Stewart and Another v Hugh McKean
| Jurisdiction | England & Wales |
| Judgment Date | 30 January 1855 |
| Date | 30 January 1855 |
| Court | Exchequer |
English Reports Citation: 156 E.R. 610
IN THE COURTS OF EXCHEQUER AND EXCHEQUER CHAMBER
S. C. 3 C. L R 460; 24 L. J. Ex. 145; 3 W. R. 216.
675] stewart and another v. hugh m'kean. Jan. 30, 1855.-The plaintiffs, bottle manufacturers in Scotland, in 1840, entered into negotiations with one W. M'EL for the employment of the latter as their agent at Leith for the sale of their bottles. On the 4th January, 1841, W. M'K. wiote to the plaintiffs, and offered to act as their agent upon certain terms, amongst which were the tallowing:-"First. All bottles to be sold at your risk, and all monies received for you to be duly accounted for by me and remitted to you from time to time. Fourthly. Security to be found for my intromissions to the amount ot 5001. sterling." W. M'K. was appointed by the plaintiffs to act as their agent, and they sent to him the following form of guarantee, which he transmitted to his brother, the defendant, and which was duly executed by the defendant.- "Gentlemen,-I hereby agree to guarantee my brother Mr. W. M'K.'s intromissions, as your agent in Leith, to the extent of 5001 sterling, and I urn, &c. H M'K. To Messrs. S. & Co (the plaintiffs) " The defendant never asked for ner leeeiverl any information as to the nature of his brother's, W M'K's., employment, nor was he aware of the times and manner in which his brother was to account to the plaintiffs The word "intromission " is a term partly legal and partly mercantile, and signifies dealings with stock, goods, and cash of a principal coming into the hands of his agent, and to be accounted for by the agent to hia principal Soon after the commencement of the agency, it was agreed between the plaintiff's and W. M'K. that the latter should furnish to the plaintiffs every six months an account current of the stock sent by them, and of cash received by him from customers This practice continued for about a year aad a half, when an agreement was entered into between the plaintiffs and W. M'K., but without the defendant's knowledge or consent, that W M'K. should, from time to time, make his promissoiy notes payable four months after date in favour of the plaintiffs, and that he should send them to the plaintiffs at the rate of about one note per month , and that, on the notes becoming due, W. M'K. should transmit to the plaintiffs an account of all the debts or sums he had collected from their customers , and that the plaintiffs should send him such an amount of cash as would, when added to the money already in his hands, enable him to take up the notes. This agreement was immediately acted upon, and was eontrnued to be acted upon by the plaintiffs and W. M'K. until the termination of his employment as their agent. The notes were made on accourrt of the plaintiffs without reference either to the amount of the stock received by W. M'K. for sale, or to the amount of sales made by him, or to the outstanding debts, or to the proceeds of sales or sums collected by him from the customers and remaining in his hands ; and it sometimes happened, that notes were made by him exceeding by many hundreds of pounds the value of the stock received, of the outstanding debts, and of the proceeds or sums collected by him. These notes on being transmitted to the plaintiffs were indorsed by them to their bankers who gave them a cash credit thereon, and the same were always duly 10EZ^676. STEWART V. M'KEAN 611 honoured on arriving at maturity This, however, was all done without the knowledge or consent of the defendant. One of the motives of the plaintiffs in requiring W. M'K. to make the notes in their favour, was to increase their own credit and to furnish them with funds for the payment of the duties; but another motive and the practical effect of the arrangement was to cause W M'K. to pay over the monies collected by him more promptly to the plaintiffs than he would otherwise have done. In May, 1850, W M'K ceased to be in the employment of the plaintiffs, and at that time had received certain monies for the plaintiffs for which he did not and was not able to account -In an action upon the above guarantee, Held per Parke, B., Alclerson, B , and Martin, B , that, inasmuch as the guarantee left the mode of accounting open to the will of the employers, provided they adopted a leasonable one, the agreement between the plaintiffs and their agent W. M'K., as to the mode of accounting by means of promissoiy notes, as above mentioned, did not discharge the surety from his liability upon the guarantee-Pollock, C. B, dissentiente [S. C. .3 C. L R 460; 24 L. J. Ex. 145; 3 W. E. 216.] The declaration stated, that the plaintiffs, being bottle manufacturers at Alloa, in Scotland, and being about to employ an agent at Leith, the defendant, in consideration [676] that they would employ his brother, William M'Kean, as such agent, to receive and sell bottles for the plaintiffs, and to collect and pay over