business, namely, the indorsement for deposit of checks made payable to the principal where such were collected. (Civ. Code, sec. 2319, subd. 1.) The case of Dispatch Printing Co. v. National Bank of Commerce, 109 Minn. 440, [50 L. R. A. (N. S.) 74, 124 N. W. 236], cited by appellant, is somewhat similar in its facts, but differs in the essential particular that in that case the agent was expressly directed by the principal not to indorse or deposit checks payable to them, but to remit them direct to the principal.

The evidence amply justified the finding of the trial court that the agent was authorized to make the indorsements made by him for the deposit of the checks to his account, including the checks in question.

The judgment is affirmed.

Lennon, J., Olney, J., Shaw, J., Lawlor, J., and Angellotti, C. J., concurred.

MELVIN, J., dissenting.-I dissent.

While there might be some force in a contention that after the discovery of the conversion of some of the rents by Clement, the plaintiff by retaining him as agent would be estopped to object to the method by which he obtained the money, I cannot bring myself to approve of the doctrine announced by the majority of the court that when a principal employs an agent to collect and transmit rentals he thereby clothes such agent with authority to indorse checks. Some of the statements in the prevailing opinion are so extraordinary that with all due respect to the learned author I must unwillingly review them and dissent from them. For example, this language is used: "The appellant on receiving from month to month the personal check of its agent in satisfaction of rentals collected, must have been aware of the fact that Clement was depositing all rents in his own personal account, and thus by implication must have approved such deposit. The conclusion cannot be escaped in this case that the authority of the agent included the power to deposit money or paper collected to his own account." Of course the principal supposed that Clement was depositing rents to his own credit, as he was transmitting the money by personal check. That had been the usual course of business; but how did such a supposition bind the principal to the further and extraordinary implica

tion that the collector was clothed with the high authority to indorse his principal's name? There were three ordinary methods by which the tenant might pay the agent. These were, (1) by actual cash; (2) by check payable to the agent's order, and (3) by check payable to the landlord's order. If by either of the first two methods Clement had collected the money, undoubtedly he might have deposited the cash or the check to his own account, and any subsequent conversion of the funds would have caused loss to his principal. If by the third method the tenant had paid, under the terms of Clement's agency as a collector, he could honestly do but one thing. He could transmit the check itself to the payee. When he indorsed the first check he was guilty of a conversion, not of money, but of his principal's check. If he had left the country the next day can anyone question the fact that the Arcade Realty Company could have compelled the tenant to pay the rent? Or could anyone doubt that the bank which without any inquiry or investigation had recognized Clement's authority to indorse for the payee, could be compelled to reimburse its depositor Phillips? How then did. a persistence in wrongdoing sanctify Clement's acts into those of an agent clothed with the power to do those very acts? It is true that much of the money thus obtained was paid to the Arcade Realty Company, but such acts of restitution did not excuse the bank for its astounding lack of ordinary prudence. If the officers of the bank had made the slightest inquiry the plaintiff would have been warned, of course, that its collector was assuming the right to indorse cheeks made payable to its order.

Continuing the argument, the opinion contains the following language: "But when the principal permitted its agent to deposit the collections to his personal account, to be transmitted by his personal check, it is a fair if not in fact a necessary inference that he had the authority to make such indorsements as were necessary to do this." I fail to follow this reasoning. Because the principal permitted his agent to collect money and to transmit it, by no means does it follow that the agency went to the extent of allowing him to accept and to convert something else.

"Rents in large amounts are not habitually paid in money, but by check," says the learned author of the opinion. Undoubtedly that is true, but the next two sentences in my

opinion declare an absolute non sequitur. They are as follows: "The principal could hardly have assumed that such paper was all drawn to the order of the agent. The tenants would not naturally so draw their checks, but to the order of the landlord." Why couldn't the principal assume that the checks, if any, were all drawn to the order of the agent? The agent had authority to collect. Why should the principal think that the tenants would not take the convenient method of paying him directly in money or checks? In my opinion the power to indorse was no more involved in the power to collect than would have been an authorization to use a club in compelling Phillips to pay if Clement had employed that method of persuasion. Why would the tenants naturally draw their checks to the order of the landlord? There is no law of statutory origin or of commercial usage which justifies such reasoning. I venture to assert that a large proportion of the rentals of business and residence property in large cities is paid directly to real estate agents and not to owners of the realty.

