Scope of Agent's Authority; Effect of Private Instructions; Dealing With Special Agent

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The agent's authority shall be construed to include all necessary and usual means for effectually executing it. Private instructions or limitations not known to persons dealing with a general agent shall not affect them. In special agencies for a particular purpose, persons dealing with the agent should examine his authority.

(Orig. Code 1863, § 2174; Code 1868, § 2170; Code 1873, § 2196; Code 1882, § 2196; Civil Code 1895, § 3023; Civil Code 1910, § 3595; Code 1933, § 4-301.)

Law reviews.

- For article surveying the law in Georgia on admissions, see 8 Mercer L. Rev. 252 (1957).

JUDICIAL DECISIONS

ANALYSIS

  • General Consideration
  • Scope of Authority
  • Instructions or Limitations on Authority
General Consideration

"General agency" exists if there is a delegation of authority to do all acts in connection with a particular trade or business. Bacon v. Dannenberg Co., 24 Ga. App. 540, 101 S.E. 699 (1919); Carmichael v. Silvers, 90 Ga. App. 804, 84 S.E.2d 668 (1954).

"General agent" may either be one clothed with power to do all the principal's business, of every character, or the general agent may be one empowered to do all acts connected with a particular business or employment. First Nat'l Bank v. Charles Nelson & Co., 38 Ga. 391, 95 Am. Dec. 400 (1868).

"General agent" is defined to be one who is employed to transact generally all the business of the principal in regard to which the agent is employed, or in other words to do all acts connected with a particular trade, business, or employment, or to transact all the business of the principal of a particular kind or in a particular place. Raines v. Graham, 85 Ga. App. 815, 70 S.E.2d 125 (1952).

"General agent" is one who is authorized to do all acts connected with a particular trade, business, or employment. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

"Special agent" is one appointed to do a single act or several specified acts. First Nat'l Bank v. Charles Nelson & Co., 38 Ga. 391, 95 Am. Dec. 400 (1868).

"Special agent" is authorized to do one or more specific acts in pursuance of particular instructions or within restrictions necessarily implied from the act to be done. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

"Special agent" is one to whom there is a delegation to do a single act. Lewis v. Citizens & S. Nat'l Bank, 139 Ga. App. 855, 229 S.E.2d 765 (1976).

Attorney as "special agent."

- Attorney is not a general agent for all purposes, but the attorney's authority is limited to the particular purpose for which the attorney was retained and the attorney's authority to do other things must be inquired into; as a special agent, the attorney has no inherent power to dispose of the client's property or legal right, but must obtain special authority. Addley v. Beizer, 205 Ga. App. 714, 423 S.E.2d 398, cert. denied, 205 Ga. App. 899, 423 S.E.2d 398 (1992).

Third person may presume general agency continues until notice of revocation.

- Whenever a general agency has been established for any purpose, all persons who have dealt with the agent have a right to assume that the agent's authority to deal with the third person in behalf of the agent's principal continues, until notice, express or implied, has been conveyed to the third person that the agency has been revoked. Bacon v. Dannenberg Co., 24 Ga. App. 540, 101 S.E. 699 (1919); Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

When acts of dual agent are avoidable.

- If an agent attempts to act for two parties, the effect of the agent's acts may be avoided by the principal when such dual agency is without the principal's full knowledge and consent. Abercrombie v. Ford Motor Co., 81 Ga. App. 690, 59 S.E.2d 664, rev'd on other grounds, 207 Ga. 464, 62 S.E.2d 209 (1950).

Agency cannot be proved by evidence of mere declarations of the alleged agent. Wofford Oil Co. v. Story, 52 Ga. App. 496, 183 S.E. 840 (1936).

Agent's declarations are admissible with other evidence.

- When accompanied by other evidence as to the conduct of the person in the character of agent and acceptance by the alleged principal of the fruits of the agency, such declarations are admissible in evidence. Wofford Oil Co. v. Story, 52 Ga. App. 496, 183 S.E. 840 (1936).

Third person must prove authority for acts beyond those reasonably necessary.

- Person dealing with a special agent takes the risk as to any extension of the agent's authority beyond that which is authorized, and the burden rests upon the special agent to show authority from the principal for any acts of the agent other than such usual and ordinary acts as are reasonably necessary to a due performance of the particular purpose of the agency. Wise v. Mohawk Rubber Co., 23 Ga. App. 255, 98 S.E. 100 (1919).

Authority to release must be proved.

- Person relying on a release of the person's contract by an agent must prove authority in the agent to make the release. International Correspondence Sch. v. Wright, 47 Ga. App. 861, 171 S.E. 831 (1933).

Fact employees were acting within scope of employment must be proved.

- Fact that one or more employees were acting within the scope of their employment was a fact to be proved on the trial by competent evidence, if the same was not admitted by the defendants in their answer, and could be proved either by showing specific authority or it might be inferred from all of the facts and circumstances of the case. Duchess Chenilles, Inc. v. Masters, 84 Ga. App. 822, 67 S.E.2d 600 (1951).

Admission of agency in answer binds defendant.

- If the plaintiff alleged that a certain individual was the agent of defendant company, and the answer admitted the agency, and no amendment was made striking that part of the answer, and the trial proceeded on the only issue left, to wit, whether the defendant had complied with the defendant's contract, this admission was binding on the defendant, notwithstanding testimony admitted without objection that the individual bought an option on the property and transferred the option to the defendant. Wofford Oil Co. v. Story, 52 Ga. App. 496, 183 S.E. 840 (1936).

Existence and extent of authority are questions of fact.

- Questions of the existence and extent of an agent's authority are generally for the triers of fact. Allen & Bean, Inc. v. American Bankers Ins. Co., 153 Ga. App. 617, 266 S.E.2d 295 (1980).

Apparent authority.

