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BY ALBERT SIDNEY BOLLES,
PH.D., LL.D.
THE MODERN LAW OF BANKING
BANKS AND THEIR DEPOSITORS
BANK OFFICERS
BANK COLLECTIONS
THE NATIONAL BANK ACT AND ITS JUDICIAL INTERPRETATION
Putnam's Handy Law Book
for the Layman
Putnam's
Handy Law Book
for the Layman
By
Albert Sidney Bolles, Ph.D., LL.D.
Formerly Professor of Commercial Law and Banking in the
University of Pennsylvania, also Lecturer on the
Same Subjects in Haverford College
G.P. Putnam's Sons
New York and London
The Knickerbocker Press
Copyright, 1921
by
Albert Sidney Bolles
Published September, 1921
Reprinted December, 1921
" March, July, 1922
" April, 1923
[Illustration]
Made in the United States of America
FOREWORD
What useful purpose can this book serve? Most of the laws under which
we live are kept, not from knowing them, but because the good sense of
individuals leads them along legal ways. Yet in many cases their good
sense fails to discover the right way. Thus, the receiver of a check
on a bank must present it within a reasonable time after receiving it,
and if he keeps it longer the risk of loss, should the bank fail, is
his own. What is this reasonable time? One man says three days,
another a week, another a month. So one's common sense fails to
establish a definite reasonable time. It is needful to have the time
fixed, and the law therefore has established a reasonable time. There
are many cases like this in which one's common sense fails to furnish
a correct, yet needful guide.
This little book contains many of the legal principles that are in
most frequent use, as readers will learn who carefully read it. Again,
if they do not always find an answer to their questions, it is
believed that in many cases they will find enough law of a general
nature from which they can safely solve their questions. They are
therefore besought to do something more than merely consult this book
for the purpose of finding ready and complete answers to their
questions, to read it and become familiar with its contents.
Besides the law presented here the reader should learn to be cautious,
and not trust too much his own judgment when no rule can be found for
his guidance. Many a person has written his own will, as he has a
right to do, and after giving a legacy to a relative or friend has
nullified the gift by having the legatee, through the testator's
ignorance, sign as a witness. The writer knew a railway president who
had the temerity to draw the writing containing an important contract
between his railroad and another, and who, by unintentionally putting
a comma in the wrong place, made his road instead of the other
responsible for large losses. If this book shall make the reader
cautious concerning the legality of his undertakings, it will be worth
to him many times its price.
A.S.B.
CONTENTS
PAGE
EXPLANATION OF TERMS 1
ADOPTED CHILD 5
AGENCY 6
AGREEMENT TO PURCHASE LAND 15
AUCTIONEER 16
AUTOMOBILE 19
BAILOR AND BAILEE 26
BANKRUPTCY 31
BENEFICIAL ASSOCIATIONS 38
BROKER 45
CARRIER 48
CHATTEL MORTGAGE 52
CHAUFFEUR 57
CHECK 58
CITIZEN 62
CONTRACTS 64
CORPORATIONS 72
CURTESY 101
DECEIT 102
DEEDS 104
DIVISIONAL TREE 113
DOWER 113
DRUNKENNESS 116
EQUITABLE REMEDIES 118
FACTOR 123
FIRE INSURANCE 124
FIXTURES 132
GARAGE KEEPER 133
HOMESTEAD 135
HUSBAND AND WIFE 137
INNKEEPER 147
LAND LICENSE 149
LEASE 151
LEGAL REMEDIES 164
LIFE INSURANCE 167
MINOR 176
MORTGAGE 177
NEGOTIABLE PAPER 183
PARENT AND CHILD 197
PARTNERSHIP 198
PATENT 202
PAYMENT 211
PRESCRIPTIVE RIGHTS 214
QUASI CONTRACTS 218
SALE 227
SHIPPING 235
STATUTE OF FRAUDS 242
STATUTES OF LIMITATION 243
TELEGRAPH AND TELEPHONE 246
TORTS OR WRONGS 248
WARRANTY 260
WILL 262
WORKMEN'S COMPENSATION ACTS 266
LEGAL FORMS FOR EVERYDAY USE 277
INDEX 321
Putnam's Handy Law Book for the Layman
=Explanation of Terms.=--At the outset the explanation of a few terms,
often used, may be helpful to the reader. Among these are the terms
statute and common law. Statute law or statutes mean the laws enacted
by the state legislature and by the federal congress. Common law means
the decisions made by the state and federal courts. These decisions
may relate to the interpretation and application of statutes, or to
the application of former decisions or precedents, or to the
qualification and application of them, or to the making and
application of new rules or principles where none exist that are
needed to decide the case in hand.
