Eng v. Cammann

Lehman, J.

The defendants are a firm of stock brokers. The plaintiff had an account with them, dealing through a branch office where one Vincent Goodwin was employed as manager. The plaintiff was accustomed to give buying and selling orders to the manager who transmitted them to the defendants for execution. There is no dispute that all such orders were binding on the defendants. On April 2, 1912, Goodwin told the plaintiff that he could make a few dollars for her that she had lost in other transactions, and thereupon the plaintiff gave Goodwin the following written authority:

‘ Cammann & Co.:

“ This letter authorizes you to accept buying and selling orders for my account from Mr. Vincent Goodwin.

“ (Signed) Mrs. John Eng.”

This letter was apparently transmitted to the defendants through Goodwin and thereafter the defendants accepted from Goodwin, their manager, orders signed by him for the plaintiff. Subsequently the plaintiff notified Goodwin that she wished all transactions for her account to cease and that her account should be closed. Goodwin, however, continued to give orders in the plaintiff’s name to the defendants without informing them of the revocation of his authority and the defendants continued to execute the orders. The plaintiff has now recovered judgment upon the theory that the notice to Goodwin of the revocation of his authority was notice to the defendants.

I think that the evidence sufficiently shows that the letter of authority signed by the plaintiff, though delivered to Goodwin, was intended to be shown to the defendants. Goodwin as manager of the defendants’ branch house, in my opinion, had no implied or apparent authority to accept discretionary authority from customers, placing upon him the double duty of representing the customer in giving the order and the defendants in transmitting the order. The written authority was necessary in order to enable him to show the defendants that he had the right to bind the plaintiff when he transmitted orders made by himself in her behalf and the defendants could, upon the receipt of that written authority, have refused to receive such orders on the ground that his assumption of a discretionary agency for a customer was inconsistent with his agency of their firm as manager. With knowledge, however, of this new relationship they continued to allow their manager to deal with the plaintiff, not only as her personal agent but as their manager, and by virtue of the dual relationship thus created, when the plaintiff revoked her previous authority, the notice given to Goodwin of this revocation was also a notice to the defendants given to their manager acting within •the scope of his duties. Even though it should be said that Goodwin acquired this notice not as manager for the defendants but as the plaintiff’s agent, yet, when thereafter he assumed to transmit orders made by himself as agent, he was acting within the scope of his duties as manager of the defendants and his knowledge of the actual facts acquired by him in any manner was the knowledge of the defendants. The defendants, having placed Goodwin in a position where he was their representative for the purpose of obtaining and transmitting orders, are bound by notice to Goodwin in every matter coming within the scope of these duties.

I concur, however, in the view of Mr. Justice Bijur that the judgment should be reversed because of the erroneous and insufficient charge on the issue of accord and satisfaction. The plaintiff, after dispute with the defendants in regard to these transactions of Goodwin, received from the defendants a statement of the account and a check in full for balance and she deposited this check without any direct communication with the defendants. By presenting this proof, the defendants concededly presented prima facie proof of accord and satisfaction. To meet this, the plaintiff produced the testimony of her husband that he used this check only after some conversation with the manager Goodwin in which Goodwin stated that the plaintiff’s claim would be made good. If this conversation was held with Goodwin as the agent of the defendants and his statement was intended and was understood to be the defendants’ promise, then of course the retention of the check by the plaintiff in reliance upon this promise would constitute no accord and satisfaction. In view, however, of the fact that the plaintiff’s husband claims to have made the alleged protest to Goodwin when he knew that the dispute between plaintiff and defendants referred to misconduct of Goodwin as the defendants’ agent and of the further fact that Goodwin in that conversation concededly said “ I ” as well as “we” will make good, it is at least a question whether the plaintiff’s husband was not at the time dealing with Goodwin individually and not as the defendants’ manager. This issue was never submitted to the jury and it follows that the judgment should be reversed and a new trial ordered with costs to appellants to abide the event.

Seabury, J., concurs :