- Question of the scope and extent of an agency's apparent authority is to be decided from all the facts and circumstances in evidence. All questions of law must be decided by the court, and all questions of fact must be decided by the jury. Warnock v. Elliott, 96 Ga. App. 778, 101 S.E.2d 591 (1957).

Extent of written authority is for court.

- If an agent's authority is conferred and defined in writing, the scope or extent of such authority must be determined from the terms of the writing and is to be determined and construed by the court. Findlay Brick Co. v. American Sewer Pipe Co., 18 Ga. App. 446, 89 S.E. 535 (1916).

Cited in Johnson v. Milam, 38 Ga. App. 568, 144 S.E. 346 (1928); Miles v. Foy, 38 Ga. App. 473, 144 S.E. 802 (1928); Armour Fertilizer Works v. Maddox, 168 Ga. 429, 148 S.E. 152 (1929); White v. Dotson, 41 Ga. App. 436, 153 S.E. 233 (1930); Lancaster v. Neal, 41 Ga. App. 721, 154 S.E. 386 (1930); Central of Ga. Ry. v. Dabney, 44 Ga. App. 143, 160 S.E. 818 (1931); Nowell v. Mayor of Monroe, 177 Ga. 648, 171 S.E. 136 (1933); Gibbs v. Carolina Portland Cement Co., 50 Ga. App. 229, 177 S.E. 760 (1934); Newton v. Gulf Life Ins. Co., 55 Ga. App. 330, 190 S.E. 69 (1937); Weathers Bros. Transf. Co. v. Jarrell, 72 Ga. App. 317, 33 S.E.2d 805 (1945); Long Tobacco Harvesting Co. v. Brannen, 99 Ga. App. 541, 109 S.E.2d 90 (1959); Bulloch County v. Ritzert, 99 Ga. App. 655, 109 S.E.2d 618 (1959); Crown Carpet Mills, Inc. v. C.E. Goodroe Co., 108 Ga. App. 327, 132 S.E.2d 824 (1963); Zanac, Inc. v. Frazier Neon Signs, Inc., 134 Ga. App. 501, 215 S.E.2d 265 (1975); Georgia-Pacific Corp. v. Corbin, 137 Ga. App. 37, 222 S.E.2d 862 (1975); National Carloading Corp. v. Security Van Lines, 164 Ga. App. 850, 297 S.E.2d 740 (1982); Glennville Hatchery, Inc. v. Thompson, 164 Ga. App. 819, 298 S.E.2d 512 (1982); Holcomb v. Evans, 176 Ga. App. 654, 337 S.E.2d 435 (1985); Transus, Inc. v. Crosby, 196 Ga. App. 880, 397 S.E.2d 135 (1990); Transouthern Freight Sys. v. Astley, 201 Ga. App. 521, 411 S.E.2d 501 (1991).

Scope of Authority

1. Generally

Test of extent of authority.

- Extent of an agent's authority is not determined by the title affixed to the agent's name, but, as between the agent's principal and third persons, the test is in the authority which the agent actually has or which the agent's principal expressly or impliedly represents the agent as having. Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

One may be called a special agent and yet be given the broadest powers. Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

Authority includes all necessary and usual means.

- This section embodies a sound proposition taken from the common law, that is, that the agent's authority will be construed to include all necessary and usual means for effectuating authority. Strong v. West, 110 Ga. 382, 35 S.E. 693 (1900).

First sentence applies to both general and special agents. Callaway v. Barmore, 32 Ga. App. 665, 124 S.E. 382 (1924); Star Furn. Co. v. Dubberly, 46 Ga. App. 178, 167 S.E. 207 (1932).

Authority of special and general agents.

- Provision of this section that "the agent's authority shall be construed to include all necessary and usual means for effectually executing it" has reference to both special and general agents. Prudential Ins. Co. of Am. v. Franklin, 51 Ga. App. 496, 180 S.E. 869 (1935).

While a general agent has broader powers than one selected to do a particular act, the authority in both cases must be construed to include all necessary and usual means for effectually executing the authority. Bass Dry Goods Co. v. Granite City Mfg. Co., 119 Ga. 124, 45 S.E. 980 (1903); Hopkins & Co. v. Armour & Co., 8 Ga. App. 442, 69 S.E. 580 (1910).

Agent's authority once established shall be construed to include all necessary and usual means for effectively executing the agent's authority, and this rule applies when the agency is created for general as well as for special purposes. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

Agent may do everything essential to agent's duties.

- Agent to conduct a given business for the agent's principal necessarily has authority to do everything which is essential to the performance of the agent's duties as agent. Carmichael v. Silvers, 90 Ga. App. 804, 84 S.E.2d 668 (1954).

Agent may do everything usual or necessary.

- Express authority to do an act includes as incidental thereto authority to do those things which are usual or necessary to accomplish effectually the act expressly authorized. McDonald v. Pearre Bros. & Co., 5 Ga. App. 130, 62 S.E. 830 (1908).

Authority for an agent to do a thing generally includes authority to do everything usual and necessary for the accomplishment of the main objective. Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

Agent may use all usual means, unless contrary clearly appears.

- If an agency is created for the performance of an act beneficial to the principal, all the usual modes and means of accomplishing the objects of the agency are included in the agency's creation, unless the contrary clearly appears. Strong v. West, 110 Ga. 382, 35 S.E. 693 (1900); John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overruled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Fact that at the time of an accident a truck driver was on the driver's way to the lumberyard to get lumber with which to fasten furniture more securely on the truck does not mean that the driver was deviating from the mission to haul furniture for the employer since if the driver was moving the furniture under the authority of the master in the first instance, the driver's authority would include all necessary and usual means for effectually accomplishing the task. Ellison v. Evans, 85 Ga. App. 292, 69 S.E.2d 94 (1952).

