In form, the railroad, in the present case, appears to have pursued the letter of the law, in the matter of advertising and selling the packages or barrels, for the payment of the freight charges. We say the railroad, for all this was the act of the railroad, although in fact done through its agents or employes. To the railroad corporation the freight charges were due, the freight was in the railroad’s depot, and the cor*121poration, or its appointee or agent, could make tire sale. Corporations act by their agents or officers.- — Code of 1876, §§ 2140 et seq.
But in making such sale, good faith and reasonable diligence must be observed. The agent or agents entrusted with the •duty, must have employed reasonable diligence in ascertaining the contents of the barrels; and if they had information of what the contents were, or could have acquired such information with reasonable diligence, then it became their duty to give notice of it, so as to effect the best sale they could. This was their duty to the owners of the freight, and to the railroad corporation. If, knowing the contents of the barrels, or having good reason for believing what they were, the agent selling withheld such knowledge, or well founded belief, and the effect was that the barrels were sold to a favorite, having superior knowledge, and at a nominal price, this was a fraud which would subject the perpetrators of it to an action for the damages, at the suit of the party injured. The law will not sanction or excuse such faithlessness in an agent.-Sarjeant v. Blunt, 16 Johns. 74; Wright v. Spencer, 1 Stew. 576.
The Circuit Court ruled, in this case, that the advertisement under which defendants effected the sale was insufficient, in that it did not describe the contents of the barrels; and that in order to give a proper description, “the defendants had the right to examine the contents of the barrels.” The description given in the advertisement was “two barrels wet.” The testimony was. that this was the description given of the barrels ■ in the bill of lading which accompanied them. We feel justified in inferring that this description was intended to indicate the contents, as distinguished from dry barrels. These were wet barrels, in the classification of freight. In two respects the Circuit Court erred: First, in holding, as matter of law, that the advertisement was insufficient ; and, second, in ruling that the defendants were authorized to examine the contents of the barrels. As we have said, reasonable diligence and good faith were exacted. Reasonable diligence implies that the agent should have examined all external indicia and marks, the odor of the barrels, if they emitted an odor, and all other sources of information, reasonably within his reach. If, from these sources, or from any information he may have received, he knew, or could have known the contents with proximate accuracy, then his conduct in advertising as he did was culpable. He should have informed the public of all he knew, or could have learned with reasonable diligence. ITe stood in the relation of agent, both to the railroad corporation and to the owner of the barrels, and he owed to each of them good faith. He had no authority to open the barrels to ascertain their contents. *122Whether he acted with reasonable diligence in ascertaining the contents — whether he knew, could have learned, or had just grounds for believing what were the contents, and whether he acted in good faith in giving the notice and making the sale, were questions for the jury, under appropriate instructions embodying the principles above declared.
Shivers testifies he bid iu the barrels for Fowlkes, at whose instance he advertised and made the sale. Being his agent or employe both to sell and buy, we need'not inquire as to the separate liability of Fowlkes.' The same duties and liabilities rested on the latter, as did on the mere instrument by which he effected the sale.
Reversed and remanded.