It is a rule of the most general application that legal decisions are
precedents which are to be followed in other cases of the same
character. The decisions of the highest court in each state must be
followed by the lower courts, but no courts in any state are obliged
to follow the decisions of the courts in any other state. The courts
in every state must also follow the decisions of the federal courts in
all matters of a national character. Thus if a federal court decides
the meaning or interpretation of a federal statute, a state court must
follow the interpretation in a case requiring the application of that
statute.
Again, common law decisions are not binding on the courts that make
them like statutes or legislative commands. A decision may be modified
or set aside when it is regarded as no longer applicable to the
present condition of things. It may also be set aside or changed by
legislative action. The common law is therefore always slowly changing
like the ocean and is never at rest.
The common law forms much the largest part of the great body of law
under which we live. This book is a collection chiefly of common law
principles; a few statutes are interwoven here and there to complete
the subjects presented.
The distinction also between civil and criminal law requires
explanation. Nearly all criminal law is founded on statutes, in other
words the statutes, state and federal, define nearly all legal crimes
known to society. It is therefore true that the field of crime is not
fixed, is in truth always changing. Thus formerly if a man bought
goods on credit of another on the statement that he was worth fifty
thousand dollars and the seller afterward learned that he was not
worth fifty cents, the seller could sue the buyer to recover the value
of the goods and for any additional loss, but could do no more. Many,
perhaps all the states, now declare by statute that such an act is a
crime, and the offender can be prosecuted by the state and fined or
imprisoned or both. And the wrongdoer may still be sued in a civil
action for the loss to the seller as before.
All crimes are prosecuted by the officers of the state chosen or
appointed for that purpose. Again, as in the case mentioned, the
wrongful act has a double aspect. An individual who has been wronged
may proceed against the wrongdoer to recover his loss; the state also
has been wronged and may also proceed against him. A good illustration
is a bank defaulter. The bank may proceed through a court of law to
recover the money lost by him, or from those who have promised to make
the bank good should he wrongfully take anything; the state may also
proceed against him as a criminal for breaking a statute that forbids
him from doing such a thing. Furthermore, should the bank, as often
happens, agree to accept a sum from the defaulter and not trouble him
further, the agreement would be no bar to an action by the state
against him.
The terms law and equity are frequently used in the law books and
require explanation. Formerly there was no such term as equity in the
common law. It came to be used as a supplement to the law to indicate
ways of doing things unknown to the law, which ought to be done. Thus
if a man threatened to fill up your well because it stood, as he
claimed, on his land, you had no preventive remedy at law. You could
use some force to prevent him, you could not kill him, or put out his
eyes, or treat him roughly. The law only gave you the right to proceed
against him to recover money damages for the legal injury. A court of
equity has a preventive remedy. If one threatens to fill up your well
you can petition or pray the court to order that he shall refrain
until there has been a legal hearing to determine whether he has any
right to do so and the court will order him to desist until it has
heard the case, and will enforce its order with a fine or penalty
should he disobey.
The term equity contains a larger element of justice than law; and the
courts often say that an act is just or equitable, meaning that an act
which is just or equitable may not always be a legal act. Equity
therefore is a broader term, and is in constant use in legal
proceedings.
Another word frequently used in this book is action. When a person has
wronged another, for example, has not paid a promissory note that is
due, and the wronged party wishes to collect it through the courts, he
brings an action, so called, against the wrongdoer for that purpose.
Sometimes the word suit is used. Suit, or case in court, is a common
expression.
Finally something should be said about courts of law. Every state has
three kinds or classes of courts. First a court in which suits are
brought and tried relating to small matters, the recovery of money,
for example, for one or two hundred dollars or less, also for small
petty criminal offenses. Next is a higher court in which suits for all
larger matters are begun and tried, as well as appeals from the lower
court. Lastly is a third court of review, usually called the supreme
court, composed in most of the states of five, or more often, seven
judges, who review the decisions of the court below whenever
application is made founded on erroneous matters, the wrongful
admission of, or refusal to admit, evidence and the like, and their
decisions form the great body of the common law.
The federal government also has three courts corresponding somewhat to
the courts established by the states. First is a court existing in
every state called the district court, while some states, like New
York, are divided into several districts. An appeal lies from its
decision to the court of appeals consisting of three judges. There are
nine of these courts, one for each circuit into which the United
States is divided. Lastly appeals may be taken from their decisions
and also from the decisions of the supreme courts of the states to the
supreme court of the United States consisting of nine judges. An
appeal does not lie in every case decided by a state court or by the
federal courts of appeal; only such cases as the highest court shall
decide after application, made in proper form, may be appealed and
heard by that tribunal.