Rule applies to power of attorney.

- General rule that an agent's authority shall be construed to include all necessary and usual means for executing the authority has application to the provisions of a power of attorney. Johnson v. Johnson, 184 Ga. 783, 193 S.E. 345 (1937).

Authority does not extend beyond what is necessary or incidental to it.

- Agent's authority does not extend beyond what is necessary or incidental to the authority given. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

Agent may only do what agent may reasonably infer principal desires.

- Agent is authorized to do, and to do only, what it is reasonable for the agent to infer that the principal desires the agent to do in the light of the principal's manifestations and the facts as the agent knows or should know them at the time the agent acts. Union Camp Corp. v. Dyal, 460 F.2d 678 (5th Cir.), cert. denied, 409 U.S. 849, 93 S. Ct. 56, 34 L. Ed. 2d 90 (1972).

When authority to sell inferred.

- Authority to sell the principal's property is inferred only when it is incidental to the transaction, usually accompanies the authority expressly conferred, or is reasonably necessary in accomplishing it. Union Camp Corp. v. Dyal, 460 F.2d 678 (5th Cir.), cert. denied, 409 U.S. 849, 93 S. Ct. 56, 34 L. Ed. 2d 90 (1972).

Authority to obtain execution of prepared contract does not include authority for other agreement.

- Authority to a special agent to obtain the signature of a seller to a prepared written contract for the sale of a certain amount of cotton, without more, does not include within itself authority to make a parol agreement that the cotton shall not in fact be delivered, but that the parties shall settle on the basis of the difference between the agreed price and the market price at the time for delivery. Terry v. International Cotton Co., 138 Ga. 656, 75 S.E. 1044 (1912).

Power to purchase includes power to execute note.

- Agent having authority to purchase fertilizer for a company, it will be presumed by virtue of this section that the agent had authority to execute in behalf of the company a note for the payment of the purchase price. Swift & Co. v. Dawson Paper Shell Pecan Co., 24 Ga. App. 625, 101 S.E. 754 (1919).

Power to make cash purchases does not include power to pledge credit.

- Person having authority from another to use the other's name in making cash purchases for the latter has no authority, as the latter's agent, to make purchases and pledge the principal's credit for their payment. Morgan v. Georgia Paving & Constr. Co., 40 Ga. App. 335, 149 S.E. 426 (1929).

Authority to sign note does not warrant signing note for larger amount.

- Under this section, if one person authorized another to sign one's name to a note for a certain amount and the latter, instead of so doing, signed a note for a larger amount, it is not an abuse of power by the agent but an act by the agent wholly unwarranted. King v. Sparks, 77 Ga. 285, 1 S.E. 266, 4 Am. St. R. 85 (1886).

Factor not authorized to pledge or mortgage.

- Factor for the sale of goods is a general agent for that purpose and cannot, as against the owner, pledge or mortgage them to a third party to secure advances made on the agent's own account. First Nat'l Bank v. Charles Nelson & Co., 38 Ga. 391, 95 Am. Dec. 400 (1868).

Drawing bills of exchange.

- According to the evidence the drawing of foreign bills of exchange by the defendants, as the factors and shipping agents of the plaintiff, was the necessary and usual means to enable the defendants, as such agents, to obtain the proceeds of plaintiff's cotton in sterling bills. Jones v. J.W. Lathrop & Co., 44 Ga. 398 (1871).

Cotton factor's agent may make terms for shipments.

- Cotton factor's agent, who is authorized to solicit shipments of cotton to the agent's principal, is a general agent for that purpose, and is presumptively authorized to make terms upon which the cotton shall be shipped, received, stored, sold, and handled by the agent's principal. John Flannery Co. v. James, 13 Ga. App. 425, 79 S.E. 912 (1913).

Authority to sell includes authority to agree on price.

- If one is appointed to sell a particular article to a particular person, this confers on the special agent authority to agree on the price; otherwise, the appointment is illusory, and not real. Bass Dry Goods Co. v. Granite City Mfg. Co., 119 Ga. 124, 45 S.E. 980 (1903); Hopkins & Co. v. Armour & Co., 8 Ga. App. 442, 69 S.E. 580 (1910).

Authority to collect.

- Agency to sell does not necessarily carry with it an agency to collect. Walton Guano Co. v. McCall, 111 Ga. 114, 36 S.E. 469 (1900).

Agency to sell does not necessarily or impliedly or incidentally carry with it the authority to collect. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

Credit manager does not have authority to accept order.

- Acceptance of an order for goods by the credit manager of a corporation is not binding on the corporation when the credit manager neither has authority to make sales nor was held out by the corporation as having such authority, but the authority to sell was vested in another agent; and the deposit with a traveling sales person of a check as part payment on a proposed sale of goods, at the instance of the credit manager, which check was not accepted by the corporation but was returned to the drawee of the check, would not constitute part payment to the corporation. W. & J. Sloane Selling Agents, Inc. v. Tampa Chair & Table Co., 53 Ga. App. 609, 186 S.E. 761 (1936).

Collecting agency has authority to employ attorney to sue.

- If one holding a promissory note against another with a claim on certain property as security sends the note and papers evidencing the claims to a collecting agency, a power is created in the latter to procure the services of an attorney, if necessary, to collect the note and enforce the security. Strong v. West, 110 Ga. 382, 35 S.E. 693 (1900).

A collecting agency empowered by a patron to collect a claim is authorized to employ an attorney to institute suit on the claim in behalf of the client; the patron becomes the attorney's client, and for the attorney's conduct the patron is as much responsible as if the patron had employed the attorney in the first instance instead of engaging the services of the collecting agency. Chamberlin Co. of Am. v. Mays, 96 Ga. App. 755, 101 S.E.2d 728 (1958).

