Whether or not the plaintiff's performance, especially if it consist in the payment of money, results in a benefit to the defendant is a question likely to arise in cases of contracts entered into with unauthorized agents. When money borrowed by an unauand when the plaintiff received a contract which both parties supposed bound the firm, but which in fact did not bind the firm, the fact that the partner signing the firm name is held in law to have made an individual contract, does not change the fact that the plaintiff has not received the obligation for which he contracted, and has not therefore received the equivalent which he intended to exact and thought he was receiving. If the instrument delivered to the plaintiff bound no one, then without question the plaintiff would be allowed to recover in quasi-contract against the firm. Why should the fact that the law gives to him a right which he did not wish to obtain, and of which he does not desire to avail himself, lead to a denial of a similar right in the case under consideration?"

1 Stetson v. Patten, 1823, 2 Greenl. (2 Me.) 358; 11 Am. Dec. Ill; Abbey v. Chase, 1850, 6 Cush. (Mass.) 54.

2 See Debus v. Cawthorn, 1829, 2 Dev. L. (13 N. C.) 90, 98.

3 McCaulley v. Jenney, 1875, 5 Houst. (Del.) 32; Benham v. Emery, 1887, 46 Hun (N. Y. Sup. Ct.) 156. And see Osborne v. High Shoals Mining, etc., Co., 1857, 5 Jones' Law (50 N. C.) 177.

thorized agent actually reaches the legal possession of the principal, his receipt of a benefit is unquestionable.1 Such is the case where it is paid into his bank account or otherwise mingled with his funds.2 But it has been held that money placed by a city treasurer in a drawer provided by the city for his use in keeping the funds of the city, is not in the legal possession of the city, the treasurer being an independent accounting officer and not a mere agent or servant.3

The application of borrowed money to the payment of the principal's debts or business expenses constitutes a benefit to him as clearly as a payment into his hands.4

It appears to be thought, on the other hand, that if money so borrowed is neither turned over to the principal nor expended in his interest, the required element of a receipt is wanting and restitution must be denied:

Billings v. Inhabitants of Monmouth, 1881, 72 Me. 174: Assumpsit on a note with count for money had and received. The plaintiff loaned money to a town, through its treasurer, taking negotiable notes which the treasurer had no authority to issue. Barrows, J. (p. 179): "It is the payment of the lawful debts of the town by its own agents with the plaintiff's money which constitutes the cause of action."

First Baptist Church v. Caughey, 1877, 85 Pa. St. 271: Assumpsit on a note with indebitatus counts. The plaintiff loaned money to a church, through its trustees, taking negotiable paper which the trustees were not empowered to issue. Gal-braith, P.J. (of the trial court, the judgment being affirmed above), (p. 272): "If the jury believe from the evidence that the money for which the note was executed by the trustees was used by them, or by other officers of the church, in rebuilding the church building, and so went to the benefit of the society, then the law raises an implied obligation in equity and good conscience, as well as in law, on the part of the church to repay it, and the verdict should be for the plaintiff. If, on the contrary, the jury believe from the evidence that the money went to pay a debt of W. J. F. Liddell, one of the trustees who signed the note, . . . plaintiff could not recover."

1 Evans v. Garlock, 1885, 37 Hun (N. Y. Sup. Ct.) 588.

2 Reid v. Rigby, [1894] 2 Q. B. 40; Leonard v. Burlington Mutual Loan Assn., 1881, 55 la. 594; 8N.W. 463. But see Fay v. Slaughter, 1901, 194 111. 157; 62 N. E. 592; 56 L. R. A. 564; 88 Am. St. Rep. 148. In Reid v. Rigby, supra, it was held the plaintiff's right to recover money borrowed without authority and paid into the defendant's account is not affected by the fact that the money was borrowed by the agent to replace money which he had wrongfully abstracted.

3 Railroad Nat. Bank v. City of Lowell, 1872, 109 Mass. 214.

4 Reid v. Rigby, [1894] 2 Q. B. 40; First Nat. Bank v. Oberne, 1886, 121 111. 25; 7 N. E. 85; Bicknell v. Widner School Township, 1881, 73 Ind. 501; First Nat. Bank v. Union School Township, 1881, 75 Ind. 361; Leonard v. Burlington Mutual Loan Assn., 1881, 55 la. 594; 8 N. W. 463; Billings v. Inhabitants of Monmouth, 1881, 72 Me. 174 ; First Baptist Church v. Caughey, 1877, 85 Pa. St. 271.

In case the agent receiving the money has no authority to borrow, the conclusion that a payment over to the principal or an application in his interest must be shown in order to establish the receipt of a benefit by such principal, is undoubtedly sound.1 But if an agent is authorized to borrow money for his principal and the promise to repay is void merely because it is in a form in which he is not authorized to make it - as, where the agent has no authority to issue negotiable paper - it would seem that the receipt of the money by the agent is the equivalent of, or in contemplation of law amounts to, a receipt by the principal, that a benefit to the principal thereupon accrues, and that the subsequent disposition of the money by the agent is immaterial.2

1 Thompson v. Murphy, 1906, 60 W. Va. 42 ; 53 S. E. 908; 6 L. R. A. (N. S.) 311. The same is true of money paid on a contract, which the agent is not authorized to receive. See McKiernan v. Valleau, 1902, 23 R. I. 501; 51 Atl. 102.

2 Keener, "Quasi-Contracts," p. 332 (commenting on First Baptist Church v. Caughey): "Since there was no excess of authority on the part of the trustees in borrowing money, there seems to be no reason why the loss in the event of a misappropriation should be thrown upon the plaintiff, simply because the trustees, when they borrowed the money, attempted to give the plaintiff a form of obligation which they had not the power to issue. Had the trustees, in the exercise of their authority, simply borrowed the money, and orally bound the corporation to pay the same, it would not be contended that the plaintiff should look to the application of the money; why then should he be required to look to its application simply because he has failed to receive the obligation which he expected ? "