I concur with the conclusion that the decree of the Circuit Court should be affirmed.
For lack of proper time, I shall not undertake a full review of the dissenting opinion of Mr. Justice Cothran, but I do wish to make a few observations as to some statements made by him and to some positions he takes. *Page 304
With the position of the learned justice to the effect that the plaintiff, Mrs. Neely, should not be bound by anything that Colonel Gaston, the attorney for the heirs of Mr. Love, said or did or failed to do, I am in full accord, for he was not at any time the agent or attorney of Mrs. Neely. Indeed, there is no claim on the part of the respondents, or any one else for that matter, that Mrs. Neely is bound by any work or conduct of Colonel Gaston.
Likewise I am in full accord with the position of Mr. Justice Cothran that, prior to the act of 1924 (33 St. at Large, p. 928) it was not necessary for an assignment of a real estate mortgage to be recorded to give such assignment full legal effect. This case, however, does not turn upon the failure to record the assignment of the mortgage.
In my opinion, the issues in this case can be narrowed down to just three plain questions: (1) Was Brice the agent of the plaintiff for the purpose of collecting the amount due to her on the mortgage? (2) If he was not plaintiff's agent for that purpose, did she, by her conduct, allow him to hold himself out as her agent for that purpose? (3) Did the plaintiff ratify the act of Brice in making the collection? An answer to either of these questions favorable to the respondents demands an affirmance of Judge Featherstone's decree.
The law applicable to the first two of these questions is tersely stated by Mr. Justice Cothran in Davis v. Bland, 138 S.C. 354;136 S.E., 300, where he quoted the following from the authority mentioned:
"A principal is liable for the engagements, agreements, representations, and promises of the agent made either within the actual or within the apparent scope of his authority."Goble v. Express Co., 124 S.C. 19; 115 S.E., 900.
In the same case of Davis v. Bland, this Court, through Mr. Justice Cothran, also affirmed the principle announced in the case of Reynolds v. Witte, 13 S.C. 5; 36 Am. Rep., 678: *Page 305
"That a principal is civilly responsible for the fraudulent act of his agent where the act is done in the course of the agency and by virtue of the authority as agent."
I shall not attempt to review all the testimony. The Special Referee held that Mr. Brice was the agent of the plaintiff, and that holding was concurred in by the Circuit Judge. As there seems to be some question as to the correctness of this statement, I quote the following from the report of the Referee:
"As a matter of fact, or rather, of mixed law and fact, I find that J.S. Brice was the duly authorized and trusted agent and attorney of the plaintiff in lending money for her, and in collecting principal and interest on the same, for a period of several years embracing the times of the execution of the J.P. Love note and mortgage set out in the complaint and of the assignment of J.S. Brice, attorney, indorsed on said note."
In his decree, Judge Featherstone made the following finding:
"The record shows that Mr. J.S. Brice, who at that time was a well-known and reputable attorney of the York Bar, had been Mrs. Neely's trusted agent and attorney in regard to loaning and collecting her funds for a number of years."
In addition thereto, the Circuit Judge, at the conclusion of his decree, said:
"I am satisfied from the consideration of the whole record with the conclusions reached by the Referee. * * * "
This case is controlled, in my opinion, very much by the cases of Leaphart v. Selby, 135 S.C. 1; 133 S.E., 451.Cogswell v. Cannady, 135 S.C. 365; 133 S.E., 834. Hugginsv. McFadden, 135 S.C. 409; 134 S.E., 35. Land v.Reese, 136 S.C. 267; 134 S.E., 253. Marston v. Rivers,138 S.C. 295; 136 S.E., 222. Miles v. Gadsden, 139 S.C. 52;137 S.E., 204, and Miles v. Felkel, 139 S.C. 95;137 S.E., 329. In all of these cases there had to be a loss to one of the parties due to the fraudulent conduct of an attorney *Page 306 at law. Two principles run through all of these cases, which appear in the syllabi from the Leaphart case as follows:
(1) "Where mortgagee held out firm of attorneys as money lender with general authority to act, he cannot assert to the contrary after mortgagor had made payments through such firm."
(2) "Where one of two innocent persons suffers by wrongful act of third, one most at fault is required to bear loss."
