§ 236. Where the agent receives no instructions, he must conform to the usage of trade or the custom applicable to the particular agency; and any deviation therefrom, unless it be justified by the necessity of the case, will render him solely liable for all the loss or injury resulting from it.5 Thus, if an

1 Park v. Hammond, 6 Taunt. 495; s. c. 4 Camp. 344.

2 Catlin v. Bell, 4 Camp. 183; Dusar v. Perit, 4 Binn. 361; 3 Chitty on Com. and Manuf. ch. 3, p. 218; Story on Agency, § 193-197.

3 See Wilson v. Wilson, 26 Penn. St. 394; Scott v. Rogers, 31 N. Y. 676; Johnson v. New York Central Railroad, 31 Barb. 198.

4 Cornwal v. Wilson, 1 Ves. 519; Smith on Merc. Law, B. l,ch. 5, § 2; 3 Chitty on Com. and Manuf. ch. 3, p. 219, note 1; Story on Agency, § 85,198.

5 Story on Agency, § 96, 185, 199; 3 Chitty on Com. and Manuf. ch. 3, p. 215, 216; Young v. Cole, 3 Bing. N. C. 724; Belchier v. Parsons, Ambler, agent should sell upon credit, when the usage was to make such sales for cash; or should omit to present notes taken by him, for payment; or should allow further time for the payment of them, after they become due; he would be personally responsible.1 So, also, the same rule would apply, if in insuring goods, he should omit the usual clauses inserted in a policy, and a loss should occur which would have been covered by such clauses.2 So, also, if, following the usage, he should appoint a sub-agent, the sub-agent would in like manner be responsible to the principal or agent for reasonable diligence and skill. But, if the agent used reasonable diligence in appointing him, he would not be responsible for the sub-agent's neglect or fraud.3 Yet, if the compliance with such usage would, in a particular case, be injurious to the interests of his principal, he will not only not be bound to comply with it, but if he do, knowing that it will be productive of injurious results, he will render himself personally liable therefor.4 Thus, if an agent should store the goods of his principal in a place which he knew to be dangerous and improper, he would not be justified, although similar goods were usually stored in similar places.

§ 237. An agent is also bound to keep regular accounts and vouchers of all transactions occurring in his agency; and if any loss accrue, through his neglect so to do, he will be liable therefor in equity.1 So, also, an agent must keep his own property distinct from that of his principal; for if, through his negligence, he be unable to distinguish one from the other, the whole will be considered as the property of the principal, as a species of penalty for his negligence.2 Thus, if an agent should deposit funds belonging to his principal in a bank, in his own name, and without any mark to distinguish them as belonging to his principal, and the bank should become insolvent, he would be liable for the loss.3 All the profits made by an agent in the course of his agency, whether incidental or direct, enure to the benefit of his principal. No agent can appropriate any incidental profit arising therein, although he be justified in so doing by usage; for such usage is considered a usage of fraud and plunder. Thus, if an agent have made interest on his principal's money in his hands, he will, in general, be obliged to account for it.4 He is, therefore, restricted to a proper compensation; and the profits, however they may accrue, must be passed to the credit of the principal.5

219, 220; Russell v. Hankey, 6 T. R. 12; Caffrey v. Darby, 6 Ves. 496; Massey v. Banner, 1 Jac. & Walk. 241; Moore v. Mourgue, Cowp. 480; Smith v. Cologan, 2 T. R. 188, note a; Warwicke v. Noakes, Peake, 68; Paley on Agency, by Lloyd, 9, 10, 21, 45, 46, 47, 204, 205, 209, 3d ed.; 2 Kent, Comm. lect. 41, p. 622 to 624, 3d ed.

1 Littlejohn v. Ramsay, 4 Martin (n. s.), 655; Gilly v. Logan, 2 Martin (n. s.), 196; Hosmer v. Beebe, 2 Martin (n. s.), 368; Richardson v. Weston, 4 Martin (n. s.), 244; Leverick v. Meigs, 1 Cow. 646; Caffrey v. Darby, 6 Ves. 494; 1 Liverm. on Agency, ch. 8, § 2, p. 368; ib. 354.

2 Mallough v. Barber, 4 Camp. 150. See also Comber v. Anderson, 1 Camp. 523; Park v. Hamond, 4 Camp. 344; s. c. 6 Taunt. 495; Walker v. Smith, 4 Dall. 389.

3 Mainwaring v. Brandon, 8 Taunt. 202, 204; Bromley v. Coxwell, 2 Bos. & Pul. 438; Cockran v. Irlam, 2 M. & S. 301; Goswill v. Dunkley, 2 Str. 680; Paley on Agency, by Lloyd, 17, 20; 1 Liverm. on Agency, ch. 2, § 4, p. 56 to 67; Story on Agency, 201, and note 2.

4 Sadock v. Burton, Yelv. 202; Anon., 12 Mod. 514; 3 Chitty on Com. and Manuf. ch. 3, p. 215, 216, 218, note 1; 2 Molloy, B. 3, ch. 8, § 5; Story on Agency, § 199.

