Case ID: rawle_1/html/0330-01.html
Source: Caselaw Access Project
Author: {"author": "Rogers, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[Lancaster,
    June 1, 1829.]
    The President, Managers, and Company of the Middletown and Harrisburg Turnpike Road against WATSON, Administratrix of WATSON.
    
      IN ERROR-.
    
    An agent of a corporation, who has received money for its use,, cannot, in an action for money had and received, brought against him by the corporation, ■ prove, by way of set-off, that he has paid the debts of the, corporation, without showing a Special authority for that purpose. And it is not enough .to prove, that the defendant acted for the treasurer, without showing some resolution. of the board, giving the treasurer a right to delegate his power tp the defendant. - ' '
    This case came before the court on-a writ of error to' the Common Pleas of Dauphin county, in which the plaintiffs in error were plaintiffs. ■, . , ' ■ .
    The.cause was argued in this court by MlClure, for the plaintiffs in error,arid Douglass, for the defendants in error; after which the opinion of the court was delivered by ",
   Rogers, J.

This is a clear case. The plaintiffs bring suit to recover from the administratrix of the .defendant certain monies, received by the intestate as a manager and agent of the company, from delinquent Subscribers. The defence is, that the money so received, was expended by the agent in'the purchase.of-the debts of the company, and this the administratrix-contends, is a legal set-off against the demand of the plaintiffs. The relation of principal and agent is vvell settled: as long as the agent acts-within the scope of his authority, and' no longer, he is protected." It was the duty of Watson to collect and pay over the funds as they came to his hands.. If was for the-company to direct the application of the money, when in the treasury, or under their control, to the discharge of their debts, the repair of the road, or whatever purposes they might suppose most beneficial to the corporation. This they have been prevented from doing, by an assumption of power by their agent, and a misapplication of the funds of the company. If such a breach of trust should be permitted, it would, in practice, lead tó great abuses, by introducing a scene of speculation and fraud the most disastrous, and of the most secret and dangerous nature. A principal may give a special authority to his agent to settle and liquidate his debts, and this is frequently done; but previous to the introduction of such a defence;'to a suit brought for money had and received, as .agent, the special authority should be shown. It is said, the defendant proved by James Montgomerythat Watson acted for-the treasurer; but they should also have-shown some resolution of the board, giving the treasurer a right to delegate this power to the defendant. The testimony, to say the least of it, is most loose and unsatisfactory, for I cannot believe, the treasurer intended to give Watson a general authority to disehárge. the debts.of the company; nor was there any proof, that he gave him directions to pay the accepted-order in favour of James II.] Espy.The general expressions, “That'Watson acted for the treasurer,” were nota sufficient foundation for the introduction of the testimony; for no person could authorize him to pay the debts, except the company, and no resolution has beeii shown, which confers this right. The plaintiff's offered to, settle the case upon equitable principles,-and-allow what was actually paid by Watsonan offer, which to my surprise, was declined.' It is the opinion of the court, the testimony was improperly received; that the judgment be. reversed, and a venire facias de novo be awarded.

Judgment reversed, and a venire- facias de novo awarded.' ■