If an Atlanta collecting agency was employed by the defendant to collect a debt, through the medium of a Detroit collecting agency empowered under the terms of a contract with the defendant to sue the claim, to engage the services of the Atlanta agency, and to transmit to the latter the authority conferred upon it, the Atlanta agency was vested with authority to retain a lawyer to handle the litigation necessary to collect the debt because the agency could not institute a suit on behalf of the defendant. Chamberlin Co. of Am. v. Mays, 96 Ga. App. 755, 101 S.E.2d 728 (1958).

Authority to collect does not authorize receiving anything except cash.

- As a general rule, a special agent or attorney to collect a debt is not authorized to receive anything as a payment thereon except actual cash. Walton Guano Co. v. McCall, 111 Ga. 114, 36 S.E. 469 (1900); Quillan & Bros. v. Wales Adding Mach. Co., 34 Ga. App. 135, 128 S.E. 698 (1925).

Authority to accept less than full amount.

- Presumptively, an agent is hired to make contracts and not to cancel contracts, and a power to collect money under a contract will not raise a presumption of authority in the agent to vary the terms and accept less than the agreed price. International Correspondence Sch. v. Wright, 47 Ga. App. 861, 171 S.E. 831 (1933).

If there is no apparent limitation on an attorney's authority, an attorney at law who has had placed with the attorney an account for collection cannot accept from the debtor, in full accord and satisfaction, anything less than the full amount of the claim, and that in cash; nevertheless, authority to effectuate the collection gives to the attorney implied authority to do everything usual and immediately necessary to accomplish the main purpose of the agency, that of making the collection "in cash." John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overruled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Authority to endorse check received for full amount.

- Attorney with whom has been placed an account for collection, with no limitation on the attorney's authority as to the manner of collection, on receipt from the debtor of a check in the full amount of the claim and payable to the order of the client, has, without any enabling or permissive authority from the client, authority to endorse the name of the client personally as attorney, in order effectually to liquidate the collection; nor is the rule modified should the attorney, in lieu of taking manual possession of the money, deposit the check either to the attorney's individual account or to the attorney's account as attorney. John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overruled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Action of attorneys with whom a claim was placed for collection in endorsing client's name on check in settlement thereof, by themselves as attorneys, and depositing the check to the attorney's credit, did not constitute the crime of forgery, as the attorneys had authority to so endorse the check; hence, the bank was within the bank's right and authority when the bank cashed or paid the check by deposit to the credit of the attorneys making the collection, and would not, under the facts, be liable to the client of the attorneys, to whom the attorneys may have defaulted in remittance of the proceeds arising from the collection. John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overruled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Authority to endorse check received if attorney has interest in collection.

- Attorney having an interest in a collection in the nature of a commission for services in effectuating the collection has authority to endorse the name of the attorney's client to whom the check is made payable, individually as attorney, in order that the attorney may deduct the commission fees before remittance of the collection to the client. John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overuled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Authority to foreclose security deed includes authority to execute required quitclaim reconveyance.

- If the holder of the legal title under a deed to secure debt executed a power of attorney empowering the holder's named attorney in fact to bring suit on papers comprising the deed and evidence of debt, to cause the property to be sold under levy after judgment, and to bid in the property in the name of such holder of the legal title, this authority included, as a "necessary and usual means" of selling the property, the right to execute the quitclaim reconveyance to the debtor, record of which in the clerk's office is made under former Code 1933, §§ 39-202 and 67-1501, a prerequisite to a valid levy and sale of the property. Johnson v. Johnson, 184 Ga. 783, 193 S.E. 345 (1937).

Power to take bond does not include power to agree to conditions.

- Ordinary (now judge of the probate court) who was appointed by the Governor to take a bond had no authority to consent to any stipulations or conditions, and any such consent would be in excess of the power conferred upon the ordinary. Lewis v. Board of Comm'rs, 70 Ga. 486 (1883).

Authority to make minor repairs necessarily includes the authority to employ others to do the work. Oconee County v. Rowland, 107 Ga. App. 108, 129 S.E.2d 373 (1962).

Delivery person may obtain assistance of another in changing tire.

- If a servant is employed to take and deliver goods of the master in its truck to customers in another city, and after their delivery to return the truck to the master's place of business, and while the servant is thus en route, a blowout of a heavy tire occurs, the servant, in the absence of contrary instructions, is authorized, so far as reasonably necessary, to obtain the assistance of another in the furnishing of needful light for the work of changing the tire, when the blowout occurs at night. McGhee v. Kingman & Everett, Inc., 49 Ga. App. 767, 176 S.E. 55 (1934).

Foreperson of construction gang has no authority to hire teams.

- Foreperson of a construction gang is a special agent with limited powers and has no authority to hire teams for a definite term. Langston v. Postal Telegraph-Cable Co., 6 Ga. App. 833, 65 S.E. 1094 (1909).

Conditions which enter into validity of contract of insurance at its inception may be waived by the agent, and are waived if so intended, although they remain in the policy when delivered, and limitations therein upon the authority of the agent to waive such conditions otherwise than in writing attached to or endorsed upon the policy are treated as referring to waivers made subsequently to the issuance of the policy. National Fire Ins. Co. v. Thompson, 51 Ga. App. 625, 181 S.E. 101 (1935).

Agent is without authority to continue cancelled policy.

- If authority of agent is limited by terms of group insurance policy and such policy is cancelled, such agent is without authority to continue such cancelled policy in force, unless such continuation is accepted and agreed to by the officers of the company empowered so to do, or there has been an acceptance by the company of payments of premiums made for such purpose, and such agent is without authority to constitute the employer in group insurance policy the agent of the company to receive premiums for it. Lancaster v. Travelers Ins. Co., 54 Ga. App. 718, 189 S.E. 79 (1936).

2. Apparent Authority

Principal bound by agent's apparent authority.