In the case of Huggins v. McFaddin, the decision of this Court was in favor of the mortgagee; it being held that the money paid by the mortgagor to the attorney was paid to his agent and not to the agent of the mortgagee, and the opinion of the Court was unanimous. In all of the other cases last cited, the decisions of this Court were in favor of the mortgagors; it being consistently held that the respective attorneys were the agents of the mortgagees. In all of these cases Mr. Justice Cothran dissented, and the chief ground of his dissent was, in most instances, based upon the principle, as stated by him in Leaphart v. Selby, "That a debtor owing money on written security, who pays it to another as the agent of the holder of the security, must see that theperson so paid is in the possession of the security, or has authority, * * * to receive such payment." (Italics added.)
In several of these cases, the proof was that the attorney did not have possession of the security for the debt at the time he made the collection of the principal, and in most of the cases there was conclusive proof of an absolute assignment of the security to a third party; the assignment appearing upon the paper without cancellation or mutilation thereof.
The position of the respondents in the case at bar meets all the requirements of the law as laid down by a majority of this Court in the cases referred to. The respondentshave also met the main test required by Mr. Justice Cothran *Page 307 in his former dissenting opinions, since it was established beyond doubt that, at the time the money was paid to Mr. Brice, he was in possession of the security.
This case is almost on all fours with the very recent case of Mortgage Acceptance Corporation v. Stewart, 142 S.C. 375;140 S.E., 804. The decision of the Court in that case was unanimous in favor of the mortgagor. There Stewart purchased an automobile from Floyd Motor Company, and gave as part payment of the purchase price a mortgage on the car made direct to the Mortgage Acceptance Corporation. The mortgage was left in possession of Floyd Motor Company by the mortgagee, and from time to time Floyd Motor Company collected from the mortgagor payments on the debt, until the whole of the debt had been collected. Floyd Motor Company failed to remit all the money to the mortgagee, and the mortgagee attempted to make collection of the balance due it from the mortgagor. This case is even stronger than the case last mentioned, for here the mortgage was not taken originally to the plaintiff, as was done in the last-mentioned case.
There is much similarity between the facts of this case and those of Mortgage Co. v. Gillam, 49 S.C. 345;26 S.E., 990; 29 S.E., 203. In that case, Corbin Banking Company, the mortgagee, assigned to the mortgage company certain notes and a mortgage, which secured the payment of the notes. Corbin Banking Company continued to collect the interest and transacted all the correspondence with the mortgagors pertaining to the matter. This Court held that there was sufficient proof of agency of Corbin Banking Company for the assignee, and held the assignee responsible for acts of the Corbin Banking Company.
Even if Mr. Brice's acts were wrongful and a fraud on the plaintiff, the plaintiff, having reaped some benefit therefrom, *Page 308 was bound by his acts, for it has been decided by this Court:
"A principal is liable for the wrongful acts of his agent while acting within the apparent scope of his authority, even when committed against the principal's instructions, and he cannot benefit from such acts to the prejudice of an interested third party dealing with him." Williams v. PhiladelphiaLife Ins. Co., 105 S.C. 305; 89 S.E., 675.
Again, I call attention to the fact that the evidence in this case shows that Mr. Brice had been handling money of the plaintiff for many years, and that on several occasions he had even signed her name, without objection on her part, to satisfactions of real estate mortgages. If Mr. Brice had the authority, or apparent authority, to sign a satisfaction of a mortgage, he certainly had the authority, or apparent authority, to assign the mortgage without recourse, or to strike out an assignment appearing thereon. At least, this was a question of fact, and there is plenty of evidence to warrant this Court in properly holding that he had that authority, or apparent authority. Mr. Brice's acts clearly amounted to declarations on his part that he had the authority to transfer the paper to Colonel Gaston, and complete authority to strike out the assignment which appeared on the paper. General agency may be shown by the declarations of the agent connected with ratification of his acts by his principal. Buist Co. v. Mercantile Co., 73 S.C. 48;52 S.E., 789.
