weight of authority sustains the power to give an agent oral authority to make a contract for the purchase or sale of land.21 In Georgia any contract of which a written memorandum is required when entered into by the principal himself, cannot be made by an agent on his behalf unless the agent has written authority.22 In Kentucky, contracts of suretyship cannot be executed by an agent unless his authority is written. 23 If the general principle assumed by many of the cases cited in this section is sound-that the authority of the agent must be executed with the same formality that is required in the execution of the contract which the agent is to execute, it follows that if attestation or acknowledgment is required for the validity of a contract, it is also required for the validity of a power of attorney.24 § 277. Apparent authority and estoppel. An agent may be able to make contracts which will bind his principal not only when actually authorized by express words or implication of fact to do so but also in cases where the principal did not intend to confer such authority on the agent but, nevertheless, held out to the public or to the person with whom the agent dealt an appearance of authority. If one with whom the agent dealt justifiably believed the agent was authorized, and if the facts justifying that belief were due to the conduct of the supposed principal, the latter will be bound. The misconduct on the part of the supposed principal need not have been fraudulent or wilful. 25 Illustrations of apparent authority binding the principal, though no actual authority was given, arise where a person is knowingly permitted by another to act in business matters in the latter's name, or apparently on his behalf. 26 21 See infra, § 489. 22 Overman v. Atkinson, 102 Ga. 750, 29 S. E. 758. 23 First Nat. Bank v. Gaines, 87 Ky. 597, 9 S. W. 396; Simpson v. Commonwealth, 89 Ky. 412, 12 S. W. 630; Inter-Southern Life Ins. Co. v. First Nat. Bank, 178 Ky. 95, 198 S. W. 563. 24 Lithograph Bldg. Co. v. Watt, 96 Ohio St. 74, 117 N. E. 25. 25 Bronson's Exec. v. Chappell, 12 Wall. 681, 20 L. Ed. 436; Johnson v. Christian, 128 U. S. 374, 32 L. Ed. 412, 9 S. Ct. 87; Stark Electric R. Co. v. McGinty Contracting Co., 238 Fed. 657, 151 C. C. A. 507. 26 Thomas v. Moody, 57 Cal. 215; Florida, etc., R. Co. v. Varnedo, 81 So where one intrusts another with negotiable paper containing blanks, he is bound, as against a holder in due course, by the terms of the instrument as filled in by the person intrusted therein though the blanks were filled in violation of the authority actually given; 27 and in any case where a supposed principal by his conduct justifies another in assuming the existence of authority, he will be bound by simple contracts entered into on his behalf within the apparent authority of the supposed agent. § 278. Ratification. Subsequent ratification by a principal of a contract made on his behalf by one who had at the time neither actual nor apparent authority, is as effectual as original authorization. Not only is a contract formed between the principal and the third person, but the agent is absolved from liability for loss which may happen because of his unauthorized action. 28 Ratification like original authority need not be express. Any conduct which indicates assent to the transaction is sufficient. 29 Even silence with full knowledge of the facts may operate as a ratification. The person with whom the agent dealt will so obviously be deceived by assuming the professed agent was authorized to act as such, that the principal is under a duty 140 Mass. 517, 5 N. E. 485; Columbia Mill Co. v. National Bank of Commerce, 52 Minn. 224, 53 N. W. 1061; James v. Russell, 92 N. C. 194; Ferguson v. Majestic Amusement Co., 171 N. C. 663, 89 S. E. 45; National Surety Co. v. Miozrany, 53 Okl. 322, 156 Pac. 651; Hill v. Nation Trust Co., 108 Pa. 1. See Negotiable Instruments Law, Sec. 14, infra, § 1141. Authority to fill in blanks in a bond, however, cannot thus arise, but must be given under seal. Hibblewhite v. M'Morine, 6 M. & W. 200; Preston v. Hull, 23 Gratt. 600, 14 Am. Rep. 153. See also supra, $275. 23 Lunn v. Guthrie, 115 Ia. 501, 88 N. W. 1060; Triggs v. Jones, 46 Minn. Ga. 175, 7 S. E. 129; Thomas v. Wells, 277, 283, 48 N. W. 1113; Wann v. Scullin, 235 Mo. 629, 139 S. W. 425; Osborne v. Durham, 157 N. C. 262, 72 S. E. 849; Green v. Clark, 5 Denio, 497; Hazard v. Spears, 4 Keyes, 469. 