We have already explained the term equity. Formerly there were courts
to try and decide equity cases. England still maintains such courts
and a few exist in the United States; New Jersey and Delaware are two
of these states. The chief official of the court is called a
chancellor, the others vice chancellors. Instead of an action, as in a
court of law, the preliminary proceeding is called a petition or bill,
and while in substance it is similar to an action or complaint, used
in a court of law, the form is quite different. The modern tendency of
the law, considered in the most general way, is to fuse law and
equity, and to endow law judges with equity powers. For further
explanation see _Legal Remedies and Equitable Remedies_.
=Adopted Child.=--Children are sometimes adopted. By doing so the
natural parents lose all personal rights and are relieved from all
legal duties. The adopted parents acquire the right to the adopted
child's custody and control, to his services and earnings, and they
must maintain and educate him. In some states he becomes the heir of
the adopted parent like a natural child, with some limitations. Who
can inherit an adopted child's property is not clearly settled. He can
also inherit from his natural parent and kindred as if he had not been
adopted. In Massachusetts the courts hold that an adopted child will
take like a natural child under a residuary clause in an adopted
father's will giving all the property not otherwise devised to his
child or children. See _Parent and Child_.
=Agency.=--Much of the business of our day is done by agents or
persons who represent others. The most general division is into
general and special agents. A general agent is one who has authority
to act for his principal or person he represents in all matters, quite
as the principal himself could do; or in some of his matters. Thus if
a principal had a farm he might have a general agent to act as his
farmer; if he owned a mill, another general agent who had charge of
it. If he had two mills, he might have a general agent for each, and
so on.
A special agent is authorized to do a specific thing, to sell a home,
buy a horse, or effect some particular end or purpose. While this
distinction is plain enough in many cases, in others the lines run so
close together that it is difficult to decide whether one is a general
or special agent.
Whenever one acts as a general agent he is supposed to have all the
authority that general agents possess who thus act for their
principals, unless the person who is dealing with him knows of the
restriction on his authority. Suppose one goes to the office of a
general insurance agent to get insurance on his home. A policy is
taken and afterwards the house burns up. The company declines to pay
because the agent made a lower rate than was authorized by his
company. The insured however knew nothing about the restriction, and
supposed that the agent had the same authority as other insurance
agents have concerning rates. The company would be obliged to pay. But
if the insured knew that restrictions had been put on the agent and
that he was violating them in giving him the lower rate, the company
would not be liable.
One who deals with a special agent must find out what authority he
possesses; therefore more care is needful in dealing with a special
than with a general agent. His authority must be strictly pursued.
Thus it is said that a person dealing with him "acts at his own
peril," is "put upon inquiry," "is chargeable with notice of the
extent of his authority," "it is his duty to ascertain," "he is bound
to inquire," "and if he does not he must suffer the consequences."
In some cases the law creates an agency. Thus an unpaid vendor of
goods sometimes has authority to sell them, so has a pledgee of goods
outside the authority conferred by the contract pledging them. A
married woman whose husband does not supply her has a limited power to
buy necessaries on her husband's credit, which prevails
notwithstanding any objection he may make. A minor sometimes has the
same power.
A person can act as an agent for another who cannot act for himself.
Minors therefore can thus act. Besides individuals, corporations often
act for others.
The authority of an agent may be given in writing, a power of attorney
so called, or he may act, and often does, without written authority,
especially a general agent. To this rule there is one well understood
exception. If an agent is required in executing his authority to sign
a deed or other writing, especially a sealed writing, his authority
must also be equally great. In executing a deed therefore his
authority must be in writing under seal, and when the deed is
recorded, the agent's written authority should also be recorded; this
is the usual practice. If this is not done, some person who afterward
wished to purchase the land might object because the recorded title
was defective.
A particular usage or custom also affects an agent's powers. If the
principal confers on him authority to transact business of a
well-defined nature, bounded by well-defined usage and customs, the
law presumes the agency was created with reference to them. This
protection affects agents and third persons alike, the latter
therefore who act in good faith in such dealings are protected against
secret limitations of which they had no notice.
An agent has no authority to purchase his principal's property. To do
this, in a sense, would be to purchase of himself. The temptation to
do this is sometimes very great, too great for him to withstand, and
so he resorts to a crooked method for accomplishing his end. He sells
the property to another party who afterward sells it back to him. The
worst violators of this principle have been railway receivers, who
have taken advantage of their position to get control of the property
entrusted to them at a sum much less than its real value. Such sales
can be set aside by proper legal procedure. By the modern rule they
are not void but are voidable, that is, can be set aside if the
creditors or other interested parties wish to do so.
Whenever therefore one deals with a general agent and his authority is
disputed, unless there be restrictions known to the person dealing
with him, the liability of his principal turns on the answer to the
general question, what authority do general agents like himself have.
This is simply a question of fact, to be determined like every other
question of fact by the court in which the controversy is pending.
