
    John Cropper et al. versus Caleb Adams et al.
    
    A remitted from the United States to W, his general agent in London, certificates of shares in the United States Bank which stood in A’s name, and the usual blank powers of attorney to transfer them. W sold the stock to C, and at the bottom of the bill of parcels delivered C, signed an agreement, by which, in consideration of the purchase money, he guarantied the regularity of the documents, and promised t( to be accountable for such dividends as may become due and be received by me or my agent from the 1st day of January, 1829, unul transfer, provided such transfer be made within twelve months from this date.” After this sale, on May 18, 1825, XV wrote to A, requesting him, if the stock was not transferred by July 1st, to receive the July dividend, adding, " which I must pay to the purchaser.” A accordingly received the July dividend, and by the next packet remitted to W funds to a much larger amount than the dividend, intending them for the payment of the dividend and other mercantile uses, though nothing was specified as to the mode of appropriating the funds. This remittance made W indebted to A, and he continued to be so until he became bankrupt in October, 1825, never having paid the dividend to C. C, in May, 1826, demanded this dividend of A, who had never before known who purchased the stock. In an action brought by C against A for money had and received to recover the amount of this dividend, it was held, that A was originally accountable to C for the dividend ; but that the words of the contract made W the agent of C to receive the dividend, and consequently that the remittance to W exonerated A from any claim by C ; and that as the remittance brought W into A’s debt, it was not necessary to specify the object of the remittance in order to produce this effect.
    Assumpsit for money had and received, brought by the plaintiffs, merchants of Liverpool in England, against the defendants, merchants of Boston, to recover the dividends which had been received by the defendants on certain shares in the United States Bank. The case was submitted on an agreed statement of facts.
    The defendants, m the spring of 1825, remitted to Samuel Williams, a banker and commission merchant in London, one hundred and thirty shares in the stock of the United States Bank, owned by them, to be sold on their account. Williams, on April 19, 1825, sold to the plaintiffs, through a broker, eighty shares, and then made and signed the following documents : —
    “ London, 19 April, 1825.
    Dr. to Samuel Williams for the following U. S. Bank shares with the dividend from the 1st day of January, 1825.
    
      No. 3S7 — 25 in the name of C. & C. F. Adams. “ 374 — 55 “ “ “ “ “
    80 a £25 per share.
    London, 23 April, 1825.
    Received of the sum of
    pounds, being the full purchase money for the abovementioncd bank shares, of the United States of America, certificates for which I now deliver with power of attorney for transferring tie same ; and do hereby guarantee the regularity of said doc ti-men ts, and promise to be accountable for such dividends as may become due and be received by me or my agent from the 1st day of January, 1825, until transfer, provided such transfer be made within twelve months from this date.
    S. Williams.”
    On the 10th of May, 1825, Williams sold to the plaintiffs the remaining fifty shares, giving a similar document.
    These documents were made in blank to enable purchasers to dispose of the stocks and transfer them by delivery of the documents. But the defendants were not informed to whom the documents were sold or delivered.
    The stock continued to stand in the defendants’ names in the books of the bank until after January, 1826 ; and they, by the usages of the bank, were entitled to receive the dividends on the shares standing in their names, without producing the certificate of ownership. On July 18j 1825, a dividend of profits was made by the bank of two and three quarters peícent, amounting on the 130 shares to 357 dollars 50 cents, and a like dividend of the same amount was made January 18, 1826, both of which were received by the defendants. The defendants on June 29, 1825, received a letter from Williams, dated London, May 18, 1825, in which he says, “ I beg your reference to my respects of the 28th ult. and confirm the same, except as to the transfer of the bank shares, upon which I paid the dividend to the 1st of Jan. last. Since then I have ascertained that they have not been yet transferred, and if you find that also to be the case on the 1st of July next, you will retíeive another half year’s dividend, and I must pay it to the purchaser here.”
    The defendants, after having received the July dividend, remitted to Williams by the next packets on 22d and 30th of July, 2227Z. in exchange, which was received August 22d and 31st, and became cash September 24th and October 3d, 1825, for the payment of this dividend and other mercantile uses, but without any specification of the dividend or other purposes. Williams, by these remittances, became indebted to the defendants, and has ever since continued so.
    Williams became bankrupt October 25, 1825, and has never paid the plaintiffs, nor any one else, the amount of the dividend. After Williams’s bankruptcy, the plaintiffs, by their agents, made a demand on the defendants for the dividends which they had received ; the defendants paid the dividend of January, 1826, which they had received after they knew of Williams’s bankruptcy, but declined paying that of July, 1825.
    The letter of attorney to Williams, and his receipt and guaranty and bill of sale, continued in blank, and might have been transferred indefinitely up to May, 1826, without any possibility of the defendants’ knowing who was the owner, and they were never informed, until that time, that the plaintiffs were the owners.
    The defendants were to be defaulted or the plaintiffs to become nonsuit, according to the opinion of the Court.
    The case was argued in writing.
    
