The case was submitted by the court to the jury, and a verdict was returned, in favor of defendant Congdon, and against the plaintiff, of no cause of action, upon which judgment was subsequently entered against the plaintiff for costs; and the plaintiff has brought the case here upon a writ of error.

The numerous assignments of error are discussed by appellant's counsel in his brief under the following subdivisions:

(1) Errors relating to the admission and rejection of testimony; (2) errors alleged in the trial court's refusal to direct a verdict for the plaintiff against defendant Herbert E. Congdon, and in refusing to give the requests proffered by the plaintiff, and in modifying these requests; (3) errors in the charge of the court.

1. We have examined with care the rulings of the court relating to the admission and rejection of testimony; and, in view of the scope of the testimony of defendant Congdon, drawn out upon the statutory cross-examination conducted by plaintiff's counsel, in which it appeared that the defendant Congdon had withdrawn from the firm about the 16th of April, and he having been interrogated as to the arrangement made by him for the payment of bills of the firm owed at that time, we are of opinion that this subject had been so far opened up by the plaintiff that no error was committed by the court in permitting the defendants to follow up that question and show in detail what had been done by said defendant in the way of the payment of the debts of the firm at the time he withdrew from it.

2. In view of the testimony of the plaintiff's witness Beattys as to his duty and custom of finding out the credit standing of customers, of learning what facts he could, and referring them to the credit department of the plaintiff, to which all such matters were referred, we do not think the court erred in refusing

to direct a verdict for the plaintiff, or in refusing plaintiff's requests to charge.

3. This brings us to the consideration of the important question in the case. The position of the plaintiff is that alleged communications to the salesman regarding matters of credit, or credit standing, or notice of an alleged withdrawal of a partner, will not bind the plaintiff unless such notice has been communicated to the plaintiff. Upon that subject the court charged the jury as follows, and error is assigned thereon:

"If you find that Mr. Kressler did notify the plaintiff's traveling salesman, Mr. Beattys, before any credit was extended to the Celery City Electric Company, that Mr. Congdon had withdrawn from the firm, then I instruct you that Mr. Congdon would not be liable in this action, regardless of whether or not Mr. Beattys communicated that fact to the plaintiff, for Mr. Congdon would not be liable by failure of the plaintiff's agent to perform his duty towards the plaintiff.'

Upon this point plaintiff's counsel relies upon the case of Neal v. M. E. Smith & Co., 116 Fed. 20, 54 C. C. A. 226. The opinion in that case was by Thayer, Circuit Judge. The statement of facts shows that there was testimony introduced at the trial which tended to show that on a given date the plaintiff's traveling salesman, by the name of Tracey, called at the place of business of the defendant and solicited the defendant Cushman to order some goods; that in the course of this interview Cushman said, among other things, that he had "bought Mr. Neal (the other partner) out now" and was "running on his own hook." The testimony to this effect was given by the defendant Neal, who claimed to have been standing by and to have overheard the conversation between Tracey and Cushman. The other defendant, Cushman, testified that at a given date he was in the city

of Omaha where the plaintiff company did business; that Tracey took him into the plaintiff's place of business and introduced him to the plaintiff's credit manager as, "Mr. Cushman, of Charter Oak, the whole cheese of the Charter Oak Mercantile Company." The goods, it appears, on account of which the suit was brought, were sold at various times subsequent to the first interview. The court said:

"The sole question which arises upon the record is whether this evidence necessitated the submission of the case to the jury to determine whether Smith & Co. had received notice, prior to the sale of the goods, of Neal's withdrawal from the firm. The defense which Neal made was that he retired from the firm in the month of March, 1898; that notice was given to all persons with whom that firm had previously dealt of his retirement; that such notice was given to the plaintiff company; and that the goods sued for were sold after his retirement from the firm. The lower court withdrew the case from the jury, holding that there was not sufficient evidence to warrant a finding that a notice of Neal's withdrawal from the firm had been given to the plaintiff company before the goods were sold. The witness Tracey denied that he ever informed plaintiff company of Neal's withdrawal from the firm, or that he was ever advised of that fact himself prior to the sale of the goods.

