Where one, without objection, suffers another to do acts which
proceed upon the ground of authority from him, or, by his conduct,
adopts and sanctions such acts after they are done, he will be
bound, though no previous authority exist, in all respects as
though the requisite power had been given in the most formal way.
This doctrine applied to a case depending on special facts.
APPEAL from the circuit court for the District of Wisconsin.
Bronson, of New York, being owner as executor of lands in
Wisconsin, sold a tract to E. and J. Chappell, residing near
Galena, in that state, the sale being negotiated by one W. C.
Bostwick, of the last-named place. A portion of the purchase money
was secured by mortgage, and as it became due it was paid by the
Chappells to Bostwick under the assumption by them that Bostwick,
who had advertised himself during a term of twelve or fourteen
years as the agent of Bronson, was the duly constituted agent of
Bronson to receive it. Bostwick having failed and appropriated the
money to his own use, Bronson now filed a bill against the
Chappells in the court below to foreclose the mortgage. The
defendants set up the payments to Bostwick, and the question
involved was thus a pure question of agency. The defendants relied
upon a correspondence between Bronson and Bostwick, and
particularly, as sufficient of itself, on a letter from the latter
to the former, dated 9 February, 1860, and a reply to it of the
15th. These two letters are quoted and the general character of the
others, with the leading facts of the case, stated in different
parts of the opinion. The court below dismissed the bill, and
Bronson took the appeal.
Page 79 U. S. 682
MR. JUSTICE SWAYNE delivered the opinion of the Court.
But a single question has been argued in this Court, and that is
one arising upon the facts as developed in the record. This opinion
will be confined to that subject.
William C. Bostwick, acting for Frederick Bronson, negotiated
the sale of a tract of land in Wisconsin to the defendants.
According to his custom in such cases, Bronson forwarded to
Bostwick the draft of a contract to be executed by the buyers. At
the foot of the draft was a note in these words:
"William C. Bostwick, Esq., of Galena, is authorized to receive
and receipt for the first payment on this contract. All subsequent
payments to be made to F. Bronson in the City of New York."
The defendants expressed to Bostwick a preference to receive a
deed and give a mortgage. This was communicated to Bronson, who
acceded to the proposition and forwarded to Bostwick a deed and the
draft of a bond and mortgage. On the 25th of March, 1865, the
defendants paid to Bostwick $1,500 of the purchase money, and
executed the bond and mortgage to secure the payment of the
balance. According to the condition of the bond, it was to be paid
to the obligee in the City of New York in installments as follows:
$781.20 on the 13th of November, 1865, and the remaining sum of
$4,562.40 in seven equal annual payments from the 12th of February,
1865, with interest thereon at the rate of 7 percent per annum. The
contract was erroneously construed by Bronson as requiring the
interest on all the installments to be paid with each one as it
fell due. The other parties seem to have acquiesced in this
construction. On the 4th of December, 1865, the defendants paid to
Bostwick, as the agent of Bronson, $825.36 in discharge of the
amount claimed to be due on the 30th of November, 1865, and took
his receipt accordingly. On the 28th of February, 1866,
Page 79 U. S. 683
they paid Bostwick $980 to meet the second installment and
interest, as claimed, with exchange, and took his receipt as
before. Bostwick failed in December, 1866. These moneys were never
paid over to Bronson. He denied the authority of Bostwick to
receive them, and demanded payment from the defendants. They
refused, and Bronson thereupon filed this bill to foreclose the
mortgage. The validity of these payments is the question presented
for our determination.
Agents are special, general, or universal. Where written
evidence of their appointment is not required, it may be implied
from circumstances. These circumstances are the acts of the agent
and their recognition or acquiescence by the principal. The same
considerations fix the category of the agency and the limits of the
authority conferred. Where one without objection suffers another to
do acts which proceed upon the ground of authority from him, or by
his conduct adopts and sanctions such acts after they are done, he
will be bound, although no previous authority exist, in all
respects as if the requisite power had been given in the most
formal manner. If he has justified the belief of a third party that
the person assuming to be his agent was authorized to do what was
done, it is no answer for him to say that no authority had been
given, or that it did not reach so far, and that the third party
had acted upon a mistaken conclusion. He is estopped to take refuge
in such a defense. If a loss is to be borne, the author of the
error must bear it. If business has been transacted in certain
cases, it is implied that the like business may be transacted in
others. The inference to be drawn is that everything fairly within
the scope of the powers exercised in the past may be done in the
future until notice of revocation or disclaimer is brought home to
those whose interests are concerned. Under such circumstances, the
presence or absence of authority in point of fact is immaterial to
the rights of third persons whose interests are involved. The
seeming and reality are followed by the same consequences. In
either case, the legal result is the same.