It was held in Thompson v. Shaw Motor Co., 128 S.C. 171;122 S.E., 669, that, where a general agent was acting within the scope of his actual or apparent authority in executing a note, his principal was liable on the note. If a principal can be held under the rule of apparent authority for a note executed by his agent, I do not see why the Court should not hold that likewise the principal can be held for an assignment of a note executed to the principal or owned by him. *Page 309
If Mr. Brice had signed the name of Mrs. Neely to the assignment of Colonel Gaston, under the evidence of this case there were sufficient facts and circumstances to show that he had apparent authority, if not the actual authority, to so do. If he had taken that course in the matter, Mrs. Neely would clearly have been bound by his act. She would have lost her money just the same. Since Mr. Brice could have taken the suggested course, and thereby bound Mrs. Neely, the result would have been the same to her. And, since he could have adopted the mode suggested and bound her, what difference does it make that he proceeded in another manner to effect the same result?
The case of Freeman v. Bailey, 50 S.C. 241;27 S.E., 686, referred to by Mr. Justice Cothran, is easily distinguished from the case at bar. In this case, the papers being made only to Mr. Brice as attorney did not disclose for whom he acted, and, even if inquiry had been made of him under the circumstances, the probability is that the inquirers would have simply been told that he had full authority to act in the matter. In the Freeman case the note was made to a public official, the probate judge of Greenville County. It was distinctly pointed out by the Court in that case that the Probate Judge had no authority to assign the note without the approval of the Court of Common Pleas. One dealing with a public official is charged with full knowledge as to the law pertaining to such official's acts and his right to act. There is quite a distinction between the acts of a public official and those of a private agent or attorney.
In my opinion, the case of Wilson v. Brabham, 126 S.C. 273;119 S.E., 829, has little or no bearing upon the issues of this case. In that case, the assignor of the note and mortgage, the bank, was at no time the agent of the assignee of the papers. After the bank had assigned the note and mortgage, and was not in possession of the papers, the bank executed a satisfaction on a separate paper. In this case, there *Page 310 was evidence of Mr. Brice's agency, and the papers were in his custody.
Much stress is laid in the dissenting opinion upon the use by Mr. Gaston of the words "by your clients" in his letter to Mr. Brice directing that the mortgages be assigned and forwarded with the draft for the amount due. Reference to that letter will show that Mr. Gaston used the plural "mortgages." Mr. Brice not only held for collection the mortgage which was payable to himself as attorney, but he also held a mortgage payable to one Carroll. It is clearly evident that Mr. Gaston wanted Mr. Brice to attend to proper assignment of all mortgages in his charge.
Even if Mr. Brice did not have the authority to collect the money due the plaintiff on the mortgage at the time he made the collection, by whatever manner it may have been collected, if the plaintiff thereafter ratified his act, she must be bound thereby. The evidence shows that the plaintiff, after the death of Mr. Brice, filed her claim against Mr. Brice's estate for the very money which Mr. Brice had collected from Colonel Gaston on the mortgage of the land in question. This Court has held in two recent cases that, where the mortgagee filed claim against the estate of her agent, or supposed agent, for money collected by such agent on the mortgage debt, such conduct on the part of the mortgagee was evidence of ratification of the agency to collect the money. Miles v. Gadsden, 139 S.C. 52; 137 S.E., 204.Miles v. Felkel, 139 S.C. 95; 137 S.E., 329.
But the dissenting opinion takes the position that the propositions of ratification received "scant attention" in both of the cases cited. I do not see how this statement can be justified when only one point was considered in Miles v.Gadsden, and, according to the syllabus, was decided as follows:
"Where mortgagee, after learning of payment by mortgagor to a supposed agent who had not remitted to mortgagee, filed a claim for the amount of such payment against *Page 311 the estate of such agent, such act constituted a ratification of the payment to the agent precluding recovery against the mortgagor after agent's estate was found to be insolvent."
But it is urged by Mr. Justice Cothran that, as the Special Referee and Circuit Judge did not touch upon the question of ratification of Mr. Brice's act by the plaintiff, this question is not properly before the Court. The case of Miles v.Gadsden had not been decided at the time the Circuit Judge heard this cause. In all probability, if the decision had been handed down prior to the hearing in the Circuit Court, the Circuit Judge would have referred to it. But, even, if the matter of ratification was not considered in the lower Court, this Court may sustain the judgment of the Court below upon other reasoning, or, on other grounds, properly appearing in the record of the cause, than those employed by the Circuit Judge in his decree. State v. Beaufort, 39 S.C. 5;17 S.E., 355.