- Principal is bound when the agent lacks express authority but is possessed of apparent authority. Home Materials, Inc. v. Auto Owners Ins. Co., 250 Ga. 599, 300 S.E.2d 139 (1983).

"Apparent authority" defined.

- "Apparent authority" is power which results from acts that appear to third persons to be authorized by the principal. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

"Apparent authority" is the power to affect the legal relations of another person by transactions with third persons, professedly as agent for the other, arising from and in accordance with the other's manifestations to such third persons. Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

Basis of apparent authority doctrine.

- Doctrine of apparent authority is based upon the principle that when one of two innocent parties must suffer from the wrongful act of another, the loss should fall upon the one who, by that person's conduct created the circumstances which enabled the third party to perpetuate the wrong and cause the loss. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

Principal's conduct may establish agent's authority.

- Authority of an agent in a particular instance may be established by the principal's conduct and course of dealing. Home Materials, Inc. v. Auto Owners Ins. Co., 250 Ga. 599, 300 S.E.2d 139 (1983).

Agent is presumed to have authority within apparent scope.

- If a person imposes upon another the duties and responsibilities involving the management and control of a matter of business, the agent will be presumed to have authority to represent the agent's employer in any matter within the scope of the agent's apparent authority. Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

Principal is bound to the extent of the apparent authority the principal has conferred upon the agent, and not by the actual or express authority, when that differs from the apparent authority. Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

In the case of a general agency, the principal is bound by the acts of an agent within the apparent scope of the agent's authority. Bacon v. Dannenberg Co., 24 Ga. App. 540, 101 S.E. 699 (1919); Carmichael v. Silvers, 90 Ga. App. 804, 84 S.E.2d 668 (1954).

General agent may bind the agent's principal with respect to all matters within the apparent scope of the agent's authority. Hutson v. Prudential Ins. Co., 122 Ga. 847, 50 S.E. 1000 (1905).

Special agent.

- If one holds another out as one's special agent, the principal is bound by the agent's apparent authority to do the particular thing thus authorized, as well as to do any and all things usual and necessary and to employ all usual and necessary means as may be reasonably required, in the due, proper, and ordinary performance of the particular purpose of the appointment. Wise v. Mohawk Rubber Co., 23 Ga. App. 255, 98 S.E. 100 (1919); Callaway v. Barmore, 32 Ga. 665, 124 S.E. 382 (1924); Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

If principal's words or conduct cause third person to believe principal consents.

- Apparent authority to do an act is created as to a third person by written or spoken words or any other conduct of the principal which, reasonably interpreted, causes the third person to believe that the principal consents to have the act done on the principal's behalf by the person purporting to act for the principal. Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

Estoppel against principal to deny authority.

- Under the doctrine of apparent authority, an estoppel is worked against the principal to deny that there was authority, and the principal will not be permitted to prove that the agent's authority was, in fact, less extensive than that with which the agent was apparently clothed. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

Establishing authority of agent.

- Authority of an agent in a particular instance may be established by the habits, conduct, and course of business of the principal. If one thus holds out to another that one's agent possesses certain authority and this induces or influences others in their dealings with the agent, the principal is estopped to deny that the agent has the authority which, as reasonably deducible from the conduct of the principal, the agent apparently possesses. Germain Co. v. Bank of Camden County, 14 Ga. App. 88, 80 S.E. 302 (1913); Bacon v. Dannenberg Co., 24 Ga. App. 540, 101 S.E. 699 (1919); Atlanta Biltmore Hotel Corp. v. Martell, 118 Ga. App. 172, 162 S.E.2d 815 (1968); Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975); Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

Justified reliance required for estoppel.

- In order for estoppel under the doctrine of apparent authority to occur it must appear that the third party dealt with the agent in reliance upon the authority which the principal has apparently conferred upon the agent, and it must appear that a person of ordinary prudence conversant with business usages and the nature of the particular business is justified in assuming that such agent had authority to perform a particular act and deals with the agent upon that assumption. Interstate Fin. Corp. v. Appel, 134 Ga. App. 407, 215 S.E.2d 19 (1975).

When an alleged principal, by acts or conduct, has knowingly caused or permitted another to appear as the principal's agent, the principal will be estopped to deny the agency, to the injury of third persons who have in good faith and in reasonable prudence dealt with the apparent agent on the faith of the relation. Allen & Bean, Inc. v. American Bankers Ins. Co., 153 Ga. App. 617, 266 S.E.2d 295 (1980).

An estoppel is worked against the principal to deny authority if it appears that the third party dealt with the agent in reliance upon the authority apparently conferred upon it by the principal. Home Materials, Inc. v. Auto Owners Ins. Co., 250 Ga. 599, 300 S.E.2d 139 (1983).

Authority of an agent in a particular instance need not be proved by express contract. Germain Co. v. Bank of Camden County, 14 Ga. App. 88, 80 S.E. 302 (1913); Atlanta Biltmore Hotel Corp. v. Martell, 118 Ga. App. 172, 162 S.E.2d 815 (1968); Arrington & Blount Ford, Inc. v. Jinks, 154 Ga. App. 785, 270 S.E.2d 27 (1980).

Authority to sell does not include apparent authority to release debtor.

- Agent or representative whose duties are merely to sell goods for a principal and collect therefor has no apparent authority under this section to release anyone from an obligation due to the principal. Morgan v. Weil Co., 31 Ga. App. 611, 121 S.E. 703 (1924).

Authority to collect and adjust apparently includes authority to release.

