It now remains to state what are the effects of the relation of principal and agent, as between the agent and third persons.
An agent is not in general personally responsible on any contract entered into by him on behalf of his principal-: to this rule, however, there are several ex ceptions.
First. If an agent has so far exceeded his authority that his principal is not bound by his act; as for instance, if an agent without any authority undertakes for his principal to pay a certain sum, or if a special agent warrants goods, con trary to his instructions; and the prin cipal refuses to adopt such undertaking or warranty, the agent alone is liable to the person to whom it was given. i Secondly, an agent is liable when the contract was made with him not as agent. And, therefore, if in any contract made on behalf of his principal, the agent binds himself by hie own express undertaking, or if the circumstances of the transaction are such that the credit was originally.
given to him and not to the principal (whether such principal were known at the time or not), iu either of these cases he will be liable, in the first instance, to the persons with whom he has dealt.
For the same reason, when an agent takes upon himself to act in his own name, and gives no notice of his being employed in behalf of another person as if a factor delivers goods as his own and conceals his principal—he is to be taken, to all intents, as the principal, and the persons who have dealt with him are entitled to all the same rights against him as if he actually were so. They may, for instance, in an action by the principal on demand arising from such transactions, set off a debt due from the agent himself; which they could not have done, if they had known that he acted only as an agent. And if he after wards discloses his principal, he is, never theless, not discharged from his liability, —those with whom he has dealt may, at their option, come either upon him on his personal contract, or on the principal upon the contract of his agent.
An agent is responsible to third per sons for any wrongful acts, whether done by the authority of his principal or not ; and in most instances the person injured may seek compensation either from the principal or the agent, at his optiiin.
An agent cannot delegate to another the authority which he has received, so as to create between his employer and that other person the relation of prin cipal and agent; but he may employ other persons under him to perform his engagements, and the original agent is responsible to his principal as well for the conduct of such sub-agents as for his own: but with respect to dimage sus tained by third persons from the wrong ful acts of such sub-agents, the case is different; such damages must be reco vered either from the person who in fact did the injury, or from the principal for whom the act was done. The original agent is responsible to third persons only for his own acts, and such as are done at his command.
If an agent who is intrusted with money or valuable security, with written directions to apply the same in any par ticular manner, in violation of good With converts it to his own use ;—or if an agent who is intrusted with any chattel, valuable security, or power of attorney for the transfer of stock, either for a.6
custody or for any special purpose. in violation of good faith, and without au thority, sells or pledges, or in any manner converts the same to his own use, he is guilty of a misdemeanor punishable with fourteen years' transportation, or to fine and imprisonment at the discretion of the court. Bat this does not extend to prevent his disposing of so much of any securities or effects on which he has a lien or demand, as may be requisite for the satisfaction thereof. It is also a mis demeanor, punishable in the same man ner, if a factor or agent employed to sell, and intrusted with the goods or the docu ments relating to them, pledges either the one or the other, as a security for any money borrowed or intended to be bor rowed, provided such sum of money is greater than the amount which was at the time due to the agent from the prin cipal, together with any acceptances of the agent on behalf of his principal. (Stet. 7 & 8 Geo. IV. c. 29, 5. 49, &c.) The 5 & 6 Vict. c. 39, entitled Act to amend the law relating to ad vances bond fide made to agents intrusted with goods," facilitates and gives protec tion to the common practice of making advances on the security of goods or documents to persons known to have pos session thereof as agents only. Accord ing to the above act, any agent who is in the possession of goods or of the docu ments of title to them is to be held in law as the owner, to the effect of giving "va lidity to any contract or agreement by way of pledge, lien, or security bond fide made by any person with such agent." The agent may receive back commodities or titles which have been pledged for an ad vance and may replace them with others, but the lender's lien is not to extend beyond the value of the original deposit. The documents which are held to authorize the agent in disposing of property represented by them, and the transference of which is a sufficient security to the lender, are " any bill of lading, India warrant, dock warrant, warehouse-keeper's certificate, warrant or order for the delivery of goods, or any other document used in the ordinary course of business as proof of the possession or control of goods, or authorizing or purporting to authorize, either by indorsement or delivery, the possessor of such document to transfer or receive goods thereby represented." The property represented by any docu ment is held to be conveyed as soon as the document is transferred, although the property is not in the agent's hands; and an advance of money on consignment or indorsation is valid although the consign ment or indorsation do not take place at the date of the agreement. A contract by the agent's clerk, or any person act ing for him, is binding. An agent grant ing a fraudulent security is liable to transportation, or such other punishment by fine or imprisonment, or both, as the court may award. There are provisions in the act for enabling the owner to re deem his goods while they remain unsold, on satisfying the person who holds them as a security; and for protecting the prin cipal in the case of the agent's bank ruptcy.