Mr. Justice Cothran concedes as the very basis of his opinion, "Both (plaintiff and defendants) are perfectly innocent of wrongdoing; * * *" and that the issue here "is to be determined by the answer to the question, which was the more to blame in furthering the misappropriation of the money by Mr. Brice." There is not a particle of evidence to show that the defendants who purchased the land in this action ever had any dealings whatever with Mr. Brice, except such as were conducted by Colonel Gaston.
The Special Referee, W.J. Cherry, Esq., a lawyer of ability and large and varied experience, who saw all the witnesses as they testified, has found that the respondents were absolutelyinnocent of blame. In this finding, Judge Featherstone, with years of experience as a trial Judge, and thereby an able investigator of facts, has concurred. I shall notpresume that they were wrong and that I am wiser than they are.
All the facts show that the intention of all the interested parties was that the mortgage debt should be paid, and it was *Page 312 handled through the assignment to Colonel Gaston as a matter of convenience and safety until the whole deal could be consummated. As a matter of kindness to his clients, Colonel Gaston arranged the matter temporarily, and assisted the mortgagors of the land to meet the urgent demands of Mr. Brice, the agent and attorney of Mrs. Neely, that the mortgage debt be settled. I cannot bring myself to believe that the respondents, or the original mortgagors, or Colonel Gaston, should be made to suffer for an act of kindness performed by the latter. The evidence convinces me entirely that Mr. Brice was agent for the plaintiff-appellant "to put out" (using her own language) her money and to collect it for her. Unfortunately for this good woman, she trusted Mr. Brice too far. Her confidence in him caused others to have confidence. The latter should not be held blamable that she pointed the way.
In answer to the question asked in the dissenting opinion, "Why should this Court be influenced by the opinion of the Court below on a question of fact in an action in equity?" I call attention that the burden is always on the appellant to show that the Court below erred in a finding of fact. Moreover, I am firmly of the opinion that this Court should always hesitate to reverse a Circuit Judge on questions of fact. Under the Constitution of this State, men who sit in the Circuit Court as judges are required to have the same qualifications, as men and as lawyers, as are required of members of this Court. They are presumed to be indifferent in the causes which they hear. They have some advantages in ascertaining the credibility of witnesses which this Court does not possess. With some exceptions, the Judges of the Circuit Court have had much more experience than members of this Court in passing upon questions of fact, and because of that experience and peculiar training, they are really better fitted to pass upon such questions than Supreme Court Justices, who have had less experience in determining issues of fact. The question asked is easily *Page 313 answered by other questions: If this Court is not to be influenced by the findings of fact by a Circuit Judge, why bother to take up the time of the Circuit Court and the litigants in hearing these causes in that Court? Why not let the equity causes come direct to this Court? The framers of the Constitution thought best to let Circuit Judges pass on these causes first. I think the plan outlined in the Constitution is best, and, even if I thought it wrong, I would bow to the power and wisdom of those who ordained the provisions contained therein.
I am frank to say that I have not taken, and have not had, the time required to examine into all the 50 cases "from the four winds," which may sustain some of the propositions advanced in the dissenting opinion. I find that cases from the "four winds," like the winds themselves, because of varyings in their facts, blow in every direction. Neither have I undertaken to read the "50 more cases" which are referred to in the Century, Decennial, and Annual Digests, under the appropriate key numbers. I am aware that these publications are valuable compendiums of quick information to point to cases which bear upon the subject one may wish to investigate. Their publishers justly claim that they give the key practically to every decision rendered anywhere in the United States which has ever been published. I have learned that, because of their very completeness, they have caused the hearts of attorneys for losing litigants to beat with much hope for reversal in the Supreme Court, and that they bring great comfort to the authors of dissenting opinions. "As for me and mine," I shall endeavor first of all to stand by what I conceive to be the law as laid down by our Court. Without even going to the trouble to cite any authority to sustain the proposition, I am keeping in mind thatelementary principle of the law, so often announced by this Court, that the principal must be bound by the acts of his agent, and also by the acts of his agent acting in the apparent scope of his authority. Without even looking into *Page 314 the valuable Digests referred to, I am bold to say that at least 50 times 50 cases can be found therein to sustain this plain principle of the law. Exceptions, modifications, explanations, refinements, and distinctions, all put together from whatever winds they may come, cannot, should not, and will not, shake this bedrock of the law.
I agree fully with the decree of Judge Featherstone, and what I have said is in addition to his decree.
MR. ACTING ASSOCIATE JUSTICE THURMOND concurs.