Pending an action of foreclosure, the defendant mortgagor employed an attorney at law to obtain for him another loan with which to pay off the first, together with the accumulated interest and costs of suit. The plaintiff bank agreed to make the new loan and the defendant gave his note and a mortgage upon the property to secure it, the attorney forging an indorsement of the record of this mortgage before turning it over to the plaintiff, who thereupon gave the attorney the amount of the loan in two checks payable to his order, the proceeds of both of which, less the accumulated interest and costs of suit in the foreclosure action, the attorney embezzled or converted to his own use. Held that the trial court was correct in its ruling that in the transaction by which the attorney obtained possession of the defendant's funds, he was the agent of the defendant and not of the plaintiff, and that the defendant must therefore suffer the loss resulting from the attorney's wrongdoing.
SHUMWAY, J.
The only question presented by the appeal which can be regarded as decisive, is contained in the first reason of appeal and relates to the ruling of the court that King was not the agent of the plaintiff, and that in consequence the loss caused by King's embezzlement did not fall upon the plaintiff.
The finding of the trial court that King was employed by the defendant to act for him in respect to the negotiations with the Mechanics and Farmers Savings Bank and the Ridgefield Savings Bank, would be conclusive upon this court but for the fact, apparent upon the record, that in some of the matters pertaining to the transaction it may be truly said that King was not strictly performing duties connected with and appertaining to the relation of attorney and client existing between him and the defendant. It may be that the plaintiff bank in entrusting the mortgage deed to King to be recorded in the land records of Fairfield was asking of King some service not required by his professional duties to the defendant, and if the loss resulting from King's wrongdoing could be directly traced to King's failure to do his duty toward the plaintiff, then it might be fairly claimed that the plaintiff should bear the loss. That King, by forging a certificate of record upon the mortgage, led the plaintiff to believe that the mortgage had been duly recorded, cannot be regarded as the particular default in duty on King's part causing the loss that followed. But King, as attorney for the defendant, having been authorized to make the loan, was charged by his duty to his client to see that the funds received from the plaintiff bank were applied for the defendant's benefit. King was authorized to receive the money from the plaintiff. As the defendants legal adviser and counsel, it was his duty to secure the discharge of the first mortgage and to pay his client's debt. This he failed to do, but appropriated his client's money to his own use. The ruling of the trial court was correct, that in the transaction by which King obtained possession of the defendant's funds he was the defendant's agent.