Benton v. Roberts, (No. 16992.)

• Decision Date: 20 September 1926
• Docket Number: (No. 16992.)
• Citation: 35 Ga.App. 749,134 S.E. 846
• Parties: BENTON. v. ROBERTS.
• Court: Georgia Court of Appeals

35 Ga.App. 749

134 S.E. 846

BENTON.

v.ROBERTS.

(No. 16992.)

Court of Appeals of Georgia,

Division No. 2.

Sept. 20, 1926.

(Syllabus by Editorial Staff.)

Error from Superior Court, Jasper County; Jas. B. Park, Judge.

Suit by Irene Roberts against L. O. Benton. Judgment for plaintiff, and defendant brings error. Reversed.

Meriwether F. Adams, of Eatonton, and Wm. H. Key, of Monticello, for plaintiff in error.

A. Y. Clement, of Miami, Fla., and Doyle Campbell, of Tampa, Fla., for defendant in error.

Syllabus Opinion by the Court.

BELL, J. [1, 2] 1. While it is true that an agent for hire must exercise ordinary care generally about the business of his principal, it is also the rule that, if he exceeds or violates his instructions, and if his principal suffers damage as a consequence, the agent will be liable. Instructions must be followed, and, in a suit for damages by the principal against the agent for a breach of the contract of agency, where it is shown that the instructions were materially violated, it is unnecessary to allege in terms that the agent was negligent. Civil Code 1910, §§ 3576, 35S1; Cave v. Lougee & Zimmer, 134 Ga. 135, 67 S. E. 667; First National Bank of Waycross v. Dickerson, 24 Ga. App. 465, 101 S. E. 194; Render v. Hartford Fire Ins. Co., 33 Ga. App. 716 (4), 127 S. E. 902.

2. Where in such a case the petition alleges expressly or by implication that the defendant became the agent of the plaintiff for the purpose of lending the plaintiff's money only to good and solvent persons, upon good, sufficient, and solvent security, and to collect and faithfully account for the same, and that the agent violated the terms and conditions of his agency by lending the money to persons "who were then and there insolvent and are now insolvent, and without taking good, ample, and solvent security for said loan, " and where it is further shown that, as a result of such violation of the instructions so embodied in the contract of agency, the principal was damaged, the petition sets forth a cause of action. 1 Mechem on Agency, 939; Samonset v. Mesnager, 108 Cal. 354(1), 41 P. 337; Marshall v. Ferguson, 94 Mo. App. 175, 67 S. W. 935; Robinson Machine Works v. Vorse, 52 Iowa, 207, 2 N. W. 1108. (a) An amendment to such petition, alleging that the money was loaned upon a note to mature on January 22, 1921, and that the defendant refused to collect the note in compliance with his agreement, was not objectionable as setting forth a new and distinct cause of action, and the court did not err in allowing it.

3. Under the petition and the amendment thereto, the agreement, between the parties being oral, the plaintiff's cause of action would not have been barred by the statute of limitations until the lapse of four years from the time the defendant breached the agreement to collect, without an election by the plaintiff to accept an intermediate breach of the contract of agency. Nothing having been done by the plaintiff to mature the cause of action earlier, the suit was not barred, it being riled on January 13, 1925, within less than four years of the maturity of the note, Civil Code 1910, § 4389; Byrd Printing Co. v. Whitaker Paper Co., 135 Ga. 865 (3), 70 S. E. 798, Ann. Cas. 1912A, 182; Smith v. Ga. Banking Co., 113 Ga. 975 (1), 39 S. E. 410; 37 C. J. 813-815.

4. Neither the agent's promise to collect the loan as alleged in the petition nor the agreement, as a part of the contract of agency, to "guarantee" it, as shown in the plaintiff's evidence, constituted a promise to answer for the debt, default, or miscarriage of another, and the statute of frauds was not applicable either to the petition or to the evidence. Such undertaking on the part of the agent would merely relate to the terms and conditions of the agent's original obligations under the contract between him and the principal, at the execution of which no loan to another was in existence.

5. An agent to lend and collect money is not an insurer that the loan will be paid, in the absence of an express agreement on his part to that effect. 1 Mechem on Agency, 939; 2 C. J. 722; Simmons v. Martin, 54 Ga. 48. The allegations in the instant petition, which were as indicated above, did not show such special or express agreement on the part of the agent. While the court did not err in admitting testimony that the defendant agreed to "guarantee" the loan, over the sole objection that such agreement would be invalid under the statute of frauds, it was error, under the pleadings, to submit to the jury the question whether the defendant became a guarantor of the loan, and in effect to instruct them that, if so, the defendant would be liable, irrespective of whether the borrowers were insolvent at the making of the loan.

6. The defendant cannot claim that his agreement was without consideration, andthat for this reason he should be liable only for gross neglect. The act of the plaintiff in placing the money in his hands constituted a sufficient consideration for such promise as he made to her with respect to the terms upon...