First National Bank v. Babbidge

36 N.E. 462, 160 Mass. 563, 1894 Mass. LEXIS 327

• Court: Massachusetts Supreme Judicial Court
• Decided: March 1, 1894
• Status: Published

Opinion

Allen, J.

This case comes up on a report, and although the defendants do not appear to argue the question presented, we have considered it. If Linley alone had acted in discounting the note and in placing the proceeds to his own credit, the bank would be bound by his knowledge of the circumstances under which he had obtained it from the defendants. Atlantic Cotton Mills v. Indian Orchard Mills, 147 Mass. 268. But he did nor act alone. The cashier of the bank was the officer who actually did these things. Linley in this transaction was not the representative of the bank. He was obtaining from the bank the discount of a note for his own benefit, and thereupon on the face of the transaction he was on one side of the bargain and the bank on the other. The cashier was the sole representative of the bank. To be sure, the act was beyond his authority while acting alone, yet he may not have thought so, under the circumstances. At any rate, there is no suggestion that he was in collusion with Linley, or that he had any reason to doubt that what he did was for the interest of the bank. If the bank might have repudiated his agency, it did not do so; and even though he may have gone beyond his authority he was a financial officer and agent of the bank, and was acting for it and for nobody else, and his agency has not been disavowed, and under these circumstances Linley’s knowledge is not to be imputed to the bank, and the bank is entitled to recover on the note. Corcoran v. Snow Cattle Co. 151 Mass. 74. Allen v. South Boston Railroad, 150 Mass. 200, 206. Innerarity v. Merchants’ National Bank, 139 Mass. 332. Judgment on the verdict.