When agent acts for the agent, reason for O.C.G.A.

§ 10-6-58 ceases. - When the agent departs from the scope of the agency and begins to act for the agent and not for the principal, when the agent's private interest is allowed to outweigh the agent's duty as a representative, and when to communicate the information would prevent the accomplishment of the agent's fraudulent scheme, the agent becomes an opposite party, not an agent. The reason for the rule enunciated in former Code 1933, § 4-309 then ceases. Pursley v. Stahley, 122 Ga. 362, 50 S.E. 139 (1905).

Former Code 1933, § 4-309 was modified when an agent proves false to the agent's principal. Hartford Accident & Indem. Co. v. Hartley, 275 F. Supp. 610 (M.D. Ga. 1967), aff'd, 389 F.2d 91 (5th Cir. 1968).

When agent is false.

- Rule enunciated in former Civil Code 1910, § 3599 was modified when an agent proves false to the agent's principal and at the instance of a third party aids in the communication of false reports as to the insurability of an applicant for the purpose of benefiting the applicant and of defrauding the agent's principal. Loftin v. Great S. Home Benevolent Ass'n, 9 Ga. App. 121, 70 S.E. 353 (1911).

Rule of former Civil Code 1910, § 3599 did not apply when an agent conspired with the other party. In such a case the principal was not bound thereby nor charged with knowledge of the facts thus acquired by the agent. Terry v. International Cotton Co., 138 Ga. 656, 75 S.E. 1044 (1912).

When notice to agent will not be imputed to principal.

- Notice to the agent will not be imputed to the principal: (1) when it is such as it is the agent's duty not to disclose; (2) when the agent's relations to the subject matter, or the agent's previous conduct, render it uncertain that the agent will not disclose it; and (3) when the person claiming the benefit of the notice, or those whom the agent represents, colluded with the agent to cheat or defraud the principal. Faircloth v. Taylor, 147 Ga. 787, 95 S.E. 689 (1918).

A could read and write, but was inexperienced in business. B had been A's attorney, and A owed B $50. At B's request, and to enable B to raise the money, A agreed to give a note therefor. The agent fraudulently made a note for $500, instead of $50, and procured A to sign it. The note was made payable to X, who had money to lend and who was a client of B. The money was advanced on the note to B, but none was paid over by X to A. It was held that the lender was not charged with notice of the agent's fraud. Pursley v. Stahley, 122 Ga. 362, 50 S.E. 139 (1905).

Notice to the agent will not be imputed to the principal when the person claiming the benefit of the notice colluded with the agent to cheat or defraud the principal. Boles v. Hartsfield Co., 50 Ga. App. 442, 178 S.E. 416 (1935).

When an agent ceases to act for the agent's principal and begins to act in the agent's own best interest or conspire with another to the detriment of the agent's principal, the agent's knowledge is no longer imputed to the agent's principal. Hartford Accident & Indem. Co. v. Hartley, 275 F. Supp. 610 (M.D. Ga. 1967), aff'd, 389 F.2d 91 (5th Cir. 1968).

Conspiracy with agent not proved.

- Defense set up by the defendant insurer, that the plaintiff conspired with the agent of the insurance company to obtain the policies, was not supported by any evidence. Guaranty Life Ins. Co. v. Brown, 92 Ga. App. 847, 90 S.E.2d 97 (1955).

Cited in Henderson v. Citizens First Nat'l Bank, 151 Ga. 62, 106 S.E. 549 (1921); First Nat'l Bank v. Cooper, 252 Ga. 215, 312 S.E.2d 607 (1984).

Am. Jur. 2d.

- 3 Am. Jur. 2d, Agency, § 302 et seq.

C.J.S.

- 2A C.J.S., Agency, § 481 et seq.

ALR.

- Imputation of attorney's knowledge of facts to his client, 4 A.L.R. 1592; 38 A.L.R. 820.

Personal liability of servant or agent to third person for injuries caused by the performance or nonperformance of his duties to his employer, 20 A.L.R. 97; 99 A.L.R. 408; 96 A.L.R.2d 208.

Notice to salesman as chargeable to principal, 43 A.L.R. 745.

Imputing to principal knowledge of agent having adverse interest or acting antagonistically to principal, 104 A.L.R. 1246.

Agent's knowledge of his own embezzlement or other misconduct as imputable to principal in latter's suit on fidelity bond or insurance, 105 A.L.R. 535.

Personal liability of auctioneer to owner or mortgagee for conversion, 96 A.L.R.2d 208.

Imputation of knowledge of agent acting for both parties to transaction, 4 A.L.R.3d 224.