Another way of rendering a principal liable for the act of his agent
is by ratifying it. Suppose A professed to be the agent of B in
building a house for C, and built it so badly that C sued B to recover
damages, whose defense was, that A was not his agent. Suppose,
however, that B accepted payment for the house, this would be a
ratification of A's authority to act for B even if he did not have
proper authority in the beginning. Suppose A had authority to sell
goods for B but not to collect payment, and someone should pay him and
he ran off with the money, could his principal still collect the money
of the buyer of the goods? This is a hard case, and has happened many
times. The buyer usually is required to pay the second time. But if B,
notwithstanding his direction to his agent not to collect payment,
should receive it such conduct would operate as a ratification.
Whether the authorized act arises from a contract or from a wrong or
tort, whoever with knowledge of all the facts adopts it as his own, or
knowingly appropriates the benefits, which another has assumed to do
in his behalf, will be deemed to have assumed responsibility for the
act. Of course, such action does not render an act valid that was
invalid before; its character in this respect is not changed by
anything the ratifier may do.
Can a forgery be ratified? The right of the state to pursue the forger
cannot be defeated by its ratification, but so far as the act may be
regarded merely as the act of an unauthorized agent, it may be
ratified like any other. Mechem says that if at the time of signing,
the person doing so purported to act as agent, the act might be
ratified.
Again, a principal cannot accept part of an agent's act and reject the
remainder. The acceptance or rejection must be complete.
In appointing an agent the principal has in mind the qualifications of
the person appointed, he cannot therefore without his principal's
consent, designate or substitute another person for himself. This rule
though does not prevent him from employing other persons for a minor
service. Indeed, in many cases a general agency requires the
employment of many persons to execute the business. How far one may go
in thus employing others to execute the details, and how much ought to
be done by the general agent himself, depends on the nature of the
business. The inquiry would be one of fact, to what extent is a
general agent in his particular business expected or assumed to do the
things himself.
One rule to guide an agent is this: when the act to be done is purely
mechanical or ministerial, requiring no direction or personal skill,
an agent may appoint a subagent. Thus an agent who is appointed to
execute a promissory note, or to sign a subscription agreement, or to
execute a deed, may appoint another to do these things. Likewise an
agent who is authorized to sell real estate with discretionary power
to fix the price and other terms, may employ a subagent to look up a
purchaser, or to show the land to one who is desirous of purchasing.
When a person is really acting as an agent, but this is not known by
the persons with whom he is doing business, he is liable to them as if
he were the principal. It often happens for various reasons that
agents do not disclose their principals. Suppose a dealer finds out
that the agent presumably acting for himself was, in truth, acting
for another, could the real principal be held responsible and the
agent escape, or could both be held? The answer is, after discovering
the real principal, both can be held, or either of them. The failure
of an agent to disclose his agency will not make him individually
liable if the other party knew that he was dealing with a principal
with whom he had had dealings through the agent's predecessor. Notice
of the agency to one member of a firm is not sufficient notice to the
firm to release the agent from personal responsibility in subsequent
transactions with another member who did not know and was not informed
of the agency. Again, the liability must be determined by the
conditions existing at the time of the contract, his subsequent
disclosure will not relieve the agent. Finally, while the agent may be
held in such a case, the principal also is liable, except on
instruments negotiable and under seal, on the discovery of his
relationship as principal.
While secret instructions to an agent that are unknown to persons
dealing with him do not bind them, the principal is liable for any
acts within the scope of his agent's authority connected with the
business conducted by his agent for him. Some very difficult questions
arise in applying this rule. A car conductor is instructed to treat
passengers civilly and to use no harsh means with them, save in
extreme cases. How far may a conductor go with a disorderly passenger?
Very likely he would be justified in putting him off; suppose the
conductor was angry and administered hard and needless kicks in the
operation? His principal surely would not be liable, though the
conductor doubtless would be. Suppose in buying a railway ticket the
agent loses his temper and calls you a liar and a thief, you would
have an action against him for slander, unless you happened to be one,
but you would have no action against his principal for the company did
not employ him to slander its patrons; to do this was clearly not in
the scope of his employment.
An agent must not act for both parties in any transaction unless this
is understood by both of them. Nor can an agent receive any personal
profit from a transaction. Whatever profit there may be should be
given to the principal. Thus if an agent is authorized to buy a piece
of property for his principal and buys it for himself, or hides the
transaction under the name of another, the principal, after
discovering what his agent has done, can proceed to obtain the
property.
An agent must be faithful and exercise reasonable skill and diligence.
Money belonging to the principal should be deposited in the
principal's name, or, if in the agent's name, his agency should be
added; otherwise if the bank failed the agent would be responsible for
the loss. Again, if the agent deposited the money in his own name the
true owner could proceed against the bank to recover it.