Page 79 U. S. 684
Bronson, as executor, had a large body of lands in Wisconsin for
sale. For several years prior to the purchase by the defendants,
Bronson had been in the habit of receiving and forwarding
propositions to Bostwick. If approved, Bronson executed and
forwarded contracts for the property, to be executed by the other
parties. In the early part of the year 1860, Bostwick was startled
by a memorandum touching payments, on a draft sent out by Bronson,
like that in the draft sent to Bostwick for execution by the
defendants. On the 9th of February he addressed a letter to Bronson
in which he said:
"My attention was naturally arrested by the note at bottom of
the contract of Tormey, and if it is to be interpreted as an
intimation that a withdrawal of my agency is contemplated, it would
cause me not less surprise than pain, not so much by any means from
the pecuniary consideration connected with it as from the implied
dissatisfaction on your part with the manner in which I have
transacted your business, and it occasions the more surprise that I
have always endeavored to attend with fidelity and promptness to
your business and interests, and have never before had any
intimation whatsoever from you that you were not entirely
satisfied. I am wholly at a loss to conceive wherein I have given
dissatisfaction or failed to do all that was necessary to do or
could be done under the particular circumstances of any case
involving your business or interests in my hands."
On the 15th of the same month, Bronson replied as follows:
"The memorandum at the foot of Tormey's contract I have recently
put on all of my land contracts to repel the construction lately
sought to be put on them that the first
or other payments, if
received by the agent, is an implied waiver of the claim for
exchange, and of the stipulation in the body of the contract that
the money is to be paid to me in the City of New York. In other
words, it is but a repetition of a clause in the contract as
applicable to all except the first payment."
This correspondence suggests several remarks:
Bostwick speaks of his employment as having been, and then
being, an
"agency" for Bronson. He inquires whether
Page 79 U. S. 685
it was contemplated by Bronson to revoke it. Bronson does not
deny or revoke it. He says the object of the memorandum was to
repel the construction that the receipt of "the first
or other
payments by the agent" was "an implied waiver of the claim for
exchange," and which was the same thing in effect -- a waiver of
the stipulation in the contract that the money was to be paid to
him "in the City of New York." It recognizes the authority of the
agent to receive the subsequent payments as well as the first one,
provided exchange were paid upon the former by the debtor.
The language employed by Bronson will admit of no other
construction. It applies with full force to the bond of these
defendants. They paid exchange as well as the principal and
interest of the installments in question. There is no evidence in
the record that the authority thus admitted to exist was ever
withdrawn. It must be presumed to have continued until the
relations of the parties were terminated by Bostwick's failure and
insolvency. Bostwick says in his deposition: "I advertised myself
as the agent of the Bronson lands, which advertising was continued
for a period of twelve or fourteen years." His testimony upon this
subject is uncontradicted.
There are found in the record thirty-four letters from Bronson
to Bostwick, all relating to business connected with the Bronson
lands. The first letter bears date on the 12th of December, 1855,
the last one on the 27th of November, 1865. They are in all
respects such as would naturally be addressed by a principal to an
agent in whose judgment, integrity, and diligence he had the
fullest confidence. They refer to sales, to the delivery of deeds
and contracts, the payment and collection of taxes, and a variety
of other matters in the same connection. Ten of the letters
authorize the delivery of contracts on the receipt of the first
payment by Bostwick. Fourteen of them authorize the collection, or
acknowledge the transmission, of other moneys. Bronson was absent
in Europe from the 9th of October, 1861, until about the middle of
December, 1864. During that time, his business was attended to by
his attorney, E. S. Smith, Esq.,
Page 79 U. S. 686
of the City of New York. There are in the record twenty-one
letters from him to Bostwick. They are of the same character with
those from Bronson. Twelve of them acknowledge the collection and
transmission of moneys for Bostwick. It is not stated whether they
were the first or later payments. But the circumstances show
clearly that they were in most if not in all instances of the
latter character. All collections were made and all business
relating to the lands was transacted through Bostwick. In one of
these letters, Smith says:
"P.S. -- Mr. Bronson, in a letter received, writes: 'I am
willing to sell lands through Mr. Bostwick upon an advance of price
equal to the depreciation of paper money at the time of sale,'
&c."
A further analysis of the letters of these parties would develop
a large array of additional facts bearing in the same direction and
hardly less cogent than those to which we have adverted. There is
no intimation in any of them that Bostwick was regarded as the
agent of the buyers, that he was not regarded as the agent of
Bronson, or that he had in any instance exceeded his authority. It
is unnecessary to pursue the subject further. Viewed in the light
of the law, we think the evidence abundantly establishes two
propositions:
1. That Bostwick was the agent of Bronson, and as such
authorized to receive the payments in question.
2. If this were not so -- that the conduct of Bronson --
numerous transactions between him and Bostwick and the course of
business by the latter -- authorized or known to and acquiesced in
by the former -- justified the belief by the defendants that
Bostwick had such authority and that Bronson was bound
accordingly.
Decree affirmed.