- If an agent with authority from a principal to "adjust" and "collect" accounts is sent by the principal to collect an alleged indebtedness due the principal under a particular contract, which contract contemplates that the debtor might under some circumstances turn back to the creditor goods purchased from the creditor under the contract, one is a general agent for the purpose of adjusting and collecting the indebtedness, and it is apparently within the scope of one's authority to accept from purchasers of the debtor goods of the character bought by the debtor under the contract from the creditor, the agent's principal, and also to release the debtor from further liability under the contract, and also to accept payment in release of all liability under the contract of guaranty from the guarantor; and, although the agent may not have actually possessed such authority, a settlement by way of release, so made with one of the guarantors, without knowledge of such limitation, is binding upon the agent's principal. Rawleigh Co. v. Royal, 30 Ga. App. 706, 119 S.E. 339 (1923).

Authority to endorse check includes apparent authority to deposit proceeds.

- If an attorney has authority to endorse a check payable to the attorney's client, the attorney has apparent authority to deposit the proceeds thereof either in the attorney's individual account or the attorney's account as attorney. John Bean Mfg. Co. v. Citizens Bank, 60 Ga. App. 615, 4 S.E.2d 924 (1939), overruled on other grounds, Tifton Bank & Trust Co. v. Knight's Furn. Co., 215 Ga. App. 471, 452 S.E.2d 219 (1994).

Traveling salesperson apparently has authority to transmit instructions as to insuring goods.

- Since it is a custom of wholesalers to effect insurance on goods shipped by the wholesalers, when requested or instructed so to do by their customers, an ordinary drummer or commercial traveler, who by the terms of employment is authorized to receive and transmit orders but not to close contracts, has apparent authority to receive and transmit instructions as to effecting insurance on goods ordered through the drummer or commercial traveler. McDonald v. Pearre Bros. & Co., 5 Ga. App. 130, 62 S.E. 830 (1908).

Real estate sales person apparently has authority to guarantee purchaser's lease will be cancelled.

- Person employed by a real estate broker to act for the person as a "real estate salesman," whose duties are to obtain listings of real estate for sale, "to make sales of real estate just in a general way," and who has "the privilege of making transactions generally," is a general agent for the broker to procure purchasers for real estate listed with the broker for sale; and it is within the scope of the apparent authority of the sales person as the agent of the broker, in negotiating sales of real estate, to bind the principal by an obligation to the purchaser made for the purpose of inducing the purchaser to buy the real estate, and as a part of the consideration moving to the contract for the purchase of the real estate, to guarantee to obtain for the purchaser a cancellation of a lease which the purchaser has as a tenant of the premises other than that which are the subject matter of the sale. J.J. Williamson & Sons v. Smith, 47 Ga. App. 495, 170 S.E. 709 (1933).

Although it was undisputed that the patient did not sign the arbitration agreement personally, the operator asserted that the patient's spouse was the patient's agent and, therefore, had the authority to bind the patient to the agreement by signing the spouse's name; in Georgia, an agency relationship was created whenever one person, expressly or by implication, authorized another to act for the person or subsequently ratified the acts of another in the person's behalf, O.C.G.A. § 10-6-1, and because the operator had not proven, by a preponderance of the evidence, that the patient expressly authorized the operator to act on the patient's behalf in signing the arbitration agreement, an agency relationship was created, if at all, by implication. Under Georgia law, the agent's authority shall be construed to include all necessary and usual means for effectually executing it. O.C.G.A. § 10-6-50, and even assuming that the version of events put forth by the operator's witnesses was true, the operator failed to meet the operator's burden of proving that the patient's spouse had actual or apparent authority to bind the patient by signing the arbitration agreement; accordingly, the arbitration agreement was not enforceable against the patient pursuant to 9 U.S.C. § 4, and the operator's motion to compel arbitration and stay discovery was denied. Gentry v. Beverly Enterprises-Georgia Inc., 714 F. Supp. 2d 1225 (S.D. Ga. 2009).

Instructions or Limitations on Authority

1. Generally

Authority of attorney of record is fixed by contract and client's instructions.

- Attorney of record is a party's agent in the prosecution of a legal action, and the attorney's authority is determined by the terms of the attorney's contract of employment and the instructions given by the client. Davis v. Davis, 245 Ga. 233, 264 S.E.2d 177 (1980).

Special agent, like broker, derives power from instructions.

- Under former Code 1873, §§ 2184 and 2196, a broker was a special agent and derived the broker's power and authority to bind the principal from the instruction given to the broker by the principal. Clark & Nunnally v. Cumming & Co., 77 Ga. 64, 4 Am. St. R. 72 (1886).

Special agent cannot bind principal beyond known limitations.

- One who deals with a special agent, knowing at the time the limits within which the agent, under the terms of the agent's appointment, has authority to bind the agent's principal, is bound to act with reference to this knowledge, and cannot hold the principal liable for loss occasioned by acts of the agent in excess of, or contrary to, the latter's authority in the premises. Littleton & Lamar v. Loan, Mercantile & Stock Ass'n, 97 Ga. 172, 25 S.E. 826 (1895), later appeal, 100 Ga. 85, 26 S.E. 83 (1896); Quillan & Bros. v. Wales Adding Mach. Co., 34 Ga. App. 135, 128 S.E. 698 (1925).

In special agencies, the rule is that if the agent exceeds the special and limited authority conferred upon the agent, the principal is not bound by the agent's acts, but they are mere nullities, so far as the principal is concerned, unless the principal has held the agent out as possessing a more enlarged authority. Comer v. Foley, 98 Ga. 678, 25 S.E. 671 (1896); W. & J. Sloane Selling Agents, Inc. v. Tampa Chair & Table Co., 53 Ga. App. 609, 186 S.E. 761 (1936).

Principal is never bound when third person knows authority was exceeded.

- A principal is not bound by the acts of an agent when those acts are beyond the scope of the agent's authority and the person dealing with the agent knows thereof. Boles v. Hartsfield Co., 50 Ga. App. 442, 178 S.E. 416 (1935).

