Sec. 61. Agent Must Not Be Personally Interested

"It is established by the authority of elementary writers and by a long course of decisions that a person employed as an agent in any respect cannot be held to act for his own benefit, and must account to his principal for any profit he may have made in the transaction." 5

4 Healey v. Martin, 33 Misc. 236 (N. Y. 1900). 5 Carruthers v. Diefendorf, 66 App. Div. 33 (N. Y. 1901).

In Fellows v. Northup, 39 N. Y. 122 (1868), the court said: "The rule is well settled also that an agent can have no personal interest in the subject-matter of the agency, and cannot act when he is so concerned. The law of agency proceeds upon the idea that the agent is devoted to the interests of his principal, and that his judgment, his feelings and his interests all concur in the discharge of his duty. An agent employed to sell cannot buy. An agent employed to buy cannot himself be the seller, nor can a trustee be interested in the subject of the trust." 6

Sec. 62. Agent May Not Also Act As Principal

In Clark v. Bird, 66 App. Div. 284 (N. Y. 1901), the court quotes from Story on Agency to the effect that "an agent employed to sell, cannot himself become the purchaser; and an agent employed to buy, cannot himself be the seller. So an agent, employed to purchase, cannot purchase for himself." 7

In Wheeler v. Bell, 88 Hun 100 (N. Y. 1895), the then General Term of the Supreme Court in New York refused to interfere with a verdict against real estate brokers who secured an option for a certain price and then turned the property over to their principal at an increased price. An agent to sell cannot himself become the purchaser, and one who undertakes to act for another in any matter cannot in the same matter act for himself.8

"Where one undertakes to act as agent for another in the sale of property the rule is inflexible that he violates his trust by becoming the purchaser from his principal, unless the assent of the latter is established by most convincing proof. This principle is based upon good morals and good sense. As was said by Judge Story in his work on Agency (Sec. 210): 'It may be correctly said, with reference to Christian morals, that no man can faithfully serve two masters whose interests are in conflict. If, then, the seller were permitted, as the agent of another, to become the purchaser, his duty to his principal and his own interest would stand in direct opposition to each other; and thus a temptation, perhaps in many cases too strong for resistance by men of flexible morals or hackneyed in the common devices of worldly business, would be held out which would betray them into gross misconduct, and even into crime. It is to interpose a preventive check against such temptations and seductions that a positive prohibition has been found to be the soundest policy, encouraged by the purest precepts of+ Christianity.' " 9

6 Gardner v. Ogden, 22 N. Y. 327 (1860), reviews many of the authorities. See also Vol. 2, Abb. N. Y. Cy. Dig., 632.

7 Citing Dutton v. Winner, 52 N. Y. 312; Conkey v. Bond, 36 N. Y. 427; Ten Eyck v. Craig, 62 N. Y. 406, 419. See also Finch v. Conrade, 154 Pa. St. 326 (1893) ; Cornwell v. Foord, 96 111. App. 366 (1901); Albertson v. Fellows, 45 N. J. Eq. 310; Amlck v. Butler, 111 Ind. 518.

8 Bain v. Brown, 56 N. Y. 285 (1874).