Continuing, the learned author of the opinion uses the following language: "The appellant receiving all its rentals by the agent's personal check cannot claim that it did not know that its tenants were paying by checks to its order. It should have presumed that they were doing so in some instances at least, and this being so the appellant should have known that the agent was indorsing such checks for deposit." Why should a principal be bound to assume that a trusted agent was going outside of his agency? I cannot, although I have tried, see the force of such reasoning. Again I assert that there is no such rule of law or commercial usage. Does the average tenant of an apartment house know the name of his landlord? I venture to say he does not. And even if he does, he deals entirely with the agent. True, Phillips knew who his landlord was, but he also knew that the Arcade Realty Company had empowered Clement to collect, and the landlord having given him that notice was thoroughly justified, it seems to me, in assuming that the payments were being made to the agent either in money or in checks which the latter might honestly indorse.

If Phillips, either because he did not trust Clement or for any other reason, chose to pay directly by check drawn in the landlord's favor, he was entitled to the protection afforded

by the fact that his banker was bound to pay only the payee or an authorized agent, and it is to be remembered that plaintiff herein has succeeded to Phillips' rights. If the bank had done its duty Clement could never have been in a position to convert the checks and thereby injure either Phillips or the Realty Company. Concededly, if Clement had been getting the moneys in an authorized way he could have converted them more easily. But this does not prove that he was authorized to indorse the corporation's name. We are dealing with a matter of implied agency, and I solemnly believe the rule announced in the prevailing opinion is illogical and will be productive of much harm. It will gladden the hearts of careless bankers and make them think that they are no longer held to a high degree of care in protecting their depositors from spoliation.

In the prevailing opinion the majority of the justices approve the test for ascertaining an agent's authority to indorse negotiable paper as set forth in Jackson Paper Mfg. Co. v. Commercial Nat. Bank, 199 Ill. 151–156, [93 Am. St. Rep. 113, 59 L. R. A. 657, 65 N. E. 136], in which Mr. Chief Justice Magruder used the following language: "The weight of anthority seems to be in favor of the contention of appellant, that authority to indorse commercial paper can only be implied, where the agent is unable to perform the duties of his agency without the exercise of such authority. In other words, the power of an agent to indorse commercial paper for his principal must be a necessary implication from an express authority conferred upon such agent." Applying this test to the case at bar it seems to me that power of indorsement was not a necessary implication from the agency. All Clement needed to do, under the terms of his agency, was to mail each check of this sort, or carry it, or send it by messenger, to his principal.

[L. A. No. 4953. Department Two.-May 7, 1919.]

MARY W. KELLNER, Appellant, v. THE TRAVELERS INSURANCE COMPANY OF HARTFORD, CONNECTICUT (a Corporation), Respondent.

[1] ACCIDENT INSURANCE

RECOVERY FOR DEATH

NONRESPONSIBILITY

FOR INJURIES RESULTING FROM DISEASE PROVISION OF POLICY. INSTRUCTION.-In an action to recover for the death of the husband of the plaintiff under a policy of accident insurance providing that the insurance shall not cover injuries, fatal or nonfatal, resulting wholly or partly from disease in any form, an instruction offered by the plaintiff was properly refused, which if given, would have informed the jurors that if they believed the fall sustained by the insured was the "sole and only direct cause” of death they must find for the plaintiff, notwithstanding a further belief that in previous years deceased may have had a reducible hernia, provided that they should further find that deceased would not have died, at the time, under the circumstances, and in the manner he did die, had it not been for said accident and fall.

[2] ID. DEATH FROM DISEASE AND ACCIDENT-INSTRUCTION.-In such action, the court correctly instructed the jury that there could be no recovery under the policy for death caused partly by disease and partly by accidental injury.

[3] ID.-EVIDENCE-ACCIDENTAL INJURY PRE-EXISTING DISEASES CAUSE OF DEATH-RIGHT TO RECOVER-INSTRUCTION.-In such action, an instruction that if the plaintiff has established by a preponderance of the evidence not only the fact of the accidental injury but the sufficiency thereof to cause death, independently of other causes, and the testimony in reference to pre-existing disease failed to establish such disease as indirect or contributory cause of death, then the plaintiff can recover, correctly states the law on the subject discussed, and opposition to it based upon the theory that any accident which shortens an insured man's life may be the basis of recovery is not a tenable theory.

[4] ID. DISEASED PHYSICAL CONDITION EFFECT OF ALLEGATION IN ANSWER BURDEN OF PROOF INSTRUCTION.-In such action, an instruction offered by plaintiff the purport of which was that upon defendant rested the burden of proving that the diseased physical condition of the insured contributed to or caused his death, was properly refused, notwithstanding the allegation in the answer that the insured was at the time of the accident in a diseased condition and that disease proximately contributed to death.

BURDEN OF

[5] ID.-ABSENCE OF DISEASE CONTRIBUTING TO DEATH PROOF DUTY OF PLAINTIFF.-The absence of disease contributing