If limitation on authority of agent is contained in an application for insurance, attached to and made part of the policy, and the agent was therefore not acting within the apparent scope of the agent's authority in waiving a breach of condition existing when the policy was issued, the insurer is not bound by the alleged waiver or by any estoppel. National Fire Ins. Co. v. Thompson, 51 Ga. App. 625, 181 S.E. 101 (1935).

Unknown, private instructions cannot affect third persons.

- Private instructions or limitations not known to persons dealing with an agent who assumes to act within the apparent scope of the agent's authority cannot affect the third parties. Hutson v. Prudential Ins. Co., 122 Ga. 847, 50 S.E. 1000 (1905); Hopkins & Co. v. Armour & Co., 8 Ga. App. 442, 69 S.E. 580 (1910).

Unknown private instructions in case of general agent.

- Private instructions or limitations not known to persons dealing with a general agent are not binding upon such persons. Bacon v. Dannenberg Co., 24 Ga. App. 540, 101 S.E. 699 (1919).

If it appears, without contradiction, that the agent had entire control of all the business affairs of the agent's sister, the landlord, including the management and control of the farm, the agent must be held to have been a general agent, and the agent's alleged agreement would be binding on the principal as landlord. This would be true despite any private instructions or limitations upon the agent's authority not known to the person dealing with the agent as a general agent. Nelson v. Fuqua, 46 Ga. App. 754, 169 S.E. 206 (1933).

If a clerk is left in charge of a mercantile establishment by the proprietors thereof in the proprietors' absence, with authority to conduct the business and to buy goods upon the credit of the proprietors, and with authority to conduct all the correspondence of the business, one is a general agent of the proprietors for the supervision of the establishment and the buying on their credit of goods of a mercantile character and suitable to the business conducted by the proprietors, and since one is such a general agent, limitations upon one's authority as to the amount and character of the purchases, which are unknown to persons dealing with the agent, do not affect them. Mason v. Rice, 47 Ga. App. 502, 170 S.E. 829 (1933).

Unknown private instructions in case of special agent not exceeding necessary and usual means.

- Although the second sentence of this section mentions only general agents, so long as a special agent does not go beyond the necessary and usual means for executing the special agent's agency, the special agent's powers with reference to the particular undertaking are in the nature of those of a general agent to the extent that private instructions or limitations not known to the persons dealing with the special agent cannot affect the other parties. Callaway v. Barmore, 32 Ga. App. 665, 124 S.E. 382 (1924); Fireman's Fund Ins. Co. v. Davis, 42 Ga. App. 49, 155 S.E. 105 (1930).

Secret instructions in case of special agent to sell who fixes price.

- When, without naming the terms of sale, the principal, in writing authorizes a special agent to sell personal property to a particular person, the authority of such special agent will be construed to include all necessary and usual means for effectually executing it, and such agent has authority to fix the price of the goods, and the purchaser is not bound to take notice of secret instructions given by the principal. Bass Dry Goods Co. v. Granite City Mfg. Co., 119 Ga. 124, 45 S.E. 980 (1903).

Secret instructions do not alter general rule as to authority to use usual means.

- Rule that whenever an agent is empowered to do a particular thing, the agent is also empowered to use all lawful means to accomplish the thing, would not be altered by any secret instructions given to the agent by the principal, unknown to a third person. John Flannery Co. v. James, 13 Ga. App. 425, 79 S.E. 912 (1913).

2. Inquiring as to Instructions

Third persons must inquire as to special agent's authority.

- Persons dealing with an agent appointed for a particular purpose are bound to inquire as to the extent of the agent's authority. Baldwin Fertilizer Co. v. Thompson & McAlister, 106 Ga. 480, 32 S.E. 591 (1899); Harris Loan Co. v. Elliott & Hatch Book Typewriter Co., 110 Ga. 302, 34 S.E. 1003 (1900); Carter v. Pembroke Nat'l Bank, 11 Ga. App. 479, 75 S.E. 824 (1912); Germain Co. v. Bank of Camden County, 14 Ga. App. 88, 80 S.E. 302 (1913); Quillan & Bros. v. Wales Adding Mach. Co., 34 Ga. App. 135, 128 S.E. 698 (1925); Nalley v. Whitaker, 102 Ga. App. 230, 115 S.E.2d 790 (1960); Addley v. Beizer, 205 Ga. App. 714, 423 S.E.2d 398, cert. denied, 205 Ga. App. 899, 423 S.E.2d 398 (1992); Continental Ins. Co. v. Gazaway, 216 Ga. App. 125, 453 S.E.2d 91 (1994); Turnipseed v. Jaje, 267 Ga. 320, 477 S.E.2d 101 (1996).

Even though buyers had no actual knowledge of limitations on the agent's authority to make representations on the quality of the carpet, the buyers were charged with a duty to discover the extent of the agent's authority. Bruce v. Calhoun First Nat'l Bank, 134 Ga. App. 790, 216 S.E.2d 622 (1975).

Third persons must take notice of special agent's instructions.

- Every man deals with a special agent at the man's peril and is bound to take notice of the agent's instructions. First Nat'l Bank v. Charles Nelson & Co., 38 Ga. 391, 95 Am. Dec. 400 (1868).

Those who deal with a special agent are charged with notice of the extent of the latter's authority, and if such agent makes a settlement not within the scope of the agency, the settlement is not binding on the principal. Baldwin Fertilizer Co. v. Thompson & McAlister, 106 Ga. 480, 32 S.E. 591 (1899).

One entering into a 15-year lease contract executed by an agent in behalf of a purported principal is charged with notice that the agent's authority to execute the lease is required by law to be in writing and is under a duty to inquire and ascertain whether such written authority exists and what the limits of the authority are, and such person is guilty of negligence in failing to make such an inquiry. Nalley v. Whitaker, 102 Ga. App. 230, 115 S.E.2d 790 (1960); Union Camp Corp. v. Dyal, 460 F.2d 678 (5th Cir.), cert. denied, 409 U.S. 849, 93 S. Ct. 56, 34 L. Ed. 2d 90 (1972).

