the undoubted rule that the law will not imply a promise where there is an express agreement covering the subject. The facts as found by the trial court do not support the premises of appellant's claim; hence the rule of law invoked is not here applicable.

The facts as found in this connection are to the effect that Ryden at one time had an option to purchase the business he was managing for Johnson, but he was not bound to exercise the option, never did, there was never any transfer of the business to him, and from first to last his relation thereto was that of agent and manager for Johnson, and, further, there was no agreement, express or implied, that Ogren should or might acquire any interest in the business. The finding is that "Ogren had some talk with Ryden about forming a partnership with him in such business." The concluding sentence of the receipt, "or to apply to a share in the clothing store now known as the Alex Johnson Store Account," implied at most only the right of Ogren so to apply the money advanced to the payment of his share in the business if perchance he should ever purchase it. The fact that Johnson's business name was the "Alex Johnson Store Account"; that Ogren advanced to Ryden $2,000, nearly all of it in a check payable to the order of Johnson by his business name, for the purpose of meeting the bills of his store business; that the money was deposited in his bank to his credit, and afterwards taken out of the bank upon checks personally signed by him and so used, but without his actual personal knowledge, was expressly found by the trial court. Again, it was found that Ryden was the agent and manager of Johnson, fully authorized to conduct the store business, to buy and sell goods connected therewith, and by implication authorized to do whatever was reasonably necessary to execute the objects of his agency; that is, to conduct a mercantile business for his principal. The only limitation upon his express or implied authority was that he had no authority to borrow money for the use of the business or to draw checks upon his principal's bank account in payment of indebtedness contracted in the business. This necessarily implies that debts would be contracted in the business, and that they might be paid by the agent in any manner, except as stated; for example, out of the proceeds of the sales of the goods purchased by the agent for the business. There is no finding that Ogren ever had any knowledge of this limitation upon the apparent general authority of

Ryden, or that Ogren was guilty of any wrong or bad faith in the premises. The mere fact that he knew that Ryden for some undisclosed reason did not wish to call on Johnson to furnish at that particular time the money needed in the business does not impeach Ogren's good faith. This case, then, is within the rule that if a party receives the money of another, which in equity and in good conscience he ought to pay over, the law implies a promise so to pay it, and an action for money had and received will lie for its recovery. Brand v. Williams, 29 Minn. 238, 13 N. W. 42.

The case of Eckart v. Roehm, 43 Minn. 271, 45 N. W. 443, relied upon by appellant, is not in point; for the facts of this case are essentially different than were the facts in the case cited. In that case the principal did not receive any benefits from the unauthorized act of his agent. The facts were that the principal furnished his agent with funds to pay the laborers on the principal's farm; but he kept the money for his own. use, and without the authority, knowledge, or consent of the principal purchased clothing for the laborers from a third party, who was not justified in believing that the agent was authorized, and deducted the price of the clothing from the wages of the laborers. The court held upon such facts that the principal had not ratified the act of his agent and was not liable for the value of the clothing. Again, the facts in this case justify the conclusion that Johnson ratified the act of Ryden in procuring the money from Ogren, for he had the full benefit of it.

True it is, as claimed by counsel for appellant, that as a general rule ratification by a principal of the unauthorized act of his agent must be with full knowledge of all the material facts of the transaction. He cannot be charged with such knowledge by his failure to inquire of others concerning the acts of his agent; for he may assume, until otherwise advised, that his agent will obey his instructions. Where, however, the principal receives from his agent the proceeds of the unauthorized act, with his report or account of the transaction, he cannot ignorantly or purposely shut his eyes to means of information within. his possession and control, and thereby avail himself of the benefits of the transaction, and then repudiate it. If he so receives and retains the benefits of the transaction, he ratifies it. 1 Am. & Eng. Enc. (2d Ed.) 1206; Columbia Mill Co. v. National Bank of Commerce, 52 Minn. 224, 53 N. W. 1061; Landin v. Moorhead Nat. Bank, 74 Minn.

222, 77 N. W. 35; Combs v. Scott, 12 Allen, 493, 497; Sartwell v. Frost, 122 Mass. 184.

