Ing promises or representations to third persons calculated to

Induce them to change their legal relations.

" Vested with authority " includes authority acquired

through the will of the principal or by operation of law, and

authority acquired either prior to or subsequent to the per-

formance of the representative act.

A servant is a representative vested with authority to per-

form operative acts for his master not creating new primary

obligations, or bringing third persons into contractual relations

with the master, or otherwise causing them to change their

legal position. A master comes under obligations to third

persons by the act of his servant only when the servant

commits a breach of the master's primary obligations and

thus creates secondary substituted obligations.

" Vested with authority " means here the same as in the

preceding definition. But the authority in such case must

be real, not ostensible merely, since no doctrine of estoppel

^ Applicable to the law of principal and agent, and the law of master

and servant.

^ Applicable only to the law of principal and agent.

^ Applicable only to the law of master and servant.

2

18 Agency.

Is applicable except where a third person is induced to change

his position. If he is induced to change it in consequence of

the ostensible authority, then the representative is an agent.

To put the whole matter shortly, an agent is one really or

ostensibly authorized to create voluntary antecedent or pri-

mary obligations for his principal in I'avor of third persons,

or to acquire such obligations for his principal as against

third persons ; while a servant is one authorized to perform

operative acts not creating primary obligations, but which

may result in the breach of antecedent primary obligations,

Voluntary or involuntary.

Since it is the nature of the act to be performed that con-

stitutes the essential difference between the two classes of

representatives, it follows that the same rejjresentative may

be both an agent and a servant, and herein lies the source

of much of the confusion that prevails in the discussion of the

law of representation. It is often said that the distinction

lies in the fact that an agent is vested with discretion, while

a servant is not.^ But this is obviously incorrect. A railway

conductor is not an agent merely because he is vested with a

wide discretion as to the management of his train ; he may or

may not be a vice-master, but he is a servant so long as his

authority is to do an act not resulting in contractual obliga-

tion ; if vested with authority to engage employees or make

contracts of carriage then for that purpose he is an agent and

not a servant, since his act results in the creation of a con-

tractual obligation. So a representative authorized to sell a

horse to a specified person at a specified price for cash is not

a servant merely because he has no discretion as to the terms

of the sale ; his act results in a contractual obligation, and

he is therefore an agent ; if, however, he is vested with autlior-