An agent must obey instructions and is personally responsible for losses resulting from disobedience and may be discharged for disobedience.
47. Blank v. Aronson, 187 Fed. 241.
48. Davis v. Hamlin, 108 111. 39.
While it is of course true that a principal by giving instructions to his agent cannot thereby enlarge the agent's duties beyond those he has expressly or impliedly promised to give, the agent must not disobey reasonable and material instructions given by the principal as to modus operandi.
Example 13. An agent is instructed to ship by one route. He ships by another. Loss ensues by "Act of God." The agent must answer.49
It is true that in emergencies where the agent cannot communicate with the principal for advice, he may not only disobey instructions, but is under a duty to do so, where the emergency requires, as where a principal believing a certain bank to be sound has directed deposits to be made therein, and the agent before making a deposit discovers it to be on the eve of failure. Here he must know that the principal is acting under a misapprehension.50
If an agent is negligent in the pursuit of his duties, he will be responsible for loss if loss occur. What constitutes negligence depends on the circumstances.
An agent must act with reasonable diligence and skill. If he is negligent in doing the work intrusted to him he is responsible for the losses thereby occasioned. Thus, if an attorney at law undertakes to collect a claim, and does not act with reasonable promptness and loss thereby results, he may be held responsible for the consequences.
49. Johnson v. N. Y. Cent. Transp. Co., 33 N. Y. 610.
50. Mechem, Agency, 2nd Ed. SEC. 1262.
What constitutes reasonable diligence depends upon the circumstances. One who does not profess to be an expert or skilled at all in the line in which he is employed cannot be held to the high standard of skill and care that is to be expected from one who makes skill in such work a profession. If I employ one whom I know to be a common laborer, to do, say, plumbing work, in my residence, I cannot hold him responsible where I might hold a professional plumber.
50, agents employed to sell on credit must use reasonable care to select solvent buyers; and wherever discretion is required the agent must act with prudence and caution.
If an agent acts gratuitously, he may or may not be required to use the skill which would be required in a paid servant, according to circumstances. If one professes to have skill in some work, and bestows that work without any reward, the lack of reward is of no moment. Thus a physician giving his services free in a matter in which he professed to have particular skill, must not be any more negligent than if he expects to receive a reward. But if one does an act merely as a favor, professing no peculiar skill therein, he will be held only to the exercise of good faith.
The following example is from a case in which the duty of care and prudence was applied.
Example 14. P employs A to invest money for him. P is an attorney at law. He puts it in an unsafe second mortgage whereby A sustains loss. A is responsible.51
An agent cannot delegate to others the duties imposed upon him, except those of a purely ministerial character where by reasonable implication such ministerial acts are not expected of him personally.
51. Whitney v. Martin, 88 N. Y. 535.
"Delegata potestas non potest delegari" (A power delegated cannot again be delegated.) That which the agent is appointed to do he cannot appoint another to do for him unless he has been given that right in the appointment. The agent has been selected for personal reasons and must perform the work himself. This does not prevent an agent from employing clerks or sub-agents to help him where that is the reasonable inference from his appointment, the agent remaining liable for their defaults. Ordinarily any ministerial or merely clerical duty can be performed by the agent's clerks or subagents,52 but their defaults are the defaults of the agent. Purely ministerial acts, even, cannot be delegated if the purpose of appointing the agent (or servant) is to perform them, as where one is employed to do manual labor.
If agent is selected to accomplish a certain object, he cannot delegate his responsibility, but if he is merely selected to obtain another agent to accomplish such object, his duty is performed when he has used reasonable care to select such an agent, and he is not answerable for that agent's defaults.
As seen in the last section, an agent's discretionary duties are not delegable, and when within the contemplation of the authority he has clerks or subagents to help him, he is responsible for their acts, as such acts are his acts. But the object for which he is employed may be to obtain an agent for the principal, and in that
52. Eldredge v. Holway, 18 111. 445.
56 Law ok Agency.
case obviously his use is fulfilled when he has obtained such an agent, and that agent is then the agent of the principal. But the fact that it is known that he will employ others to help him does not make the act any less his.
Example 15. P employs A, a collection agency, to collect accounts, in the collection of which he knows that A will employ lawyers located at the point of residence of the debtor. A is liable for a default by an attorney employed by him.53
If a bank receives commercial paper for collection, in which it is known it will employ correspondents some authorities hold that the correspondent bank is the agent of the holder of the paper, and some that it is a subagent of the first bank for whose defaults such first bank is liable.
P employs A, a bank in Chicago, to collect a note payable in New York City. P knows and expects that A will send- the note to a New York correspondent. If this New York correspondent is negligent in presenting the note for payment, whereby loss ensues, is the Chicago bank liable, or must the principal have his recourse against the New York bank, and if that fails, be without remedy? It is simply a question whether the New York bank is to be regarded as an agent of the Chicago bank or an agent of P secured for P by the Chicago bank. The courts are at variance on this question. In Colorado, Georgia, Kansas, Michigan, Minnesota, Montana, New Jersey, New York, Ohio, and some other states, and in the United States Supreme Court, the rule prevails that the correspondent bank is the agent of the bank employing it and that the latter is responsible to the client for the negligence of the former. In Alabama, California, Connecticut, Florida, Illinois, Indiana, Iowa, Louisiana, Maryland, Massachusetts, Mississippi, Missouri, Nebraska, Pennsylvania, and Tennessee, the rule is otherwise. In such a case the owner of the paper must look to the correspondent bank, provided the employing bank used 'due care in selecting the agent. If that agent becomes insolvent, the client is without remedy for its negligence in presenting the paper. This is the rule most broadly adopted.54
53. Weyerhauser v. Dunn, 100 N. Y. 150.
There may be a special agreement in any event that the bank shall not be liable for the negligence of the subagent.