In the case of Landin v. Moorhead Nat. Bank, supra, the cashier of the bank, without the authority of the bank, shipped and sold a carload of wheat for the plaintiff in the name of the bank, and the proceeds of the sale were received by the bank, but by mistake it paid them to a party other than the plaintiff. The bank was held liable to the plaintiff for the money so received by it, for the reason, as stated by the court, that "shipping wheat for third parties is not within the ordinary duties of the cashier of a national bank, and there is no evidence that in this instance the cashier had any actual or apparent authority from the bank to engage in any such business; and hence the shipping and selling of the wheat for the plaintiff was the individual act of the cashier, for which the bank would not be liable. But, admitting all this, it is equally true that, if the bank received the proceeds of plaintiff's wheat, it must account to him for the money thus received." In the case at bar the principal not only received the money and had the full benefit thereof, but the whole transaction was entered in his account books, the money credited to his bank account, which he exclusively controlled, and he personally signed the checks whereby the money was drawn from the bank and used in paying his bills. It would be a gross miscarriage of justice to permit the principal, under such circumstances, to shut his eyes to the means of information in his possession and control, to say that his agent procured for him the money without his consent, knowledge, or authority, and to keep the money and repudiate the act of his agent whereby he secured the money for him. The record presents a clear case of ratification by the principal of the unauthorized act of his agent.

The appellant further contends that, if a cause of action existed against Johnson, it was barred by the statute of limitations before his death. It may be conceded that such would be the case if all payments made upon respondent's claim be rejected as unauthorized. The last payment was made and indorsed on the claim August 29, 1899, some four years before the expiration of the six-year limitation. It was made by Ryden, but appellant claims that it was not authorized by Johnson. It was made in money derived from the sale of goods from the store of Johnson, and by goods therefrom upon a debt of the Alex

Johnson Store Account; that is, when the act of Ryden in obtaining the money from Ogren for the store was ratified by Johnson, it became such a debt precisely as if the agent's act had been originally authorized. The only limitation on Ryden's authority to pay the debts of the store was, as we have stated, that he could not borrow money for that purpose, nor draw checks upon Johnson's bank account in payment of the indebtedness of the store. He could, however, pay such debts by goods from the store, or from the proceeds of the business of the store. We hold that the payment was authorized, and that respondent's claim is not barred by the statute of limitations. Judgment affirmed.

NATIONAL PROTECTIVE LEGION v. THOMAS D. O'BRIEN.1

July 19, 1907.

Nos. 15,283-(207).

Beneficiary Association-Sale of Endowments.

R. L. 1905, § 1594, defines beneficiary associations and prohibits the sale by them of endowments. It then defines fraternal beneficiary associations. R. L. 1905, § 1703, authorizes beneficiary and fraternal associations to make provision for (1) sick and disability benefits; (2) payment of funeral expenses; (3) death benefits. It is held that the two sections prohibit the sale of endowments by fraternal beneficiary associations.

Same.

A fraternal beneficiary association, executing a contract the substance of which was its agreement to pay dividends or "maturity benefits" to its living members not under disability, the incidents of which were to pay small disability benefits as a loan and an insignificant death benefit for a flat premium, is held to have been engaged to that extent in the sale of endowments and in a business prohibited by law.

Action in the district court for Ramsey county to restrain defendant from revoking or cancelling the license issued by him as insurance.

1 Reported in 112 N. W. 1050.

commissioner of the state of Minnesota to plaintiff to transact business in the state as a fraternal beneficiary association. Defendant demurred to the complaint. From an order, Bunn, J., sustaining the demurrer, plaintiff appealed. Affirmed.

How, Butler & Mitchell, for appellant.

Edward T. Young, Attorney General, and Royal A. Stone, Assistant Attorney General, for respondent.

JAGGARD, J.

This appeal, in a test case, is from an order sustaining a demurrer to the complaint. Plaintiff and appellant is a corporation organized under the laws of New York as a fraternal beneficiary association. For six years it had been annually licensed to transact business in Minnesota, and had been engaged in issuing the particular form of contract here in issue. The defendant and respondent, the insurance commissioner of the state of Minnesota, threatened to revoke the license because of the alleged illegality of that contract. No question of the financial condition of the company was involved. Plaintiff brought this proceeding to restrain defendant from revoking its license.

The first question presented by this appeal is whether the statutes prohibit fraternal beneficial associations from selling endowments. In our opinion sections 1594 and 1703, R. L. 1905, contain such prohibition. Section 1594 defines terms, and among other things provides:

"Beneficiary association" shall mean a corporation, society or voluntary association organized and carried on for the sole benefit of its members and their families, relatives, or dependents, but not for profit, and insure the lives of its members only upon the whole life assessment plan, so called, and in which organization admission to membership, by a vote of the members or some governing body thereof, is a prerequisite to being entitled to such relief or policy of insurance and which association sells neither endowments nor annuities.

"Fraternal beneficiary association" shall mean a corporation, society or voluntary association organized and carried on for the sole benefit of the members and their beneficiaries, but not for profit, and having a lodge system and ritualistic form of work and representative form of government.