O.C.G.A. § 10-6-87 (2019)

Annotations

JUDICIAL DECISIONS ANALYSIS GENERAL CONSIDERATION PROOF OF AGENCY QUESTIONS OF FACT JURY INSTRUCTIONS General Consideration Liability of agent if agency not disclosed. - It is only when an agent is either expressly or impliedly dealing or acting for and in behalf of the agent’s principal that a contract made by the agent with a third person having knowledge of this relationship is the contract of the principal and is not the personal contract of the agent. Harris v. Southeastern Printers Supply Co., 59 Ga. App. 729, 2 S.E.2d 184, 1939 Ga. App. LEXIS 398 (1939). When the plaintiff, through a member of the firm, made an oral agreement with the defendant to install and repair a printing press on what is designated as “a time and material basis,” and the defendant did not at any time during the negotiations for the contract or during the progress of the work disclose to the plaintiff’s agent that the defendant was the agent of anyone or that the agent was contracting for the services, or that the agent accepted the services, as the agent for another, and, notwithstanding the fact that the plaintiff may have known beforehand that the defendant was “connected with” or was an officer in or agent for a corporation which was the owner of the printing press which was being repaired under the contract, the inference is authorized that the contract was with the defendant in the defendant’s individual capacity. Harris v. Southeastern Printers Supply Co., 59 Ga. App. 729, 2 S.E.2d 184, 1939 Ga. App. LEXIS 398 (1939). Agent who makes a contract without disclosing that the agent is acting as an agent or without identifying the agent’s principal will become individually liable on the contract. Chambliss v. Hall, 113 Ga.

App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966). Only principal is bound if agent names principal. - Under former Code 1868, §§ 2169 and 2185, it was a general rule - standing on strong foundations, and pervading every system of jurisprudence - that when an agent was duly constituted, and named the agent’s principal, and contracts in the agent’s name, the principal was responsible, and not the agent. Tiller v. Spradley, 39 Ga. 35, 1869 Ga. LEXIS 168 (1869); Gibbs v. Carolina Portland Cement Co., 50 Ga. App. 229, 177 S.E. 760, 1934 Ga. App. LEXIS 714 (1934). When an agent in making a contract discloses to the other contracting party that the agent is acting for a named principal, the principal is responsible and not the agent. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966); Evans v. Smithdeal, 143 Ga. App. 287, 238 S.E.2d 278, 1977 Ga. App. LEXIS 2290 (1977). When the owner of land employs a general agent to manage and operate the owner’s farm, such agency being fully disclosed to the persons contracting with the agent to cultivate the land as croppers, no liability arises in favor of persons cultivating the land, as against the agent, by reason of the operation of the farm, and even though the agent may have authority from the agent’s employer to make all contracts with croppers, superintend the operations of the farm, sell the products of the farm, and make all settlements with the croppers and tenants thereon, and may actually perform such duties, with the consent of a cropper on the premises, the agent’s possession of crops grown on the premises is as agent for the agent’s

General Consideration (Cont’d) employer, and not in the agent’s own right, and the agent is not subject to the process of garnishment instituted by a creditor of such cropper. Johnson v. Varnum, 43 Ga. App. 737, 159 S.E. 908, 1931 Ga. App. LEXIS 533 (1931). Principal liable if other party knew of agency. - If the sheriff knew that the bidder purchased as the agent of others, and recognized and treated the bidder as such, the sheriff’s right of action would not be against the agent but against the principal. Cureton v. Wright, 73 Ga. 8, 1884 Ga. LEXIS 3 (1884). A person who has obtained a diversion of a shipment of goods during transportation by a carrier is not liable for a resulting additional freight charge when, in ordering the diversion, the person was acting as agent for another and the carrier must have known of this fact. B & O R.R. v. Johnson-Battle Lumber Co., 37 Ga. App. 729, 141 S.E. 678, 1928 Ga. App. LEXIS 585 (1928). Agent has duty to disclose principal to avoid liability. - If the agent would avoid personal liability, the duty is on the agent to disclose the agent’s principal, and the agent is individually liable if the agent fails to disclose the agent’s agency and the identity of the agent’s principal. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966). When an agent wishes to avoid personal liability, the duty is on the agent to disclose the agent’s agency, and not on the party with whom the agent deals to discover it. Brown-Wright Hotel Supply Corp. v. Bagen, 112 Ga. App. 300, 145 S.E.2d 294, 1965 Ga. App. LEXIS 678 (1965); Whitlock v. PKW Supply Co., 154 Ga. App. 573, 269 S.E.2d 36, 1980 Ga. App. LEXIS 2291 (1980). Agent has burden of proving agency and other party’s knowledge thereof. - If a person would relieve themselves from personal liability on the ground of agency, the person ordinarily has the burden of proving the fact of agency as well as knowledge thereof by the opposite party. Citizens Nat’l Bank v. Jennings, 35 Ga. App. 553, 134 S.E. 114,

