arises that the employment was renewed for the same wages and term as for the previous term." (Decided by the Supreme Court of California in the case of Gabriel vs. Bank of Suisun, which decision is printed in Volume 28, California Decisions, page 720.)

Civil Code, Section 94.

Section 94. WHEN SERVANT MAY BE DISCHARGED.-The law is that a master may discharge any servant, other than an apprentice, whether engaged for a fixed term or not, if he is guilty of misconduct in the course of his service, or of gross immorality, though not connected with his service; or if, being employed about the person of the master or in a confidential position, the master discovers that the servant has been guilty of misconduct before or after the commencement of his services, of such a nature that the master, had he known or contemplated the facts, would not have employed him.

Civil Code, Section 2015.

Principal and Agent.

Section 95.-DEFINITION OF AGENCY.-An agent is one who represents another, called the principal, in dealings with third persons. And as a great part of the business of all communities is transacted through the medium of agents, it is proposed in following sections to give the law of California applying to the relative rights and obligations of Principal and Agent in this state.

Section 96.- KINDS OF AGENCY.-There are two kinds of agents, special agents and general agents. An agent for a particular transaction is called a special agent, because he is appointed with special power to do that particular thing. A general agent, on the other hand, has a general authority conferred upon him to transact business

of his principal, which includes more than one particular act. An agency, when it exists at all, is either actual or ostensible. An agency is actual when the agent is really employed by the principal. An agency is ostensible when the principal intentionally or by want of ordinary care causes a third person to believe another, who is not really employed by him, to be his agent.

Civil Code, Sections 2230, 2297, 2298, 2299.

Section 97.-AUTHORITY OF AGENT.—An agent has authority to do whatever his principal might do in the business for which he is employed. He has authority to do everything necessary or proper and usual, in the ordinary course of business, for effecting the purpose of his agency. But he has only such authority as the principal confers upon him, and he will be limited in his authority to the particular business for which he is employed. Whatever he does within the scope of his employment, necessary or proper and usual, in the ordinary course of business, to effect the purpose of his agency, will be binding upon his principal. His declarations as to the subject of his agency, within the scope of his employment, will bind his principal; as where an agent employed to sell goods makes at the time a representation as to their quantity or quality.

Civil Code, Sections 2315, 2319, 2320.

Section 98.-WHAT INCLUDED IN AUTHORITY TO SELL PERSONAL PROPERTY.-An authority to sell personal property includes authority to warrant the title. of the principal, and the quality and quantity of the property. Civil Code, Section 2323.

Section 99.-WHAT INCLUDED IN AUTHORITY TO SELL REAL ESTATE.-An agent's authority to sell and convey real property includes authority to give the usual covenants of warranty.

Civil Code, Section 2324.

Section 100.-AUTHORITY OF AGENT TO RECEIVE PRICE OF PROPERTY.-A general agent to sell, who is intrusted by the principal with the possession of the thing sold, has authority to receive the price. A special agent to sell has authority to receive the price on delivery of the thing sold, but not afterward. But neither a general nor a special agent to sell has any authority to receive anything but money in payment of the price of the thing sold. Therefore, if the agent sells property of his principal, and accepts part cash and part in something else, the principal will not be bound.

Civil Code, Sections 2325, 2326.

Section 101.—AGENT'S POWER TO DISOBEY INSTRUCTIONS.-An agent has power to disobey his instructions in dealing with the subject of the agency, in cases where it is clearly for the interest of his principal that he should do so, when there is not time to communicate with the principal. The general rule is, that an agent must follow and adhere to the instructions and authority he has received from his principal, but under some circumstances he may depart from his instructions, and the law will justify him, and his principal will be bound. So where, from the necessities of the case, without the agent's fault or neglect, some sudden and unexpected emergency or extraordinary or supervening necessity arises, or some unforeseen event happens, which will not admit of delay for consultation or communication with the principal, if the agent, exercising prudence and sound discretion, in good faith adopts the course which seems best to him, under all the circumstances as they exist, he will be justified, and his acts will bind his principal, though subsequent events may demonstrate that some other course would have been the better.

Section 102.-AGENT CANNOT HAVE AUTHORITY TO DEFRAUD PRINCIPAL.-An agent can never have authority to do any act which is a fraud upon the principal, and is known or suspected by the person with

whom he deals to be fraudulent. The agent must act in good faith with his principal, and if he enters into collusion with another to obtain an advantage over his principal, or to obtain the property of the principal for less than it is worth, the courts of this state will be ready to give the principal relief against both, by restoring to him the property of which he has been defrauded, or, if this cannot be done, by giving him damages as compensation. Many illustrations might be given. Where an agent invests money belonging to his principal for the purchase of an interest in a syndicate, of which the agent is a member, and in which he holds an interest, and which is indebted in a large amount, and, to induce the investment, leads the principal to believe that he is not a member of the syndicate, or interested therein, and represents that the principal will not have any calls to pay upon becoming a member thereof, the law imputes fraud on the part of the agent, and the principal may avoid the transaction and recover from the agent the amount so invested. So, it is the law of this state, that an agent must not unite his personal and his representative characters in the same transaction; for the law will not permit him to be exposed to the temptation, or brought into a situation where his own personal interests will conflict with the interests of his principal. In dealing without the intervention of his principal, if an agent for the purpose of selling property of the principal purchases it himself, or an agent for the purpose of buying property for the principal buys it from himself, either directly or through the instrumentality of a third person, the sale or purchase is voidable, and will always be set aside at the option of the principal.

Civil Code, Section 2306.

Section 103.-AGENT'S ACTUAL AUTHORITY.— The acutal authority of an agent is such as a principal intentionally confers upon him, or intentionally or by want of ordinary care allows the agent to believe himself to be possessed of. An agent's authority is actual when there is a contract of employment existing between him and the

principal. The principal may have given the agent instructions to act in a certain way; or a course of dealings or other circumstances between them may have been such as to lead the agent to believe that his authority from the principal extended to the things done; or the principal may have stood by and without objection witnessed the conduct of the agent, and thus made the agent believe that his authority from the principal was sufficient to warrant the acts done by him; and in all such cases the agent will be deemed to have had authority actually given him by the principal. Civil Code, Sections 2299, 2316.

AUTHOR

Section 104.-AGENT'S OSTENSIBLE ITY. The ostensible authority of an agent is such as the principal, intentionally or by want of ordinary care, causes or allows a third person to believe the agent possesses. There are two essential features of an ostensible authority; the third party must believe that the agent has authority; and such belief must be generated in his mind by some act or neglect of the person whom he seeks to hold liable as principal. A belief founded on the agent's statement is not sufficient; for a party has no right to take the agent's word for the existence of his authority. But where the agent shows letters or telegrams, which are worded so as to lead a reasonable man to believe that he has received authority from the principal to act for him in a certain way; or where the principal has been in the habit of receiving money, for shipments of products or goods, through the same agent, in similar transactions; or where the principal has been in the habit of honoring drafts signed by the same person as his "agent"; or where similar transactions have occurred in which the acts of the alleged agent were authorized or ratified; in all such cases, if the third party knows of the former transactions, and has received no notice that the principal will not be responsible, he will be justified in believing that the agent has authority, and the principal will be bound, even though the person for whom the agent assumes to act may not have intended to hold him out as