at the end of it, the authority will become general? If so, and there be some real distinction between the power of a general and special agent, it is extremely 1 Whitehead v. Tuckett (1812), 15 East 408. Among the scores of cases and text books see a discussion in Butler v. Maples (1869), 9 Wall. (U. S.) 766. important that we should be able to say exactly how many instances make up the magic number? Unless indeed we are to be told that the multitude of instances spoken of are not instances of particular authority at all (changing mechanically into general authority), but instances, all of them, of general authority. In which event, however, a new difficulty confronts us, for the first of the series is then, ex hypothesi, a case of general authority; while according to our definition it can only be a case of particular authority, for it is "confined to an individual instance." It is hard to see how the extent or nature of an agent's authority can, in any way, depend upon the frequency or infrequency of the employment. Powers of all and every sort, unlimited as well as the most restricted, may be bestowed upon the agent at his first employment; and may be so continued throughout his life-time. And his exercise for decades of the powers which are given him cannot alter, or affect, or enlarge their extent. For another and altogether different purpose, no doubt former acts of agency are frequently of great importance: You want to prove that A. is B.'s agent, with certain powers; and you know that on previous occasions A. so acted with B.'s consent. But observe that these previous instances (even though there be a multitude of them) do not in any way enlarge or affect the character of the agency. They are merely evidence of an express grant of that sort of authority which the agent has theretofore exercised. For example, a servant has been accustomed to pledge his master's credit for wine; the master refuses to pay the last of a long series of bills; and evidence is given of the previous dealings to prove that the master had in fact authorized the pledge of his credit-not to show that the servant was a general agent or any other sort of an agent, but to prove actual grant of authority. That is the full extent of the doctrine of "a multitude of instances." It proves agency. It does not alter it. A long course of deal 1 Note particularly the reasoning in Spooner v. Browning (1898), 1 Q. B. 533; 67 L. J. Q. B. 339. 2" A single instance repudiated, not enough." Stewart v. Rounds (1882), 7 Ont. App. 515. As to several instances, see Spooner v. Browning (1898), 1 Q. B. 528; 67 L. J. Q. B. 339; Spooner v. Cummings (1890), 151 Mass. 313; 23 N. E. R. 839; Marsh v. French (1899), 82 Ill. App. 76. |