1926 Ga. App. LEXIS 976 (1926); B & O R.R. v. Johnson-Battle Lumber Co., 37 Ga. App. 729, 141 S.E. 678, 1928 Ga. App. LEXIS 585 (1928). To relieve oneself of personal liability the agent ordinarily has the burden of proving by direct or circumstantial evidence the fact of agency as well as knowledge thereof by the opposite party. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966); Yarbrough & Co. v. Travis Pruitt & Assocs., 130 Ga. App. 49, 202 S.E.2d 227, 1973 Ga. App. LEXIS 1219 (1973). Use of a tradename is not necessarily a sufficient disclosure of the identity of the principal and the fact of agency so as to protect the agent against personal liability. Brown-Wright Hotel Supply Corp. v. Bagen, 112 Ga. App. 300, 145 S.E.2d 294, 1965 Ga. App. LEXIS 678 (1965). Agent may expressly or impliedly bind himself. - An agent who makes a contract with the express or implied understanding with the other party that the agent is binding oneself individually will become individually liable on the contract. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966). Personal liability of agent in addition to principal’s liability. - If an agent acts for a disclosed principal, within the scope of the agent’s authority, the actions are those of the principal, who is alone liable unless the agent has assumed personal liability also. Candler v. Clover Realty Co., 125 Ga. App. 278, 187 S.E.2d 318, 1972 Ga. App. LEXIS 1298 (1972). When agency is known. - When the agency is known but the credit is expressly given to the agent, the agent is personally responsible. Verhey v. Cook, 142 Ga. App. 280, 235 S.E.2d 678, 1977 Ga. App. LEXIS 1576 (1977). Agent may expressly contract on the agent’s own credit and be bound, even though the agent’s principal is known. Brown & Huseby, Inc. v. Chrietzberg, 242 Ga. 232, 248 S.E.2d 631, 1978 Ga. LEXIS 1153 (1978). Recording agency contract held not to give notice or relieve agent. - In an action by a seller on an open account for

goods sold against a defendant who alleges the defendant was acting as an agent, recording of the agency contract in the office of the clerk of the superior court was held not to give proper notice of the agency contract to the seller, and when the seller had no actual knowledge of the contents of the agency contract, the defendant agent is personally liable. Babb v. Kersh, 92 Ga. App. 346, 88 S.E.2d 432, 1955 Ga. App. LEXIS 589 (1955). Applicability in attorney-client relationship. - Attorney could not be held solely liable to a court reporting service for $851.10, representing court reporting fees owed, as the clients the attorney was representing at the time the services were rendered should have been joined in the litigation, pursuant to both O.C.G.A. §§ 9-11-14(a) and 9-11-19(a), given that: (1) the clients could have been liable to the attorney for all or part of the court reporting fees; and (2) the attorney’s claim that the clients made partial payment for the court reporting services also rendered the clients necessary parties for adjudication of this dispute. Free v. Lankford & Assocs., Inc., 284 Ga. App. 328, 643 S.E.2d 771, 2007 Ga. App. LEXIS 236 (2007), cert. denied, No. S07C1114, 2007 Ga. LEXIS 560 (Ga. July 12, 2007). Proof of Agency Agency may be proved by contract or extrinsic evidence. - Contract signed by a person who adds after the person’s signature the words “general manager” is not the individual undertaking of the person signing, if the contract shows on its face that it was made in behalf of another, or if, in an action for its breach, this fact appears by extrinsic evidence. Raleigh & Gaston R.R. v. Pullman Co., 122 Ga. 700, 50 S.E. 1008, 1905 Ga. LEXIS 304 (1905). If it does not appear from the face of the contract whether it is the signer’s individual undertaking or is that of the signer’s principal acting through the signer as the principal’s agent, it may, especially when the contract is not executed under seal, be shown extrinsically that the contract is that of the principal, executed for and in the principal’s behalf by the prin-

