This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Communications between principal and agent, not communicated to the third person with whom the principal contemplates making a contract, or at least not communicated with the authority of the principal and with the intention on his part of making an offer to such third person, do not constitute offers, even if such third person has learned of such communications and has attempted to act upon them.1 Instructions sent by the owner of realty to an agent fixing the price at which the owner would sell such realty, do not of themselves amount to an offer to a prospective purchaser.2 If a policy of insurance is sent by the insurance company to the agent of the insured, a letter from the insured to such agent, authorizing him to pay for such policy, is not an acceptance.3 Thus a report of a town committee appointed to consider a claim against the town, which fixes the amount of the claim, and which is accepted by the town,4 or a vote of a town instructing its selectmen to pay a certain alleged claim,5 are not offers in the technical sense. The fact that A makes a declaration to X of A's intention to marry B and that X communicates such declaration to B, does not amount to an offer of marriage from A to B, if X was not authorized by A to communicate such declaration.6 In cases in which the declaration of intention has been made to a third person who is not authorized to represent the person who declares such intention in communicating it to the adversary party, such declaration is defective in at least two respects: (1) It does not show an intention on the part of the person who makes such declaration to assume liability to such adversary party,7 and (2) such declaration has not been communicated to the adversary party by the person who made it, or by any one authorized by him. An offer may be communicated by the authorized agent of the offeror as well as by the offeror himself.8 This is so well settled that litigation arises only where there is a question as to the authority of the agent,9 or as to the fact of his having communicated such offer. Accordingly, if A makes an offer to B through A's agent X, evidence which tends to show that X communicated A's offer to B, is not hearsay.10
13 Wells v. Black, 117 Cal. 157, 59 Am. St. Rep. 162, 37 L. R. A. 610, 48 Ac. 1090.
14 Tate v. R. R., 78 Miss. 842, 84 Am. St. Rep. 649, 29 So. 392.
15 Iowa. Marr v. Burlington, C. R. & N. Ry. Co., 121 la. 117, 96 N. W. 716; Jacobs v. Jacobs, 130 la. 10, 104 N. W. 489; Shahan v. Bayer Vehicle Co., 179 la. 923, 162 N. W. 221; James McCoy Co. v. Smith, 181 la. 707, 165 N. W. 88.
Maine. Price v. McEachern, 111 Me. 573, 90 Atl. 486.
New Hampshire. Bisbee v. Pulpit Farm Dairy, - N. H. - , 100 Atl. 672.
Pennsylvania. Dimmick v. Banning, 256 Pa. St. 295, 100 Atl. 871.
Washington. Lilly v. Lilly, 39 Wash. 337, 81 Ac. 852.
16 Price v. McEacbern, 111 Me. 573, 90 Atl. 486; Dimmick v. Banning, 256 Pa. St. 295, 100 Atl. 871.
17 Shahan v. Bayer Vehicle Co., 179 la. 923, 162 N. W. 221; Dimmick v. Banning, 256 Pa. St. 295, 100 Atl. 871.
18 Bisbee v. Pulpit Farm Dairy, - N. H. - , 100 Atl. 672.
19 Societe Anonyme Pour la Fabrication de la Soie de Chardonnet v. Loeb, 239 Pa. St. 264, 86 Atl. 798.
20 Withers v. Moore, 140 Cal. 591, 74 Ac. 159.
21 See ch. XLIII.
1 Anderson v. Hall, 273 Mo. 307, 202 S. W. 539; Potter v. Hollister, 45 N. J. Eq. 508, 18 Atl. 204; Stengel v. Sergeant, 74 N. J. Eq. 20, 68 Atl. 1106.
2 Stengel v. Sergeant, 74 N. J. Eq. 20, 68 Atl. 1106.
3 New v. Germania Fire Ins. Co., 171 Ind. 33, 85 N. E. 703.
4 Bickford v. Hyde Park, 173 Mass. 536, 54 N. E. 250 [distinguishing Hall v. Holden, 116 Mass. 172; Nelson v. Milford, 24 Mass. (7 Pick.) 181.
5 Marsh v. Scituate, 153 Mass. 34, 10 L. R. A. 202, 26 N. E. 412.
6 Cole v. Cottingham, 8 Car. & P. 75;
Burnham v. Cornwell, 55 Kv. (16 B. Mon.) 284, 63 Am. Dec. 520; Tamke v. Vangsnes, 72 Minn. 236, 75 N. W. 217.
7 See Sec. 79.
8 England. Forman v. The Liddes-dale (1000), A. C. 100.
United States. Lucas v. Brooks, 85 U. S. (18 Wall.) 436, 21 L. ed. 779.
Alabama. Kramer v. Compton, 166 Ala. 216, 52 So. 351.
California. Gallagher v. Equitable Gas Light Co., 141 Cal. 699, 75 Ac. 329.
Colorado. Hagerman v. Bates, 24 Colo. 71, 49 Ac. 139.