A principal is liable for the statements and representations of his
agent that have been expressly authorized. He is also liable even for
false and fraudulent representations made in the course of the agent's
employment, especially those resulting in a contract from which the
principal reaped a benefit. Even though the statements may not have
been expressly authorized, such authority may be implied by law
because they are the natural and ordinary incidents of the agent's
position. Thus the position of a business manager often calls for a
great variety of acts, orders, notices, and the like, and statements
made while performing them are regarded as within the line of his
duty.
An agency may end at a fixed time, or when the particular object for
creating it has been accomplished, or by agreement of the parties. In
many cases an agency is created for an indefinite period, and in these
either party can terminate it whenever he desires. There are some
limitations to this principle. Neither party can wantonly sever the
relation at the loss of the other; and if one of them did he would be
liable for the damage sustained by the other. Likewise if the agent
has an interest of his own in the undertaking the principal cannot
terminate it before its completion without the agent's consent. Such a
rule is needful for his security. The bankruptcy of a business agent
operates as a revocation of his authority, but not when the act to be
done is of a personal nature like the execution of a deed.
If the principal becomes insane and unable to exercise an intelligent
direction of his business, his condition operates as a revocation or
suspension for the time being of his agent's authority. If on
recovering, he manifests no will to terminate his agent's authority,
it may be considered as a mere suspension, and his assent to acts done
during the suspension may be inferred from his forbearing to express
dissent when they come to his knowledge. Likewise an agent's insanity
terminates or suspends the agency for the time being unless he has an
interest of his own in the matter. Partial derangement or monomania
will not have that effect unless the mania relates to the agency, or
destroys the agent's ability to perform it.
Again, the marriage of a principal in some cases, unless a statute has
changed the common law, will revoke the power previously given,
especially when its execution will defeat or impair rights acquired by
marriage. Thus should a man give a power of attorney to another to
sell his homestead, but before effecting a sale the principal should
marry, his marriage would revoke the power. By marrying the wife
acquires an interest in the property which cannot be taken away from
her without her consent by joining in a deed of conveyance with her
husband. Likewise the marriage of a woman would operate to revoke a
power of attorney previously given by her whenever its execution would
defeat the rights acquired by her husband. An agent's marriage usually
will not affect the continuance of his agency.
When an agency is terminated it is often needful for the principal to
notify all customers for his protection, otherwise they might continue
to do business with the agent, supposing he was thus acting, and
involve him perhaps in heavy loss. This rule applies especially to
partnerships, each member of which is an agent with general authority
to do the kind of business in which it is engaged.
If the authority of an agent in writing is revoked, but is still left
with him and is shown to a third person who, having no knowledge of
the revocation, makes a contract with him, the principal will be held
for its execution.
Another rule of law may be given. The law assumes that any knowledge
acquired by an agent concerning his principal's business, will be
communicated to his principal, who is bound thereby. This rule though
is often difficult to apply. Thus, if a cashier of a bank should learn
that a note was defective, which was afterward discounted by his bank,
it would be regarded as having knowledge of the defect, because it
was the cashier's duty to inform the proper officials before they
discounted it.
The death of either agent or principal terminates the agency except in
cases of personal interest. And when an agent has appointed a
substitute or subagent without direct authority, and for his own
convenience, the agent's death annuls the authority of the subagent or
substitute, even though the agent was given the right of substitution.
But if the subagent's authority is derived directly from the
principal, it is not affected by the agent's death.
=Agreement to Purchase Land.=--An agreement to purchase land must be
in writing to be valid. Oral or parol agreements may be made to do
many things, but everywhere the law makes an exception of agreements
relating to land purchases. A statute that is quite similar in the
states requires this agreement to be in writing and signed by the
party against whom it is to be enforced. Thus if the seller wishes to
enforce such an agreement, he must produce a writing signed by the
purchaser; if the latter wishes to hold the seller, he must do the
same thing. The better way is to have the writing signed by both
parties.
How complete must the writing be? It need not mention the sum to be
paid for the land; it can be signed with a lead pencil: a stamp
signature will suffice. The entire agreement need not be on one piece
of paper. If it can be made out from written correspondence between
the two parties this will be enough.
To this rule of law are some exceptions. Therefore if an oral
agreement for the sale of land is followed by putting the buyer into
possession, the law will compel the seller to give him a deed. The
proceeding would consist of a petition addressed to a court of equity,
which would inquire into the facts, and if they were true, would
compel the seller to give the purchaser a deed of the land. The reason
for making this exception is, the purchaser would be a trespasser had
he no right to be there: to justify his possession the law permits him
to prove, if he can, his purchase of the land; and if he has bought
it, of course he ought to have a deed of his title.
Once, a purchaser who made an oral agreement and paid part of the
purchase money could compel the seller to give him a deed, and many
still think such action is sufficient to bind the bargain. This is no
longer the law. The practice gave rise to much fraud: A would assert
that he gave money to B to pay for land when in truth it was given for
some other purpose. So the courts abandoned the rule founded on the
part payment of the purchase price. A can however get back his money.