cipal’s agent. Dorsey v. Rankin, 43 Ga. App. 12, 157 S.E. 876, 1931 Ga. App. LEXIS 161 (1931). Parol evidence. - Under former Civil Code 1895, §§ 3022 and 3039, when a contract was signed by a person individually, parol evidence was admissible for the purpose of showing that the person was acting as agent for another. Fitzgerald Cotton Oil Co. v. Farmers Supply Co., 3 Ga. App. 212, 59 S.E. 713, 1907 Ga. App. LEXIS 598 (1907). Proof when actual principal is not one indicated after agent’s signature. - When the question as to who is the real contracting party is one of fact which can be extrinsically determined, it may be shown that the person signing a contract in the person’s own name, with descriptive terms of agency after the person’s signature, did so for and on behalf of another as the person’s principal, by and through the person as agent, although the person’s principal may be another and different person from the one indicated as the signer’s principal in the descriptive terms attached to the signer’s signature. Dorsey v. Rankin, 43 Ga. App. 12, 157 S.E. 876, 1931 Ga. App. LEXIS 161 (1931). Contract reciting it was not signed on another’s behalf. - When a contract recites that it represents the entire agreement between the parties, it cannot be shown by extrinsic parol evidence that one of the signatories did not sign, as recited therein, on the signatory’s own behalf, but signed as an agent of another. Haas v. Koskey, 138 Ga. App. 448, 226 S.E.2d 279, 1976 Ga. App. LEXIS 2188 (1976). Introduction of extrinsic evidence when fact of agency not in contract. - If the fact of agency does not appear in an integrated contract, an agent who appears to be a party thereto cannot introduce extrinsic evidence to show that the agent is not a party except: (a) for the purpose of reforming the contract; or (b) to establish that the agent’s name was signed as the business name of the principal and that it was so agreed by the parties. Haas v. Koskey, 138 Ga. App. 448, 226 S.E.2d 279, 1976 Ga. App. LEXIS 2188 (1976). “Agent for” after signature does not alone bind principal. - Expression “agent for” a designated person, following

Proof of Agency (Cont’d) the name in a signature attached to a contract, is merely descriptio personae, and its presence in the signature does not of itself necessarily render the contract the undertaking of the designated principal, acting by and through the signer as the principal’s agent. Dorsey v. Rankin, 43 Ga. App. 12, 157 S.E. 876, 1931 Ga. App. LEXIS 161 (1931). Use of trade name does not necessarily relieve agent. - Use of a trade name is not necessarily a sufficient disclosure of the identity of the principal and the fact of agency so as to protect the agent against personal liability. Whitlock v. PKW Supply Co., 154 Ga. App. 573, 269 S.E.2d 36, 1980 Ga. App. LEXIS 2291 (1980). Employer was not representing the disclosed principal when the employer hired an employee, the employer contracted with the employee personally and not as an agent, and the language of a letter of understanding supported the position that the employer was acting individually in asking the employee to work for the corporation. Wojcik v. Lewis, 204 Ga. App. 301, 419 S.E.2d 135, 1992 Ga. App. LEXIS 848 (1992). Questions of Fact Disclosure or knowledge of agency is question of fact. - Whether or not the fact of the agency and the identity of the principal were disclosed or known to the other contracting party is a question of fact which may be shown by direct or circumstantial evidence. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966). Trier of fact should determine whether the agency was disclosed. Yarbrough & Co. v. Travis Pruitt & Assocs., 130 Ga. App. 49, 202 S.E.2d 227, 1973 Ga. App. LEXIS 1219 (1973). Parties’ intention as to who will be bound. - Intention of the parties as to who will be bound when the principal is disclosed is usually a question of fact for a jury. Whitlock v. PKW Supply Co., 154 Ga. App. 573, 269 S.E.2d 36, 1980 Ga. App. LEXIS 2291 (1980). Question whether the plaintiff received certain foreign bills of exchange drawn by