29 Bronson's Exec. v. Chappell, 12 Wall. 681, 20 L. Ed. 436; Arzuaga v. Gonsalez, 239 Fed. 60, 152 C. C. A. 110, L. R. A. 1917 D. 697; Martin v. Powell (Ala.), 75 So. 358; Burkhard v. Mitchell, 16 Col. 376, 26 Pac. 657; McDowell v. McKenzie, 65 Ga. 630; Davenport v. Burke, 30 Idaho, 599, 167 Pac. 481; White City Elec. Co. v. Fleckles, 201 Ill. App. 459; Brimmer v. M. H. Brimmer, 174 N. C. 435, 93 S. E. 984; Wile v. Ewing, 67 Pa. Super. 472. to undeceive him.30 It is true that there are contrary judicial expressions. It is sometimes asserted that here as in the formation of contracts, 31 silence is purely negative and justifies no inferences.32 But silence may justify reasonable inferences, as well as positive action, and a person is no more justified in keeping silent when he knows, or ought to know that a reasonable person will regard his silence as assent, than he is in making a gesture that he knows is ordinarily regarded as an expression of assent, and afterwards asserting that it was not so intended and that he made the gesture merely in the exercise of his privilege to move his hands about in the way that seemed most comfortable. An exception must be made, if the transaction to be ratified is an instrument under seal. In that case the ratification must also be under seal; 33 and so if a statute requires a written authority for a particular transaction,34 oral ratification will not validate an unauthorized execution of the transaction. In order that ratification shall be effective, not only must the transaction originally have been entered into on behalf of the person who subsequently ratifies it, but the supposed agent must have professed at the time to be acting as such.35 The anomalous doctrines of undisclosed principal are 30 Courcier v. Ritter, 4 Wash. Cir. Ct. 549; Mobile & Montgomery Ry. Co. v. Jay, 65 Ala. 113; Coffin v. Planters' Cotton Co., 124 Ark. 360, 187 S. W. 309; Pacific Vinegar &c. Works v. Smith, 152 Cal. 507, 93 Pac. 85; Brooke v. Cunningham, 19 Ga. App. 21, 90 S. E. 1037; Pauly v. Madison County, 199 Ill. App. 225; Maddux v. Bevan, 39 Md. 485; Amory v. Hamilton, 17 Mass. 103; Foster v. Rockwell, 104 Mass. 167, 171; Heyn v. O'Hagen, 60 Mich. 150, 157, 26 N. W. 861; Triggs v. Jones, 46 Minn. 277, 283, 48 N. W. 1113; Kent v. Quicksilver Mining Co., 78 N. Y. 159; Price v. Peeples (Okl.), 168 Pac. 191; Philadelphia &c. R. Co. v. Cowell, 28 Pa. 329, 70 Am. Dec. 128; Baker v. Seattle &c. Packing Co., 95 Wash. 45, 163 Pac. 17; Saveland v. Green, 40 Wis. 431. In Norris v. Cook, 1 Curtis, 464, 469, Curtis, J., said: "In Cairnes v. Bleecker, 12 Johns. R. 300, 306, Mr. Justice Spencer says: 'It is a salutary rule, in relation to agencies, that when the principal has been informed of what has been done, he must dissent, and give notice in a reasonable time, otherwise his assent to what has been done shall be presumed.' And the same law may be found in Bredin v. Dubarry, 14 Serg. & Rawle, 27, 30, and in other cases. 31 See supra, § 91. 32 Iron City Nat. Bank v. Fifth Nat. Bank (Tex. Civ. App.), 47 S. W. 533, affd. in Fifth Nat. Bank v. Iron City Nat. Bank, 92 Tex. 436, 49 S. W. 368. 33 See supra, § 275, n. 4. 35 Keighley v. Durant, [1901] A. C. 240 (reversing Durant v. Roberts, thus not extended to the law of ratification. It is essential, too, that the principal should himself have been an ascertained person competent to enter into the transaction at the time when the so-called agent acted.36 Furthermore, the ratification must be made with knowledge of the material facts, or with an obvious lack of any desire to know further facts, or it will not be binding." If either strangers to the transaction or the person who dealt with the supposed agent have acquired rights with reference to the matter between the time of the agent's acts and the time of ratification, these rights cannot be disturbed by the ratification. 