Third persons must take notice of special agent's instructions only if included in examined authority.

- Even if a letter is treated as creating a special agency to sell particular goods to a particular person, the purchaser was only required to examine the authority and was not bound by private instructions not included in the writing. Bass Dry Goods Co. v. Granite City Mfg. Co., 119 Ga. 124, 45 S.E. 980 (1903); Hopkins & Co. v. Armour & Co., 8 Ga. App. 442, 69 S.E. 580 (1910).

Failure to inquire bars recovery from agent for misrepresenting authority.

- One who enters into a 15-year lease contract executed by an agent in behalf of a purported principal without making due inquiry into the agent's authority is precluded from recovering damages from the agent either on the ground that the agent contractually misrepresented the fact that the agent had authority, either expressly or impliedly, or on the ground that the agent fraudulently misrepresented that the agent had authority to execute the lease as agent. Nalley v. Whitaker, 102 Ga. App. 230, 115 S.E.2d 790 (1960).

Rule applies to guardian.

- Since a guardian is in effect a special agent of the law to manage the estate of a person non sui juris, it is incumbent upon all persons dealing with the guardian/special agent to examine the agent's authority. Georgia R.R. Bank & Trust Co. v. Liberty Nat'l Bank & Trust Co., 180 Ga. 4, 177 S.E. 803 (1934).

Railroad ticket agent.

- Purchaser of railroad accommodations from a ticket agent was not required to communicate with the principal and verify the agent's actual authority. Bryant v. Atlantic Coast Line R.R., 19 Ga. App. 536, 91 S.E. 1047 (1917).

Agents for indemnity company issuing unusual bond.

- If a person dealing with agents, having a written power of attorney to execute bonds, has had experience in dealing with indemnity companies and knows that the bond is an unusual obligation for an indemnity company to write and is outside the ordinary range of the business of indemnity companies, and that the bond is not executed on the regular blank form used by the indemnity company, and is not executed in the office of indemnity company or in office of its authorized agents, but is executed in office of the person dealing with agents, this does not constitute knowledge of facts sufficient to put the person dealing with agents, as a prudent person, on inquiry as to the lack of the agents' authority to bind indemnity company. Independence Indem. Co. v. Industrial Realty Co., 46 Ga. App. 637, 168 S.E. 122, aff'd, 178 Ga. 45, 172 S.E. 38 (1933).

Principal may waive objection to want of authority.

- Person who deals with a special agent must examine the special agent's authority and determine at the person's own risk whether the particular act to be done is within such authority, but this does not prevent the principal from waiving the principal's right to object to the agent's want of authority. Germain Co. v. Bank of Camden County, 14 Ga. App. 88, 80 S.E. 302 (1913).

RESEARCH REFERENCES

Am. Jur. 2d.

- 3 Am. Jur. 2d, Agency, §§ 64 et seq., 287 et seq.

7 Am. Jur. Pleading and Practice Forms, Conspiracy, § 1.

C.J.S.

- 2A C.J.S., Agency, §§ 139, 164, 165, 162.

ALR.

- Authority of agent to assent to account stated, 2 A.L.R. 71.

Authority, or apparent authority, of agent to receive payment for commodities which he has authority, or apparent authority, to sell, or for which he is authorized, or apparently authorized, to find a market, 8 A.L.R. 203; 105 A.L.R. 718.

Implied authority of servant or agent to bind employer for services of undertaker or other funeral expenses, 29 A.L.R. 457.

Liability of undisclosed principal on sealed contract, 32 A.L.R. 162.

Right of purchaser from agent or dealer in possession of article for purpose of demonstration or solicitation, without actual authority to sell, 57 A.L.R. 393.

Authority of claim agent as regards terms or condition of settlement, 87 A.L.R. 1277.

Power of sale as including power to mortgage, 92 A.L.R. 882.

Agent's authority to collect or receive payment as including implied, apparent, or ostensible authority to do so before maturity of obligations, 100 A.L.R. 389.

Implied, apparent or ostensible, and presumed authority of bank cashier to surrender or waive some right of bank, 108 A.L.R. 713.

Sole actor doctrine where officer or agent of corporation acting adversely to it is its sole representative in the transaction, 111 A.L.R. 665.

Status of gasoline and oil distributor or dealer as agent, employee, independent contractor, or independent dealer as regards responsibility for injury to person or damage to property, 116 A.L.R. 457, 83 A.L.R.2d 1282.

Agent's disregard of principal's instructions where power coupled with an interest, 162 A.L.R. 1182.

Doctrine of apparent authority as applicable where relationship is that of master and servant, 2 A.L.R.2d 406.

Authority of agent to make payment on behalf of principal, as regards statute of limitations, 31 A.L.R.2d 139.

Agent's authority to agree contemporaneously with sale to repurchase or resell or for return of personal property, 34 A.L.R.2d 510.

Power of real estate broker to execute contract of sale in behalf of principal, 43 A.L.R.2d 1014.

Implied or apparent authority of agent to purchase or order goods or merchandise, 55 A.L.R.2d 6.

Authority of agent to borrow money for principal, 55 A.L.R.2d 1215.

Liability of auctioneer or clerk to buyer as to title, condition, or quality of property sold, 80 A.L.R.2d 1237.

Agent's authority to execute warrant of attorney to confess judgment against principal, 92 A.L.R.2d 952.

Physician giving medical examination to insurance applicant as agent of insured or of insurer, 94 A.L.R.2d 1389.

Doctrine of apparent authority as applied to agent of municipality, 77 A.L.R.3d 925.


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