§ 238. When a factor guarantees payment on a sale, in consideration of an additional recompense, he is said to receive a del credere commission, and in such case, upon failure of payment by the purchaser, he himself becomes liable personally. But an agent under such a commission is only understood to guarantee the payment of the money by the purchaser, and not the safe remittance of it to the hands of the principal.1

1 White v. Lady Lincoln, 8 Ves. 363; s. c. 15 Ves. 441; Chedworth v. Edwards, 8 Ves. 49; Paley on Agency, by Lloyd, 48, 49; 1 Story, Eq. Jur. § 468, 623; 1 Liverm. on Agency, ch. 8, § 7, p. 434 to 436; Smith on Merc. Law, 94; Gallup v. Merrill, 40 Vt. 133 (1868); Boston Carpet Co. v. Journeay, 36 N. Y. 384 (1867).

2 Fletcher v. Walker, 3 Madd. 73; Wren v. Kirton, 11 Ves. 379, 382; Lupton v. White, 15 Ves. 432; Paley on Agency, by Lloyd, 48, 49, 51; 1 Beawes, Lex Merc. Factors, p. 44, 46; Chedworth v. Edwards, 8 Ves. 49;

3 Chitty on Com. and Manuf. ch. 3, p. 215, 220; Story on Agency, § 205.

3 Caffrey v. Darby, 6 Ves. 496; Massey v. Banner, 1 Jac. & Walk. 241; 4 Madd. 413; Wren v. Kirton, 11 Ves. 377, 382; Macdonnell v. Harding, 7 Sim. 178; Darke v. Martyn, 1 Beav. 526; Fletcher v. Walker, 3 Madd. 73.

4 Rogers v. Boehm, 2 Esp. 704. See Leake v. Sutherland, 25 Ark. 219.

5 Story on Agency, § 207; 3 Chitty on Com. and Manuf. ch. 3, p. 216, 221; Diplock v. Blackburn, 3 Camp. 43; Massey v. Davies, 2 Ves. Jr. 317; ------v. Jolland, 8 Ves. 72; Paley on Agency, by Lloyd, 3, 4; Smith on Merc. Law, 94; Lafferty v. Jelley, 22 Ind. 471.

§ 239. Whenever an agent violates his duties and obligations to his principal, and loss accrues, either directly or indirectly, as a consequence of his neglect or misconduct, he will be liable to his principal. Thus, if an agent should knowingly deposit goods in an improper place, and they should be destroyed there by fire, he would be responsible for the loss, although it were the direct consequence of the fire and not of his negligence.2 So, if an agent neglect to procure insurance when he is bound to do so, he is responsible for any direct consequence, entailing a loss.3 But although it is not necessary that such a loss should be the immediate result of such misconduct, yet it must actually have resulted therefrom, and not be merely a possible or probable result thereof.4 Thus, although an agent be ordered to make sales on a certain credit, and he actually makes them on a longer credit, and yet, before the period allowed by the orders elapse, the vendee fail, the agent would not be responsible, because the loss would have occurred if he had obeyed his instructions.5 But if a voyage be properly insured, and the ship deviate therefrom, or if the ship be lost by a risk which would not have been covered by a policy made in accordance with the order, or if the insurance be illegal, the agent would not be liable, although he should violate or neglect his orders.6

1 Leverick v. Meigs, 1 Cow. 645; Heubach v. Rother, 2 Duer, 253. But see Mackenzie v. Scott, 6 Bro. P. C by Tomlin, 286; 1 Liverm. on Agency, 408 to 411; Lucas v. Groning, 7 Taunt. 164; Story on Agency, § 215.

2 Paley on Agency, by Lloyd, 10, 19, 20, 21, 75, 76; Caffrey v. Darby, 6 Ves. 496; Davis v. Garrett, 6 Bing. 716.

3 Wallace v. Tellfair, 2 T. R. 188, note; Smith v. Lascelles, 2 T. R. 187; Delaney v. Stoddart, 1 T. R. 24; Morris v. Summerl, 2 Wash. C. 0. 203; De Tastett v. Crousillat, 2 Wash. C. C. 132, 136; Parker v. James, 4 Camp. 112. But an agent is not bound to insure for his principal unless expressly instructed so to do; or unless an understanding to that effect exists between them. Lee v. Adsit, 37 N. Y. 78 (1867).

4 Story on Agency, ch. 8, per tot. and cases cited.

5 Paley on Agency, by Lloyd, 19, 20, 21, 74, 75; Story on Agency, §222.

6 Marsh, on Ins., B. 1, ch. 8, § 2, p. 300; Delaney v. Stoddart, 1 T. R.

§ 240. Where an agent is authorized to receive payment of a debt, he is bound to receive the whole of such payment in money; unless he have a special authority to receive payment in a different mode; or unless such authority is to be inferred from circumstances;1 or from usage; as in the case of factors, who are allowed by usage to sell on credit.2