An option to purchase land, contained in an agreement to sell, must be
exercised within a reasonable time, if none is fixed in the agreement.
See _Deed_.
=Auctioneer.=--An auctioneer, employed by a person to sell his
property, is primarily the owner's agent only, and he remains his
exclusive agent to the moment when he accepts the purchaser's bid and
knocks down the property to him. On accepting the bid the auctioneer
is deemed to be the agent of the purchaser also, so far as is needful
to complete the sale; he may therefore bind the purchaser by entering
his name to the sale and by signing the memorandum thereof. His
signing is sufficient to satisfy the Statute of Frauds in any state
conferring on an agent authority to make and contract for the sale of
real and personal property without requiring his authority to be in
writing. His agency may begin before the time of the sale and continue
after it. Again, the entry of the purchaser's name must be made by the
auctioneer or his clerk immediately on the acceptance of the bid and
the striking down of the property at the place of sale. It cannot be
made afterward. The auctioneer at the sale is the agent of the
purchaser who by the act of bidding calls on him or his clerk to put
down his name as the purchaser. In such case there is little danger of
fraud. If the auctioneer could afterward do this he might change the
name, substitute another, and so perpetrate a fraud.
A sale by auction is complete by the Sales Act when the auctioneer
announces its completion by the fall of the hammer, or in other
customary manner. Until such announcement is made, any bidder may
retract his bid; and the auctioneer may withdraw the goods from sale
unless the auction has been announced to be without reserve.
Authority may be conferred on an auctioneer in the same manner as on
any other agent for the sale of similar property, verbally or in
writing. Even to make a contract for the sale of real estate, oral
authority to the auctioneer is sufficient, in the absence of a statute
to the contrary.
Authority to sell property does not of itself imply authority to sell
it at auction, and the purchaser therefore who has notice of the
agent's authority or knowledge sufficient to put him on inquiry,
acquires no title to the property thus purchased. If goods are sent
to an auction room to sell, this is deemed sufficient evidence of
authority to sell them in that manner and to protect whoever buys
them.
As an auctioneer is ordinarily a special agent, the purchaser is
supposed to know the terms and conditions imposed by the seller on the
agent. The seller or owner therefore is not bound by any terms stated
by the auctioneer differing from those given to him. If the owner has
imposed no terms on him, then he has the implied authority usually
existing in such cases.
An auctioneer has authority to accept the bid most favorable to the
seller when the sale is made without reserve and to strike down the
property to the purchaser. He cannot therefore consistently with his
duty to his principal refuse to accept bids, unless the bidder is
irresponsible or refuses to comply with the terms of the sale. He is
justified in rejecting the bids of insane persons, minors, drunken
persons, trustees of the property, and perhaps in some cases of
married women.
An auctioneer cannot transfer his duty to another. This rule does not
prevent him from employing others to do incidental things connected
with the keeping and the moving of the property. He cannot sell on
credit contrary to his instructions or custom; nor would he be secure
in following custom if instructed to do otherwise. After the bid has
been accepted the bidder has no authority to withdraw it without the
owner's consent, nor can he be permitted to do so by the auctioneer.
Nor can he sell at private sale if his instruction is to sell
publicly, nor can he justify himself even if he acted in good faith
and sold the property for more than the minimum price fixed by the
owners. Nor can he sell the property to himself, nor authorize any
other person to bid and purchase for him either directly or
indirectly. It is impossible with good faith to combine the
inconsistent capacities of seller and buyer, crier and bidder, in one
and the same transaction.
He has no authority to warrant the quality of property sold except
custom or authority is expressly given to him. Nor is he an insurer of
the safety of the goods entrusted to him for sale; he must however use
ordinary and reasonable care in keeping them. Lastly, an auctioneer
should disclose his principal and contract in his name. If one bought
property therefore supposing it belonged to A, when in fact it
belonged to B, through any manipulation of the auctioneer, the bidder
would not be bound.
=Automobile.=--The members of the public have a right to use the
public avenues for the purpose of travel and of transporting property:
nor has the driver of horses any right in the road superior to the
right of the driver of an automobile. Each has the same rights, and
each is equally restricted in exercising them by the corresponding
rights of the other.
Again, the public ways are not confined to the original use of them,
nor to horses and ordinary carriages. "The use to which the public
thoroughfare may be put comprehends all modern means of carrying
including the electric street railroad and automobile." It has been
declared that the fact that motor vehicles may be novel and unusual in
appearance and for that reason are likely to frighten horses which are
unaccustomed to see them, is no reason why the courts should adopt the
view of prohibiting such machines.