38 Thus a rescission, agreed upon by the supposed agent and the person contracting with him, precludes subsequent ratification.399 As the ratification is a substitute for original authority, the fiction is necessary that the ratification relates back to the time when the agent acted.40 Whether the person with whom the agent dealt, if ignorant of the agent's lack of authority, may withdraw from the transaction prior to ratification is a matter which has given rise to some difference of decision. As a matter of technical though somewhat fictitious reasoning, it may be said that since the rati [1900] 1 Q. B. 629); Blackwell v. Kercheval, 29 Iadho, 473, 160 Pac. 741; Crowder v. Reed, 80 Ind. 1, 10; Ferris v. Snow, 130 Mich. 254, 90 N. W. 850. See also Mitchell v. Minnesota Fire Assoc., 48 Minn. 278, 51 N. W. 608; Brown Realty Co. v. Myers, 89 N. J. L. 247, 98 Atl. 310. But see contra, Sartwell v. Frost, 122 Mass. 184; Hayward v. Langmaid, 181 Mass. 426, 63 N. E. 912. 36 Watson v. Swann, 11 C. B. (N. S.) 756; Kelner v. Baxter, L. R. 2 C. P. 174, 185; Melhado v. Porto Alegre, etc., Ry. Co., L. R. 9 C. P. 503, 505. In re Empress Engineering Co., 16 Ch. D. 125, 128; Trueblood v. Trueblood, 8 Ind. 195, 65 Am. Dec. 756; Armitage v. Widoe, 36 Mich. 124. "Lewis v. Reed, 13 M. & W. 834; Coffin v. Planters' Cotton Co., 124 Ark. 360, 187 S. W. 309; Blackwell v. Kercheval, 29 Idaho, 473, 160 Pac. 741; Shields v. Hitchman, 251 Pa. 455, 96 Atl. 1039. If the principal ratifies a contract in writing without reading it when he has the opportunity, he will be bound; Liska v. Lodge, 112 Mich. 635, 71 N. W. 171; or if he otherwise indicates, that he is willing to trust the agent's judgment and ratify his act without further inquiry. Hutchinson Co. v. Gould (Calif.), 181 Pac. 651. 38 Bird v. Brown, 4 Ex. 786, 797; Johnson v. Johnson, 31 Fed. 700, 703; McCracken v. San Francisco, 16 Cal. 591, 624; Goldschmidt v. Board of Education, 217 N. Y. 470, 112 N. E. 167; Kempner v. Rosenthal, 81 Tex. 12, 16 S. W. 639. 39 Walter v. James, L. R. 6 Ex. 124. 40 Miller v. People's Sav. Bank, 193 Mo. App. 498, 186 S. W. 547; United States Express Co. v. Rawson, 106 Ind. 215, 217, 6 N. E. 337, and see cases in this section, passim. fication relates back to the time of the agent's acts, it necessarily precedes in legal effect the withdrawal of the person with whom he dealt; and the English courts have reached this result.41 This permits the existence of a situation where a bilateral contract may be binding upon one party since he cannot withdraw, and yet may be, for a time at least optional with the other (the supposed principal), since he can at his pleasure ratify the contract or refrain from doing so. The English rule has not commended itself to the courts in America. It has been held in Pennsylvania 42 that withdrawal at any time prior to the ratification is effectual. This rule treats the promise of the person who bargains with the agent as amounting in legal effect to an offer, which is accepted by the ratification. Strictly there is no offer and acceptance here because the socalled offeror understands that he is making a completed bargain when he enters into the transaction with the agent, and it cannot be assumed that he would have been willing to make a continuing offer. The result, however, seems desirable and may be defended on the analogy of the limitation imposed on the right of ratification where interests of third persons have intervened. The relation back of a ratification to the time of the original transaction is fictitious and the fiction should be limited so that it will not work injustice. It is injustice to hold the other party to the transaction bound prior to the ratification, while the supposed principal is free. The Wisconsin court has gone still further and has held that even though the person who bargains with the agent does not withdraw prior to the ratification he is not bound until he gives a fresh assent to the transaction subsequent to the ratification.43 This view treats ratification as if it were an offer 41 Bolton v. Lambert, 41 Ch. D. 295. See also In re Portuguese Mines, 45 Ch. D. 16; In re Tiedemann, 81 L. T. 191. The English Marine Insurance Act of 1906, Sec. 86, expressly provides "where a contract of marine insurance is in good faith effected by one person on behalf of another, the person upon whose behalf it is effected may ratify the contract even after he is aware of a loss." Williams v. Insurance Co., 1 C. P. D. 757, 764; Boston Fruit Co. v. British, etc., Co., [1906] A.C. 336. Cp. Keighley v. Durant, [1901], A. C. 240. 42 McClintock v. South Penn Oil Co., 146 Pa. 144, 23 Atl. 211, 28 Am. St. Rep. 785. 43 Dodge v. Hopkins, 14 Wis. 630; Atlee v. Bartholmew, 69 Wis. 43, 33 N. W. 110, 5 Am. St. Rep. 103. See also Baldwin v. Schiappacasse, 109 Mich. 170, 66 N. W. 1091. |