Agency authority and principal liability for employee fraud where payment to the collector remained valid against the firm.

Payment to an employee who had previously been authorised to collect money discharged the payer's liability where no notice or other circumstance showed revocation of that authority. On those facts, the payer was entitled to treat the employee as the defendant firm's agent for receipt of the amount. The principal remained liable for the employee's fraud committed in the course of the agency, even though the fraudulent act was for the employee's own benefit and was neither authorised nor approved by the principal. The payment was therefore valid against the defendant, and the loss fell on the defendant rather than the plaintiff.

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Issues: Whether payment made to the defendant's employee, who had previously been sent to collect money and whose authority had not been revoked, discharged the plaintiff's liability and made the defendant liable for the employee's fraud.

Analysis: The employee had been employed by the defendant firm for collection-related work, had earlier been sent with a letter to receive the money, and there was no notice or other circumstance showing revocation of his authority when the payment was later made. On these facts, the plaintiff was entitled to treat him as the defendant's agent for receiving the amount. The principal remains liable where an agent, acting within the scope of authority, commits fraud in the course of the agency, even if the act is for the agent's own benefit and not authorised or approved by the principal.

Conclusion: The payment to the employee was valid as against the defendant, and the defendant was liable for the loss caused by the employee's fraud. The appeal failed.

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