Case Name: Stephen W. Snow versus Abner Perry
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1830-09
Citations: 9 Pick. 539
Docket Number: 
Parties: Stephen W. Snow versus Abner Perry.
Judges: 
Reporter: Massachusetts Reports
Volume: 26
Pages: 549–552

Head Matter:
Stephen W. Snow versus Abner Perry.
Where the maker of a promissory note sent bills of a certain bank to the payee, with instructions to the messenger to see that the amount was indorsed on the note, or to take a receipt, and the payee took the bills, and gave a receipt by which he promised to indorse the amount or return the bills when called for, and the next day, and before the maker had notice of this conditional receipt, the bank failed, it was held, that the taking of the bills was a payment pro tanto, the messenger being a special agent and having exceeded his authority in taking a conditional receipt.
Assumpsit on a joint and several note, payable by Perry and J. West to Seth Snow or order, and indorsed by the payee to the plaintiff when over-due and after the receipt hereafter mentioned had been given.
Payment of $300 on'May 20th, 1829, which was previous to the indorsement, was proved to have been made in bills oc the Columbia bank, at Hudson, for which a receipt was given by the payee as follows: — “Becket, May 20, 1829. Received of J. West and A. Perry, by the hands of Amos West, son of J. West, 300 dollars in bills on the Columbia bank, Hudson, which I agree and promise to indorse on a note I hold against West and Perry, or return the same when called for. Seth Snow.” On May 21st, 1829, the bank stopped pay ment. Snow lived in Becket, West in Lee and Perry in New Lebanon, several miles from each other and from the bank at Hudson. It was proved that the bills were sent by Perry, or West and Perry, by a boy, the son of West, with directions to deliver them to Snow,-and to see their amount indorsed on the note, or to take a receipt for the same. It was also proved, that the bills so sent were the property of Perry; and that at the time of the service of the writ, Snow had given no notice to Perry that he had not applied or would not apply them towards payment of the note. There was evidence tending to show, that about a week after the receipt of the bills, notice was given to West that they would not be so applied. Perry’s instructions to the boy were, that the money should not be left unless he saw it indorsed on the note , and the boy testified, that Snow, who was from home, agreed to indorse it when he should return home at evening ; but in this he was contradicted by Snow. The boy further testified, that he told Snow that Perry sent the money. It was proved that the receipt did not come to the hands of Perry until five days afterward, and there was no evidence that he had previous knowledge of it, or that Snow had ever returned or offered to return the money. And the testimony of Snow, that he gave notice to West, was contradicted by West.
Wilde J. instructed the jury,
that unless they were satisfied that Snow, the payee, gave reasonable notice to Perry that he should not apply the bills in payment, they must return a verdict for the defendant; and that if Snow was doubtful of which of the promisers the bills had been received, it was his duty to ascertain that fact, especially since at the time the supposed" payment was made, West was, and for some time previous had been, insolvent.
If these instructions were wrong, a new trial was to be granted ; otherwise judgment was to be entered on the verdict.
Byington, (with whom were Bishop and Filley) for the plaintiff.
Notice that the bills were received conditionally, was given to West seasonably, as earlier notice could have been of no use. It does not appear that Snow knew of the insolvency of West, and he was not bound to inquire who sent the bills, payment by one of the promisers being a payment by both ; and if Perry wished to make the payment several, he should have given notice of his intention. The bills were sent with instructions that the sum should be indorsed on the note, or a receipt be given, but it does not appear that Snow knew of these instructions, and he refused to receive the bills as payment. Perry knew that the bills were not a lawful tender, and it was for him to inquire of his agent whether they had been accepted. If the agent exceeded his instructions, the defendant is to suffer. Snow may be liable for receiving and keeping the bills without right, but this does not prove that there was a payment.
Porter, for the defendant,
contended that the iirstructions to the messenger made him a special agent, and that in taking the receipt in question he had exceeded his authority ; so that Perry was not bound by his acts. E. I. Company v. Hensley, 1 Esp. R. 112 ; Fenn v. Harrison, 3 T. R. 757 ; 1 Com. Contr. 240 ; Chit. Contr. 58. Retaining the bills was a payment, as Snow had no right to retain them except as a payment. It is uncertain whether West had notice of the conditional acceptance, but the plaintiff knew that Perry sent the bills, and notice to West would not affect Perry.

Opinion:
Per Curiam.
As the verdict is for the defendant, we presume the sum due on the note, except $ 300, has been paid. The question is, whether the sending of the bills by the defendant Perry, and the receipt of them by the plaintiff in the manner stated in the report, constituted a valid payment.
In the view of the case taken by the Court, the questions whether the plaintiff would be bound to give notice of his intention not to accept the bills in payment, and to whom and within what time such notice should have been given, become immaterial.
The bills were sent as cash, the bank being then good, for the express purpose of being applied in payment of this note, with directions to the lad who carried them, to see them thus applied, either by an indorsement on the note, or by a separate receipt, or to bring back the bills. Bank notes are considered a good tender, unless objection is made on that account, and here no such objection was made by the creditor. Wright v. Reed, 3 T. R. 554.
But the plaintiff relies upon the terms of the receipt, stated m the report, and the condition or alternative therein expressed. If this receipt had been given by Perry himself, or by an agent, competent to bind him in this respect, he would be bound by the condition. Then the question recurs, could the messenger, consistently with his authority, accept such receipt. He was instructed to see the money indorsed, or to take a receipt as for so much money received in payment, or to bring the aills back. This was the extent of his authority.
An agent with limited authority cannot exceed it, and if he does, his principal will not be bound by his acts, unless he affirms them afterwards. Fenn v. Harrison, 3 T. R. 757 ; 1 Com. on Contr. 240. The party dealing with a special agent is bound to inquire and ascertain the extent of his authority. Chitty on Contr. 58. Here there is no ground to maintain that the defendant Perry, or either of the defendants, affirmed the act of the messenger in taking a conditional receipt. Suppose specie had been sent instead of bank notes, with similar directions, and a similar receipt had been taken by the messenger ; it seems very clear, that a special agent, with such limited authority, would have bad no power to bind the debtors, by accepting a receipt containing such a condition.
As these bank notes were offered to the holder of the note in payment, and were not objected to upon that ground, but were actually received by the holder, and as the right to return them and rescind the payment, implied by the condition in the receipt, was not given by any act done or authorized by the defendants, the Court are.all of opinion, that the acceptance of them was a payment pro tanto, and therefore that there must be judgment according to the verdict.
See Polglase v. Oliver, 1 Price's P. C. 133 ; 2 Tyr. 89 ; 2 Crompt. & Jerv. 15; Brown v. Saul, 4 Esp. 267; Tiley v. Courtier, 2 Crompt. & Jerv. 16, note Warren v. Mains, 7 Johns. R. 476.
See Story's Comm. Agency; 115 et seq., and cases cited in the notes Chitty on Contr. (4th Am. ed.) 174 et seq.