the defendants, payable to the plaintiff’s order, from the defendants on their credit as the drawers thereof or on the credit of the proceeds of the plaintiff’s own cotton shipped and sold by the defendants as the plaintiff’s agents was a question to be decided by the jury under the evidence in the case. Jones v. J.W. Lathrop & Co., 44 Ga. 398, 1871 Ga. LEXIS 393 (1871). Contract may, depending upon the facts and circumstances, be impliedly one with the agent in the agent’s individual capacity. What was the understanding of both parties is a question of fact to be decided by the jury under the circumstances of each case. Chambliss v. Hall, 113 Ga. App. 96, 147 S.E.2d 334, 1966 Ga. App. LEXIS 982 (1966); Evans v. Smithdeal, 143 Ga. App. 287, 238 S.E.2d 278, 1977 Ga. App. LEXIS 2290 (1977). Negotiable instruments after negotiation. - This section does not control when a negotiable paper, complete on its face, appears to have been negotiated in the fair and usual course of trade; nor, on such a paper as this, is the question to whom credit was given one of fact to be decided by the jury. Bedell v. Scarlett, 75 Ga. 56, 1885 Ga. LEXIS 69 (1885). Sealed instruments or agreements to be individually bound. - Omitting cases of contracts under seal, negotiable instruments, and those when there is an express declaration in writing of an intention and agreement on the part of an agent to be individually bound, usually when the agent contracts in the agent’s own name, but with the agent’s principal known, the question as to whether the principal or the agent individually is bound is one of fact. Phinizy v. Bush, 129 Ga. 479, 59 S.E. 259, 1907 Ga. LEXIS 491 (1907). Allegations not raising issue of who is bound. - When the plaintiff’s pleading showed on its face that the agency of the president was known and that credit was extended to the principal, and there being no allegation that credit was expressly extended to the agent, there was no issue which required submission to the jury. Bank of Univ. v. Hamilton, 78 Ga. 312, 1886 Ga. LEXIS 237 (1886). When agency was shown, there was no issue which required submission to the

jury in the absence of allegations that credit was expressly extended to the agent, or that the authority assumed by the agents was unauthorized. Ross v. Grinalds, 86 Ga. App. 180, 71 S.E.2d 294, 1952 Ga. App. LEXIS 909 (1952). Jury Instructions Instruction on section should use “expressly” or refer to parties’ understanding. - In charging this section, the court neither used the word “expressly” nor any equivalent language, nor did the court refer in clear terms to the understanding of both parties. The amplification which was requested orally would have supplied the omission and ought to have been incorporated into the

charge. Fleming v. Hill, 62 Ga. 751, 1879 Ga. LEXIS 613 (1879). Instruction substantially giving benefit of section. - Failure to charge this section without request was not error when accommodation endorsers in an action on a renewal note were given substantially the benefit of this contention in a charge to the jury that, should the jury find from the evidence that the endorsers signed the note sued on as officers of a corporation and not as individuals, they should find in favor of them, even though no such representative capacity appears on the face of the note. Franklin v. Sea Island Bank, 111 Ga. App. 182, 141 S.E.2d 121, 1965 Ga. App. LEXIS 913 (1965).

RESEARCH REFERENCES Am. Jur. 2d. 3 Am. Jur. 2d, Agency, § 213 et seq. C.J.S. 3 C.J.S., Agency, § 557 et seq. ALR. 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. Personal liability of auctioneer to owner or mortgagee for conversion, 96 A.L.R.2d 208. Attorney’s personal liability for expenses incurred in relation to services for client, 66 A.L.R.4th 256.