
    Carroll v. Tucker.
    (New York Common Pleas
    General Term,
    February, 1893.)
    In an action for broker’s commission on a sale of realty, it appeared that defendant employed one T. to make the sale. It was conceded that plaintifE was not retained directly by defendants, but that he was commissioned by their agent, T. T. testified, “We were both brokers in the matter; there was a sort of implied understanding between brokers that I would divide commissions with him.” PlaintifE testified that T. “told me he would pay mo a commission.” Before commencing the action, plaintiff threatened suit for only half the commission. Held, that plaintiff’s employment was by T. on an agreement to divide his commission; and that so, as subagent, plaintiff sustained no such relation to defendants as made them liable for his compensation.
    Also held, that assuming that T. employed plaintiff as broker for defendants, it was incumbent on plaintifE to prove that T. had authority so to do.
    Plaintiff claimed that defendants empowered T. to substitute another in his stead, which was denied by them. But plaintiff relied on an alleged admission of defendants to the contrary. Before commencing the action, plaintiff’s attorney called on defendants to ascertain “ whether T. had authority to bind defendants, or to sell and employ a broker.” Defendants said “that T. was authorized to take any steps necessary to sell.” Held, that this did not involve authority on T. to employ another broker.
    Also held, that the rule “when an agent, acting within the scope of his actual authority, perpetrates a fraud for the benefit of his principal, and the latter receives the fruits of it, he thereby adopts the fraudulent acts of his agent,” does not apply so as to validate a delegation of his agency by a broker.
    Appeal from judgment of the General Term of the City Court affirming judgment on a verdict.
    Action for broker’s commission on a sale of realty. The opinion states the case.
    
      John Brooks Lea/oiU, for defendants (appellants).
    
      Lyma/n L. Bettel, for plaintiff (respondent).
   Pbyob, J.

At the close of plaintiff’s case, the defendants moved a dismissal of the complaint, on the grounds that the plaintiff had no authority as broker of the defendants, and was not the procuring cause of the sale; and the motion was renewed upon all the evidence.

We are of the opinion that enough was shown to authorize the inference that the sale was effected through the instrumentality of the plaintiff; but whether he acted upon the employment of the defendants is a more difficult question.

It is a conceded fact that the plaintiff was not retained directly by the defendants; hut the contention is that he was commissioned by then* agent, Thompson. And so he was, without doubt; hut whether as subagent of Thompson or as independent broker for the defendants, is a point upon which, in a measure, the appeal depends. Thompson was the broker whom the defendants employed; and if, to promote the sale, he engaged the plaintiff as his auxiliary on an agreement to divide commissions, then, as subagent, plaintiff must look only to Thompson for compensation. Thompson testifies, “We were both brokers in the matter; there was a sort of implied understanding between brokers that I would divide ■commissions with him.” Plaintiff says, Thompson “ told me he would pay me a commission ” — a commission, not the commission, and he, not the defendants, would pay it. Obviously, the plaintiff’s own version of the transaction is in harmony with Thompson’s statement that he was to divide his commission with the plaintiff. But that the plaintiff understood he was only to share Thompson’s compensation is cleared of all doubt by the fact that he presented a bill and threatened suit for only half the commission. True, the claim for half commission was asserted against the defendants; but that only shows plaintiff’s mistake as to the party legally liable to him. True, also, that the next day plaintiff’s attorney made demand of the full commission; but that only shows the attorney’s .skill in trying to nullify the effect of the client’s admission.

Our conclusion is that, upon the uncontradicted evidence, plaintiff was employed by Thompson to assist him in the negotiation on an agreement to divide his commission; and •.that so, as subagent, plaintiff sustained no such relation to the defendants as made them liable for his compensation. 1 Am. & Eng. Ency. of Law, 395.

Assuming, however, that Thompson employed plaintiff as broker for the defendants, it was incumbent upon plaintiff to prove that Thompson had authority so to employ him. Without specific authority from his principal, an agent has no power to delegate his trust. Lewis v. Ingersoll, 3 Abb. Ct. App. Dec. 55; Newton v. Bronson, 13 N. Y. 587; Hicks v. Dorn, 9 Abb. (N. S.) 53; Merrill v. Farmers' Loan, etc., Co., 24 Hun, 300 ; Lyon v. Jerome, 26 Wend. 485. Indisputably, the office of broker involves personal confidence and discretion. Bonwell v. Howes, 15 Daly, 43.

Did the defendants empower their broker Thompson to substitute another in his stead? Both Thompson and defendant Arthur 0. Tucker, deny the communication of any such power. But plaintiff relies on an alleged admission of Tucker to the contrary. A da;y or two before commencing this action plaintiff’s attorney called on Mr. Tucker, for the purpose of ascertaining “ whether "Mr. Thompson had authority to bind the Tuckers, or to sell and employ a broker.” Mr. Arthur 0. Tucker said, “ that Mr. Thompson was authorized to take any steps necessary to sell.” As broker employed to sell, Thompson, of course, had authority to take the steps necessary to that end. To have denied him such power would have been to render his agency frustrate. But, surely, authority to take the steps necessary to a sale, does not involve authority to employ another broker; for, if one broker, then why not a second and a third, and so on indefinitely, until the principal be crushed under the accumulated weight of countless commissions ?

But the person whom the attorney had the precaution to take with him as a corroborative witness, fails to sustain him, saying, that Tucker’s words were that Thompson “ had full authority to sell.” This is no more than a declaration that Thompson was a broker to sell. The learned trial judge in his charge misapprehended the effect of the testimony, when he told the jury that Tucker stated to the attorney “ that Thompson had full authority to employ brokers for the sale of the property.”

On a critical review of the case we see that, at most, the finding that the defendants authorized Thompson to retain the plaintiff, is sustained only by a scintilla of evidence, and this is ineffectual against a motion to nonsuit. Dwight v. Ins. Co., 103 N. Y. 341.

The respondent argues, however, that by consummating the sale which he negotiated, the appellents are estopped to question his authority, upon the ground that the enjoyment of the fruits of an agent’s act charges the principal with responsibility. The principle upon which the respondent relies is of recognized and salutary operation; but he misapprehends its import and application. The rule as propounded in a leading case of this state is, that “ when an agent, acting within the scope of his actual authority, perpetrates a fraud for the benefit of his principal, and the latter receives the fruits of it, he thereby adopts the fraudulent acts of his agent.” Smith v. Sweeny, 35 N. Y. 291; Mayer v. Dean, 115 id. 556. Here, the act of Thompson in substituting plaintiff as broker, if there wrere such substitution, was beyond the scope of Thompson’s authority; and the transaction, the enjoyment of the fruits of which is supposed to estop the appellants, was not the transaction of their agent but of a stranger. The rule was never applied, and in reason can never be applied, so as to validate a delegation of his agency by a broker; else the principal would be at the mercy of his broker, and might be burdened with, liability to as many deputies as the broker should choose to appoint. The law is settled otherwise. “ Where the subagent has been appointed without authority, and his acts are afterwards ratified, he can recover no compensation from the principal, but must look to the agent.” 1 Am. & Eng. Ency. of Law,' 395.

We conclude, therefore, that upon the uncontroverted evidence, the appellants are not responsible for the employment of the plaintiff, and are under no obligation to compensate him.

Our conviction that the respondent’s claim is without equity, reconciles us the more readily to the defeat of his judgment on legal grounds

Judgment reversed and new trial ordered, costs to abide the event.'

Bookstaver and Bischoff, JJ., concur.

Judgment reversed and new trial ordered.  