Independent B. & L. Ass'n v. Real Estate Title Co.

Opinion by Mr. Justice Mitchell, Thompson was the solicitor of the appellant company and authorized to act for it in matters coming to him in that capacity. Of this Mrs. Wilson was informed, for she not only saw him at the company’s office, but was referred to him by the application clerk. She had made two applications to the appellant for loans of money, the first to be secured by mortgage on her Thompson street property, and to be used chiefly to pay off the plaintiff’s mortgage, the second to be secured by mortgage on the Morris street house, and to be used as part of the purchase money for it. The appellant was not only to lend the money, but also to do the conveyancing of both operations, and its solicitor, Thompson, was the officer to whom Mrs. Wilson was referred for that purpose. To get possession of the Morris street house, for which she was urgent, Mrs. Wilson paid the appellant $950 which were to he used in the settlement with the vendor. This was paid by direction of the application clerk, to Thompson; who unquestionably received it as an officer and agent of the appellant. When however that transaction was closed with the vendor, the appellant did not apply the $950 to it, but settled with the money it was to loan on the other application, leaving the $950 of Mrs. Wilson’s money in Thompson’s hands. But the money to be advanced on the other application was specifically understood to be for the pay [192] ment of plaintiff’s mortgage, which is marked in the application as to be paid off, and it must necessarily have been so to maleo appellant’s mortgage safe. Thompson who thus mixed up the two transactions was the officer of the appellant, and did it in that capacity. Further, in the same capacity he notified the plaintiff’s treasurer to come for settlement, and directed him to take the preliminary step by entering satisfaction on the plaintiff’s mortgage, whereupon he would receive the money. All this the appellant was bound to know, and whether it knew in fact or not, it was liable, because Thompson’s acts were done as its officer, and it was his position as such that gave him the opportunity. It is clear therefore that not only the Wilsons, but the plaintiff, had an equity against the appellant to make good to them any loss from Thompson’s misapplication of that fund. This brings us to the second branch of the case, whether the act of Gourley, the plaintiff’s treasurer, in taking Thompson’s check, and by Thompson’s request holding it for three days, was an acceptance of Thompson’s individual obligation which discharged the appellant from liability. This question is not free from difficulty. In theory the payment of the money and the satisfaction of the mortgage are dependent parts of the same transaction and should be contemporaneous. But the court is entitled to take notice that in cases like the present of replacing an old mortgage by a new one to a different party, the acts in practical business seldom are contemporaneous. The plaintiff’s mortgage was the first incumbrance; until it was actually satisfied of record, the appellant could not get a clear search showing the priority of its own mortgage, to go among its title papers, and such requirement, if not the uniform custom of Philadelphia conveyancing, is at least frequent enough to relieve compliance with it from any prima facies of being out of the ordinary course of business. The act of Gourley therefore in satisfying plaintiff’s mortgage before the receipt of the money was not a substitution of Thompson’s personal liability for that of appellant. Nor was the acceptance of Thompson’s personal check. For the purposes of this transaction Thompson was the appellant, the officer who was authorized to represent it, and the only one with whom the plaintiff had anything to do. The transaction itself was a loan of fourteen hundred dollars [193] to Mrs. Wilson, but the money was not handed to her, the company itself took charge of the application of it, one thousand and odd dollars to pay off the plaintiff’s prior mortgage, the rest for the expenses of searches, conveyancing, etc., and then the balance to Mrs. Wilson. Thompson was the officer of the company who handled this sum for these purposes, and when he gave Gourley half a dollar to pay for the entry of satisfaction on the mortgage Gourley was not bound to ask him if that was his own or the company’s money, he was entitled to presume it was the company’s, and the same presumption fairly attaches to the check for the amount of the mortgage, although 'in form it was the personal check of Thompson. The same view applies to the compliance with Thompson’s request to hold the check until Saturday. This result might be reached summarily on the familiar ground that where one of two innocent parties must suffer by the fraud of another, the one who afforded the opportunity must bear the loss. This request of Thompson was clearly part of his fraudulent scheme, and it was his position as appellant’s officer that enabled him to carry it out. But beyond this we are of opinion, though we have not reached it without some hesitation, that the compliance with the request to hold the check was not so far out of the usual course of business as to amount to a discharge of appellant. Transactions of this kind usually occupy some time. There are papers to be prepared and executed, searches to be procured, interest and expenses to be calculated, and the money to be got for the balance on final settlement. This particular loan had in fact been pending since the previous December. During all that time it had been in Thompson’s hands, though it was the company’s matter, with which he had no personal concern, but was acting as the company’s officer. Gourley might fairly suppose the delay requested was on the part of the company, for reasons connected with the settlement; such belief on his part would be a natural result of the action of the company in giving Thompson entire authority, actual or apparent, over the matter, and its admitted pendency for more than six months. The question of jurisdiction may be briefly disposed of. The bill was for the cancellation of the entry of satisfaction on complainant’s mortgage, and its reinstatement as a prior lien to [194] appellant’s mortgage, on the ground that the entry had been procured by the fraud of appellant’s agent, and although an action of assumpsit might have been brought on the agent’s promise, or for money had and received for plaintiff’s use, yet relief in a clear subject of equity jurisdiction is not barred by the existence of a remedy at law, even if, in view of the triangular nature of the contest here, between the rights of the plaintiff, the appellant and Mrs. Wilson, that remedy could be considered adequate. We have not thought it necessary to notice in detail the numerous assignments of error, even as reduced and classified in appellant’s argument. We have considered the case on the’ facts found by the master, because careful perusal of the evidence has failed to satisfy us that those found are not correct, or that those omitted in the findings would change the result. The case is one of hardship in anjr aspect, for it involves loss through the fraud of a person trusted by all parties, but the general conclusion is unavoidable that Thompson was the agent of appellant, with actual authority as to a large part of the transactions, and with such apparent authority throughout, as to make it answerable for his action. Decree affirmed.