The general rule is that all travelers have equal rights to use the
highways. An automobile therefore has the same rights and no more than
those of a footman.
The mere fact that automobiles are run by motor power, and may be
operated at a dangerous and high rate of speed, gives them no superior
rights on the highway over other vehicles, any more so than would the
driving of a race horse give the driver superior rights on the highway
over his less fortunate neighbor who is pursuing his journey behind a
slower horse.
There is no authority or power in the state to exclude non-resident
motorists from the public ways, nor have the states power to place
greater restrictions or burdens on non-resident automobilists than
those imposed on their own citizens.
A license to operate an automobile is merely a privilege. It does not
constitute a contract, consequently it does not necessarily pass to a
purchaser of the vehicle, and may, for a good reason, be revoked.
Moreover the charge imposed for the privilege of operating a motor on
the highway is not generally considered a tax, only a mere license or
privilege fee.
An automobile may be hired from the owner. This is called in law a
bailment. The bailor is not responsible generally for any negligence
of the hirer in operating the car. Nor is the rule changed should the
hirer be an unskilled person, unless he was an immature child or
clearly lacking in mental capacity, or was intoxicated. Where the
owner of an automobile delivered it to another by agreement, who was
to pay the purchase price from the money derived from its use, and
thereafter had complete control of the machine, his negligence could
not be charged to the seller.
Again, where an automobile is hired and the chauffeur is also
furnished by the owner, who pays him for operating the car, and the
hirer has no authority over him except to direct his ways of going,
the chauffeur is regarded as the servant of the owner. He, therefore,
and not the hirer is responsible for the negligence of the chauffeur.
Of course, the rule would be changed if the hirer assumed the
management of the car: then the hirer alone would be liable for the
chauffeur's negligence.
A party who hires an automobile from another is bound to take only
ordinary care of it and is not responsible for damage whenever
ordinary prudence has been exercised while the car was in his custody.
If lost through theft, or is injured as a result of violence, the
hirer is only answerable when these consequences were clearly the
result of his own imprudence or negligence. The hirer though must
account for the loss or injury. Having done this, the proof of
negligence or want of care is thrown on the bailor.
If the hirer should sell the automobile without authority to a third
party, the owner or bailor may bring an action against even an
innocent purchaser who believed that the hirer had the title and power
to sell.
There is an implied obligation on the hirer's part to use the car only
for the purpose and in the manner for which it was hired. And if it is
used in a different way and for a longer time, the hirer may be
responsible for a loss even though this was inevitable.
Suppose the hirer misuses the car, what can the owner do? He can
repossess himself, if this can be done peaceably, otherwise he must
bring an action for the purpose. As the hirer acquires a qualified
title to the property, he can maintain an action against all persons
except the owner, and even against him so far as the contract of
letting may set forth the relations between them.
When an owner or hirer undertakes to convey a passenger to a specified
place and, while on the way, the car breaks down, if it cannot be
properly mended at the time and the owner or hirer is able to furnish
another, the law requires him to do so and thus fulfil his contract.
"The owner of a motor vehicle," says Huddy, "is of course entitled to
compensation for the use of the machine. If a definite sum is not
stated in the contract between the parties, there arises an implied
undertaking that the hirer shall pay a reasonable amount. One who uses
another's automobile without consent or knowledge of the owner, may be
liable to pay a reasonable hire therefor. In case the hirer is a
corporation, there may arise the question whether the agent of the
company making the contract has authority to bind the company. Where a
machine is hired for joy riding on Sunday, it has been held that the
contract is illegal and the hirer cannot recover for the use of the
automobile."
The speed of automobiles along the public highways may be regulated by
law. A municipality may forbid the use of some kinds of motor vehicles
on certain streets, but it cannot broadly exclude all of them from all
the streets. The rules regulating travel on highways in this country
are called, "the law of the road." The object of these rules is to
prevent collisions and other accidents, which would be likely to occur
if no regulations existed.
A pedestrian who is about to cross a street may rely on the law of the
road that vehicles will approach on the proper side of the street.
This rule however does not apply to travelers walking along a rural
highway. Huddy says: "When overtaking or meeting such a person, it is
the duty of both the pedestrian and the driver of the machine to
exercise ordinary care to avoid a collision, but no rule is, as a
general proposition, definitely prescribed as to which side of the
pedestrian the passage shall be made."
The law of the road requiring vehicles to pass each other on the
right, contrary to the English custom, has been reënforced in many or
all the states by statutory enactments, and applies also to
automobiles. When, therefore, two vehicles meet and collide on a
public highway, which is wide enough for them to pass with safety, the
traveler on the wrong side of the road is responsible for the injury
sustained by the other. But a traveler is not justified in getting his
machine on the right-hand side of the road and then proceeding
regardless of other travelers; on the contrary, the duty of exercising
reasonable care to avoid injuries to others still continues.
