Court Opinion

ID: 9693533
Source: CourtListenerOpinion
Date Created: 2023-08-25 16:48:10.196412+00
Date Added: 2024-06-11T18:19:48.187794
License: Public Domain

R. M. Maher, J.
(dissenting). I respectfully dissent. Unlike my colleagues, I am not convinced that the trial court’s finding that Payco notified National of the counterclaim is clearly erroneous.
In addition, I am of the opinion that notice to Payco was in fact notice to National. It is well established that notice to an agent acting within *371the scope of his authority is notice to the principal as well:
"It is a general rule that notice of a fact acquired by an agent while transacting the business of his principal is notice to the latter and this rule applies to banks and other corporations as well as to individuals. It is the duty of the agent to communicate to the principal information thus acquired which would affect the rights of the former and the presumption is the agent has performed his duty in this behalf. If he has not, still the principal should be charged with the knowledge of his agent because he selects him and confides to him the business in hand.” Schram v Burt, 111 F2d 557, 564 (CA 6, 1940).
Accord, Chelsea Associates v Rapanos, 527 F2d 1266 (CA 6, 1975), Westinghouse Electric & Manufacturing Co v Hubert, 175 Mich 568; 141 NW 600 (1913), Thornton v City of Flint, 39 Mich App 260; 197 NW2d 485 (1972).
National engaged Payco as its agent for collection of S & D Leasing’s debt to National, authorizing it to hire an attorney to bring an action in National’s name, if necessary to collect the debt. It was while acting within the scope of this authority that Payco learned that a counterclaim had been filed, surely a not unexpected development in a lawsuit. Upon receiving this information, Payco was under a duty to convey it to National. All third parties, including the subsequent attorney engaged by Payco on behalf of National, were justified in assuming that Payco would carry out that duty. That Payco breached its duty (if in fact it did) is irrelevant, and National is charged with notice of the counterclaim.
I would affirm the^trial court.