"Under these circumstances, the point to be determined is whether the notice given to Tracey, assuming that it was so given, or that a jury would have so found, was notice to the plaintiff company, since there is no substantial evidence that notice of the alleged withdrawal was otherwise communicated to it. The statement, if it was made, that Cushman was 'the whole cheese' cannot be accepted as a proper or sufficient notice of the dissolution of the firm. It might mean that or something else. And the question whether notice given to Tracey was adequate to bind the company depends, necessarily, upon the scope of his agency. The testimony on this latter point was to the following effect: That Tracey was simply a traveling salesman of the plaintiff company; that his

175 MICH.-87.

duties were to sell goods or solicit orders; that after taking an order it had to be submitted to his employer for its acceptance or rejection; and that he had no other duties than these, or authority to make arrangements binding upon the company.

"When a person retires from a firm with which he has been connected, it is his duty to advise all persons with whom the firm has previously had dealings that he has so withdrawn, if he would absolve himself from liability for credit subsequently extended by such persons to the firm from which he has retired. The law casts this burden on the retiring member; and, where the firm name remains unchanged, it does not compel those who have previously dealt with it to ascertain, each time that credit is extended, whether the membership thereof remains the same as before. In the absence of a notice to the contrary, they may assume that it does. This doctrine is elementary. * * * We are of opinion that the notice said to have been given by Cushman to Tracey was inadequate, and not binding upon the plaintiff, because Tracey's sole duty, as the evidence shows, was to take orders and submit them to his employer for acceptance or rejection, while he had not been armed with authority to extend credit or to determine to what extent customers were trustworthy; nor had it been made a part of his duty, so far as the record discloses, to ascertain who composed the firms with which his employer dealt, or to take note thereof, or to make report of changes therein. These duties, as it seems, had been devolved upon the credit department, and not upon the salesmen."

Conceding that this case states the correct rule, we think that it is easily distinguishable from the instant case. In this case we think it should be said that it appears undisputed that Mr. Congdon had retired from the firm before any credit was extended to the defendant company, and the plaintiff cannot be said to have had prior dealings with the company. We think that the language, which we have already quoted from the undisputed testimony of the witness Beattys, wherein he said, "My custom when selling goods, as to finding out the credit standing of the customer, is

to get what facts I can learn and refer them to the credit department of the Westinghouse Electric & Manufacturing Company, to which all such matters are referred," shows that if such information was given to him, the same was acquired by him in the course, and within the scope, of his agency. The doctrine seems well established by the authorities that the failure of an agent to communicate to his principal information acquired by him in the course and within the scope of his agency is a breach of duty to his principal, but as notice to the principal, it has the same effect as to third persons as though his duty had been faithfully performed. Cox v. Pearce, 112 N. Y. 637 (20 N. E. 566, 3 L. R. A. 563).

We think the weight of authority is to the effect that, where notice is given to an agent in the discharge of his duty, and within the scope of his agency, it must operate as notice to the principal. In such a case knowledge of the salesman is knowledge of the firm. Mechem on Agency, § 721; Straus, Gunst & Co. v. T. O. Sparrow & Co., 148 N. C. 309 (62 S. E. 308).

The principal is charged with all notice or knowledge, relating to the subject-matter of the agency, which the agent acquires or obtains while acting as such agent and within the scope of his authority. Jenkins Bros. Shoe Co. v. G. V. Renfrow & Co., 151 N. C. 323 (66 S. E. 212, 25 L. R. A. [N. S.] 231).

This subject is fully discussed in this case, and there is a lengthy citation of authorities, among others that of Goodspeed v. Plow Co., 45 Mich. 322 (7 N. W. 902). In that case Goodspeed, the defendant, as appears by the printed record, testified that on or about the date in question he informed one Woodford, the general agent of the plaintiff, who took the order for the goods, that he and Fales had dissolved their partnership, and he did not desire any goods shipped to Fales & Goodspeed on his account, and that such partnership was actually dissolved February 13, 1879.