Since the principal is liable to third persons on all contracts made by his agent, the principal is entitled to recover from the third person, anything owing or due from the third person, on the contract, under the usual contract obligations resulting. The primary right resulting to the principal, is the right to sue on the contract, made by his agent.1 This right is supplemented with the right to pursue and recover property, wrongfully taken by a third person, or money or property parted with, through the mistaken act of the agent.2

Whatever act of the agent binds the principal, will likewise bind the third party to the principal, since if the contract is binding on one of the parties it must also be binding on the other, otherwise it would lack the necessary element of mutuality. Where a principal ratines a contract made by an agent who acted in the first instance without authority, the principal making himself liable under the contract, makes himself thereby the only party in interest and this then gives him the exclusive primary right upon the contract.

Where the agent acts for an undisclosed principal, the third party may elect to hold the agent and not the principal,3 but if he elects to hold the principal, then he must treat the principal as the only party in interest. Where an agent acting without authority disposes of property of the principal to a third person, the principal may recover his property wherever he finds it.4 The rule does not apply in the case of money or negotiable paper. Anyone who transfers money can give good title, and since by the law merchant negotiable paper is given the same attributes as money, one who takes negotiable paper as a bona fide purchaser, gets a good title no matter what the existing equities may have been between the original parties to the paper, but if the purchaser does not take in a bona fide way the principal may recover his property from the third person.

1 Demarest vs. Barbadoes, 40 N. J. L., 604; Loomis vs. Barker, 69 I11., 360.

2Taylor vs. Prendergast, 3 Hill,

N. Y., 72. 3 Norris vs. Taylor, 49 I11., 17.