Not only must each one pass to the right, but each must pass on his
own side of the center line of the highway, or wrought part of the
road. And when the road is covered with snow, travelers who meet must
turn to the right of the traveled part of the road as it then appears,
regardless of what would be the traveled part when the snow is gone.
After passing the rear of the forward vehicle an automobilist must
exercise reasonable care in turning back toward the right into the
center of the highway, and if he turns too soon he may be liable for
damages caused by striking or frightening the horses. "If two vehicles
meet in the street, it is the duty of each of them, as seasonably as
he can, to get each on his own right-hand side of the traveled way of
the street."
The rights of travelers along intersecting streets are equal, and each
must exercise ordinary care to avoid injury to the other. An
automobilist nearing an intersection should run at proper speed, have
his car under reasonable control, and along the right-hand side of the
street. If two travelers approach the street crossing at the same time
neither is justified in assuming that the other will stop to let him
pass. When one vehicle reaches the intersection directly in advance of
the other, he is generally accorded the right of way, and the other
should delay his progress to enable the other to pass in safety.
The driver of an automobile may be charged with negligence if, without
warning to a vehicle approaching from the rear, he turns or backs his
machine and causes a collision. Indeed, it is negligence for a
chauffeur to back his machine on a city street or public highway
without looking backward; and especially if one backs his car on a
street car track without looking for street cars.
If an obstruction exists on the right-hand side of a highway, the
driver of a car may be justified in passing to the other side, and in
driving along that side until he has passed the obstacle. Under such
circumstances he has a right to be on the left side temporarily; and
if he exercises the proper degree of care while there, is not liable
for injuries arising from a collision with another traveler. But if
the obstruction is merely temporary, it may be the duty of the driver
to wait for the removal and not to pass on the wrong side of the
highway.
An automobilist must exercise reasonable or ordinary care to avoid
injury to other persons using the highway. What this is depends on
many circumstances, and each case to some extent is decided by its own
facts. Consequently thousands of cases have already arisen, and
doubtless they will still multiply as long as automobiles are used and
their users are negligent.
The competency of the driver is one of the unending questions. Of
course he should be physically fit, not subject to sudden attacks of
dizziness, possessing sufficient strength and proper eyesight and a
sober non-excitable disposition. It is said, that a chauffeur is not
incompetent who requires glasses. But he certainly would be if his
eyesight was poor and could not be aided by the use of them.
The driver must at all times have his car under reasonable control so
that he can stop in time to avoid injury. He must keep a reasonably
careful lookout for other travelers in order to avoid collision; also
for defects in the highway. If by reason of weather conditions, lights
or other obstructions, he is unable to see ahead of him, he should
stop his car. If there be no facilities for stopping for the night, a
driver is not negligent should he proceed through the fog.
Passing to the liability of the owner of a car for the acts of his
chauffeur, the general rule is, he is then liable when the chauffeur
is acting within the scope of his owner's business. When the owner
himself is riding in the car there is less difficulty in fixing the
liability, but when the chauffeur uses the car without the owner's
consent, he is not liable for the conduct of the driver. And this is
especially so in using a car contrary to the owner's instructions and
for the chauffeur's pleasure; or in using it for his own business with
the owner's consent. And the same rule generally prevails whenever a
member of a family uses his parent's car without his knowledge and
consent, and especially when forbidden. But the parent is liable for
the running of a car with his knowledge by a member of his family and
for the convenience or pleasure of other members. See _Chauffeur_;
_Garage Keeper_.
=Bailor and Bailee.=--To create this relation the property must be
delivered to the bailee. Though a minor cannot make such a contract,
yet if property comes into his possession he must exercise proper care
of it. Should he hire a horse and kill the animal by rash driving, he
would be liable for its value. A corporation may act as bailor or
bailee, and an agent acting therefor would render the corporation
liable unless he acted beyond the scope of his authority.
Suppose one picks up a pocketbook, does he become the owner? Is he a
bailee? Yes, and must make an honest, intelligent effort to find the
owner; if failing to do so, then he may retain it as his own,
meanwhile his right as finder is perfect as against all others. Should
the true owner appear, whatever right the finder may have against him
for recompense for the care and expense in keeping and preserving the
property, his status as finder does not give him any lien unless the
owner has offered a reward to whoever will restore the property. To
this extent a lien thereon is thereby created.
The statutes generally provide what a person must do who has found
lost property. Suppose a person appears who claims to be the owner of
the thing found, what shall the finder do in the way of submitting it
to his inspection? In one of the recent cases the court decided that
it was a question of fact and not of law whether the finder of lost
property had given a fair and reasonable opportunity for its
identification before restoring it, and whether the claimant should
have been given an opportunity to inspect it in order to decide
whether it belonged to him.