ld and make a lower rate as requested. Could his
company repudiate the contract? Clearly not, for it was A's duty to
make contracts for insuring properties. If the insured knew that the
agent had been expressly limited in the rates for insuring and that he
was going contrary to his instructions in making the lower rate, then,
indeed, the company would not be bound by the contract. Otherwise it
could not repudiate the act, for it would fall within the general
principle that a principal is bound by the acts of his agent done
within the general scope of his business or employment; and such a
contract clearly would be within the limit. For, indeed, this is the
very business of the agent--to effect insurance.

The only thing necessary, therefore, for a person doing business with
a general agent is to find out whether he is such an agent; and when
this is learned then a person can safely transact business with him,
doing anything within the general scope of his powers, unless the
person actually knows that some limit or restriction has been put upon
the agent. It is not his duty to find out what the powers of a general
agent are, but simply whether he is a general agent or not.

But the rule is very different that applies to the liability of a
principal who employs a special agent. In such cases it is the duty of
the person doing business with him to inquire what his powers are, for
the principal will not be bound beyond these. Such an inquiry,
therefore, must be made. He must ask the agent to show the authority
under which he is appointed, or in some way clearly convince the other
what his powers are before any business can be safely done.

The authority of a special agent is often stated in writing, and the
paper is called A POWER OF ATTORNEY. _In selling land an agent should
always have such a power_, because a good title to land can only be
given in writing, and this power of attorney should be copied in the
records kept for this purpose with the deed itself to show by what
authority the agent acted in selling the land. Every now and then when
a person buys a piece of land and examines the title to find out
whether it is perfect or not, he discovers that somewhere in the chain
of title a deed was made by the agent of the seller instead of the
seller himself, and the buyer had forgotten to put the power of
attorney on record with his deed. The omission to do this is often
serious. It is in truth just as important for an