      Shaiv, for the plaintiffs. Williams, in selling the stock, was agent for the defendants.
    The dividends from January 1, 1825, passed by the express words of the contract, and even without any express words, the dividends declared after the time of the sale, would belong to the purchasers. The dividend of July, 1825, therefore, belonged to the plaintiffs, and when the defendants received it, they received it for the use of the plaintiffs, and became liable to account for it to the plaintiffs in an action for money had and received. If it is objected that the defendants are thus made liable to persons whom they did not know, it is sufficient to reply, that they voluntarily chose to incur a liability of this kind, by sending out their powers of attorney p transfer the stock, in blank. This they did, because they thus made the shares transferable more conveniently, and therefore more saleable. Every person who becomes party to a negotiable instrument, may in the same manner become liable to an unknown person.
    It may be argued on the other side, that the defendants were agents of Williams, and that this is proved by the words of the instrument given by Williams. But the mere calling one party an agent does not make him so ; whether he is agent or not, must depend on the relation in which the parties stood to each other. The defendants could not have been agents of Williams in receiving this dividend, for Williams had no interest in the stock, and could not have received the dividend himself. The word “ agent,” which is inapplicable in this case, was adopted carelessly, because a printed form was used which contained this word. The printed form was undoubtedly intended for a person who was himself owner of the stock.
    The obligation of the defendants, created by the transfer, was direct, to pay such dividends as they received, to the plaintiffs. The guaranty of Williams was a collateral undertaking that the dividends should be paid ; and did not supersede or discharge the liability of the defendants.
    If it is contended, that the defendants are exonerated in consequence of their having placed funds in the hands of Williams, sufficient to pay the plaintiffs this dividend, we reply, that Williams was not the agent of the plaintiffs, but of the defendants, and if he became bankrupt with the money of the defendants in his hands, it is their loss, and not the loss of the plaintiffs. Besides, no part of the money of the defendants in Williams’s hands was ever specifically appropriated by them to the payment of this dividend; he, therefore, could not have received any part of it as agent for the plaintiffs.
    
      Loving, for the defendants.
    The sales of the stocks by Williams to the plaintiffs was a sale by him as owner of the stocks, and not a direct sale from the defendants to them through his agency. This is evident from the language of the instruments in the case. The defendants, in receiving the dividend, acted as agents, and, having paid it over to him, cannot be under any liability to the plaintiffs.
    
      If, however, the sale is to be considered as immediate from the defendants to the plaintiffs through the agency of Williams, still the payment to Williams exonerates the defendants, because by the terms of the instrument of sale Williams became the authorized agent of the plaintiff to receive these dividends.
    A payment to him, therefore, was the same as a payment to his principals. Besides, the name of the plaintiffs as purchasers, was never made known to the defendants until after this dividend was paid to Williams. And it is well settled, that a payment to an agent dealing as such, without disclosing the name of his principal, is a good payment in discharge of the debt. Morris v. Cleasby, 1 Maule & Selwf 576; 1 Chit. Pl. 25; George v. Clagett, 7 T. R. 359, and notes; Montagu on Set-off, 29, 31, and notes; Drinkwater v. Goodwin, 1 Cowp. 251.
    It cannot fairly be denied, on the other side, that the remittance to Williams was intended as a payment of this dividend, although it was not specified, since the remittance was made soon after receiving Williams’s letter requesting them to receive and remit the dividend, and was to such an amount as left Williams deeply in their debt.
    
      March 16th, 1829.
   Parker C. J.

delivered the opinion of the Court. This 1 is somewhat of a difficult question, and it seems there are no authorities to assist us in coming to a decision, for in the elabo rate argument submitted in writing, none are cited, except to a point which is sufficiently clear, viz. that payment to an agent, while his authority continues, and without prohibition from the principal, shall be a discharge against the principal. The argument on both sides consists of reasoning from well known principles, and an application of those principles to the case submitted ; and we must take the same course to arrive at a decision.

