Watteau v Fenwick (1893) 1 QB 346
Humble had been carrying on business at a Public House called the Victoria Hotel at Stockton- on- Tees. Humble transferred the business to the defendants, Fenwick and Company, a firm of Brewers. Humble remained as defendants’ Manager, but the license was always taken out in Humble’s name and his name was painted over the door.
Under the terms and agreement made between Humble and the defendants, Humble had no authority to buy any goods for the business except bottled Ales and mineral waters. All other goods required were to be supplied by the defendants themselves.
Over the years, Cigars, Bovril and other articles had been delivered at the Victoria Hotel. The plaintiff, Watteau, had given credit to Humble only.
Action was brought to recover the price of those goods.
County Court Judge allowed the claims for the Cigars and Bovril only and gave judgment for the plaintiff.
Defendants appealed to the Queens Bench.
A Manager of a Public House would usually have authority to make purchases of the kind in issue and therefore the defendants, as principal, were liable.
In the absence of express knowledge of the restrictions imposed by the principal, the plaintiff could rely on such usual authority.
This case discusses the liability of an undisclosed principal or a dormant partner, where such a partner would be liable for acts of the agent which had been expressly forbidden. This case has been severely criticized by academics, but still has not been overruled and therefore stands as good law.