the pioceeds of such sales to the plaintiffs, agreed to guarantee the payment to the plaintiffs of all such monies as William M'Kean should receive as such agent, to the extent of 5001. Aveiments that the plaintiffs from thence until May, 1850, employed William M'Kean as such agent; and that, during such agency, he received on account of the plaintiffs monies which he refused to pay over, and at the expiration of such employment, there was, and still is, due to the plaintiff's, 3701. The defendant pleaded (inter alia) the Statute of Limitations, and also a plea setting out the agreement hereinafter mentioned, between the pl.iintiffs and William M'Kean, that the latter should, on account of the sums collected, make promissory notes payable four months after date to the plaintiffs' order, and alleging, that, in pursuance of the agreement, William M'Kean made three such promissory notes for the respective sums of 2341. 13s., 2G51. 10s, and 1721 5s. 6d., and that time was thereby given to William M'Kean without the defendant's consent Issue having been joined on the pleas, a verdict waa found, by consent, for the plaintiffs, subject to the award of an arbitrator, by whom the following case was stated for the opinion of this Court - The plaintiffs, in the year lcS41, were, and still are, bottle manufacturers at Alloa, in Scotland, and the defendant in the same year, was and still is, an agent for an insurance office, resident in London. In Decembei, 1840, negotiations having been entered into between the plaintiffs and William M'Kean, the brother of the defendant, for the employment of William M'Kean as the plaintiffs' agent at Leith for the sale of their bottles, the following letter was written by William M'Kean to the plaintiffs - "Leith, 4th January, 1841. "Deal Siis,-I was only this morning favoured with [677] yours of the 31st of December, and now make you the following offer to act as agent for the Alloa G-Iass Works in this quarter and neighbourhood "First. All bottles to be sold at your risk, and all monies received foi them to be duly accounted for by me and remitted to you from time to time, my being careful as to the credit of the parties to whom they are sold. "Second. Regular books and accounts to be kept by me for your business, and these to be always patent for your inspection Account sales to be rendered at the end of each month or when required, also list of outstanding debts and account current every three weeks. "Third My commission to be 2\ per cent on all monies received , and all charges such as porteiage, freight, &c , to be paid by you. "Fourth. Security to be found for my intiomissions to the extent of 5001. sterling. I shall be obliged by your giving me a copy of the letter of security required, and my 612 stewart v. m'kean 10 ex 678. brother, Hugh M'Kean, agent for the Scottish Widows' Fund and Life Assurance Company, London, will sign it.-Yours very respectfully, "W.B. M'KEAN." William M'Kean was thereupon appointed agent to the plaintiffs, and shoitly afterwards received from Mr. Sandford, one of the plaintiffs, the following letter written by him. "Eandolph Crescent, 6th January, 1841. "Dear Sir,-Annexed you will find the form of a letter of guarantee to be written out and signed by your brother, which I send you at Mr. Stewart's request If you think the sum too large, you might fill it up at any amount you wish It is more a matter of form than anything else , but as we require a guarantee from all our agents, it is proper that it should be given even when unnecessary -Yours, &c , "E. D. sandford." The form of the letter of guarantee referred to in the above letter, and annexed to it, was as follows :- [678] "London, llth January, 1841. " Gentlemen,-I hereby agree to guarantee my brother Mr. W. M'Kean's intro missions as your agent in Leith, to the extent of five hundred pounds sterling -And I am, Gentlemen, your obedient Servant, " H. M'KEAN. "To Messrs. Stewait & Co , " Bottle Manufacturers, Glass Works, Alloa " William M'Kean forthwith transmitted to his brother, the defendant, the above letter of the 6th of January, 1841, together with the form of guarantee annexed thereto; and shortly afterwards received back from the defendant the form of guarantee duly executed by the defendant, and handed it over to the pl.iintiffs The letter above set forth, of the 4th of January, was not communicated to the defendant. The defendant never asked for, nor received, either from the plaintiffs or William M'Kean, or from any other quarter, any other information as to the nature of the employment of William M'Kean, or as to his own liability on the guarantee, than was conveyed by the letter of the 6th of January and the accompanying form of guarantee. He was not aware of the time and manner in which William M'Kean was to account to the plaintiffs. The word " intromission" is a term partly legal, partly mercantile, and signifies dealings with stock, goods, and cash of a principal coming into the hands of an agent...
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