First, then, it is clear from the facts stated, that Williams, in the sale of the shares, was merely the agent of the defendants. He was their factor in London, and they sent him these shares to sell on their account. He sold for cash, and credited them in his books for the proceeds. The sale was made in such form as to enable the purchaser to sell the same shares by delivery only of the documents which he had received : and the documents were sent on to enable the factor to make such a sale. They were not remitted to him, like a bill, to take to his own account, but as a means of raising money for the use of the defendants. Williams might have sold them without any personal guaranty or liability, if he could have disposed of them on those terms. If he might have taken them to his own account, he did not, for the sale was made on May 10, 1825, and on the 18th of that month he informs the defendants by letter, that he had sold on their account, and he renders an account of his agency.

He undertakes to guaranty the genuineness of the documents, and for this he charges a commission, and he stipulates for the payment of all dividends after January 1, 1825. This was necessary, as those dividends remained payable to the defendants until the record of ownership should be changed in the bank; but this seems to be an independent obligation on his part, which does not affect the liability of the defendants ; for such dividends as they might receive, by virtue of their credit on the books of the bank for the same, the bank knowing of no proprietor but them, until a transfer should be made on the books, would certainly be received by them to the use of the purchasers. Suppose that on the failure of Williams the first dividend had not been remitted to him, could it be doubted that the bona fide holders of the shares could recover the dividend received by the defendants ? Did they not in law receive it to the use of the owners of the shares ? By virtue of the contract of sale made through their agent, the defendants had parted with the shares and the dividends accruing; they became in equity the agents of the purchaser in receiving the dividends, and if they had refused to receive, as the purchaser would not, by the rules of the bank, be able to obtain payment without their agency, I think an action would lie against them for this refusal or neglect, because when they sold the shares, with the dividend on and accruing, and their agent in the sale had given a year for the transfer in the books, they undertook by implication to receive for the purchaser what he could not receive but through them. •

Does the contract of the factor with the purchaser to guaranty the stock and the payment of the dividends, destroy this liability of the principals to the purchaser ? I do not see that it can. It is merely an assurance that the defendants will do their duty, and such assurance was probably necessary to a sale for the full value, as the vendors were strangers, living in a foreign country.

Then the question remains, whether Williams is to be considered as agent for the purchasers, so that a remittance to him of the dividend will discharge the defendants ; and I think this is settled by the terms of the contract made by Williams and accepted by the plaintiffs. He promises to be accountable for such dividends as may become due and be received by him or his agent, from the 1st of January, 1825, until transfer. Why is not this an agreement on the part of the plaintiffs, that Williams shall receive, or employ some one to receive ? And if so, the defendants having had notice from Williams that he was to receive, accompanied with a request that the defendants would obtain the dividends, stating that he should pay them, a remittance until prohibited must be a payment as it regards the defendants. And it is to be considered, that the defendants were wholly ignorant who were the purchasers or in whose hands the certificates were, so that they could not remit to any person but Williams. After the bankruptcy of Williams, and notice to them who the owners were, they were bound to pay to the owners the future dividends, and they have done so.

It is agreed that the remittance made by the defendants to Williams in September and October, 1825, was for this dividend and for other mercantile uses. If Williams was the agent to receive., it cannot make a difference, that there was no specification of the dividend as an object of the remittance. The defendants being then creditors of Williams, he could have applied the remittance to this object. If they had been indebted, a particular appropriation might have been necessary.

We think on this last ground the defendants are discharged, and that the plaintiffs must look to the estate of Williams.

It is suggested in the argument for the plaintiffs, that the payment by the defendants to the plaintiffs of the dividend last received, which was after the bankruptcy of Williams and after notice of the plaintiffs’ right, is a recognition of the right of the plaintiffs. That right cannot be disputed after notice to the defendants ; but before that, to whom should the de fendants have remitted, if not to Williams ? Certainly to no body ; and yet they were requested by Williams to remit to the plaintiffs, he having engaged to pay. We cannot imagine a stronger case of authority to receive, than Williams had, by virtue of the written acknowledgment of the plaintiffs in their receipt. They looked only to him for the dividends, and in consequence of this arrangement and of the notice by Wil liams to the defendants, the remittance was made.

Plaintiffs nonsuit:  