Bankruptcy.
(4.) As a general rule the authority of an agent (i.e., a bare authority not coupled with an interest) is revoked by the bankruptcy[[167]] of the principal. Although there seems to be no express decision on the point, it seems probable that the same rule would apply in the case of a stakeholder where either of the depositors became bankrupt before the money was paid over to the winner. As the stakeholder is, according to Hampden v. Walsh,[[168]] merely the agent for each depositor, the safest plan for him to adopt on receiving notice of a depositor’s bankruptcy would be to consider his authority as to that stake revoked, and repay it to the trustee in bankruptcy; or perhaps he would be safe in paying it to the bankrupt himself, if the trustee had not intervened to claim it.
Stakeholder cannot sue for stakes.
As the stakeholder is merely the agent for the depositors, he cannot maintain an action for the stakes. Thus, in Charlton v. Hill[[169]] the Clerk of the Course of a race meeting, who was sued by the plaintiff for the stakes won by him in one race, attempted to set off against that claim a sum due from plaintiff in respect of the stakes of another race. Held, that he could not do so as no action could have been maintained by the defendant seeing that the plaintiff could at any time recover the stakes back again.
Competitors can choose their own stakeholder.
It is, moreover, competent to the competitors to choose their own stakeholder or to select a substitute for the one nominated by the rules of the race. Thus, in Dines v. Wolf[[170]] by the rules of the race the stakes should have been paid to the Treasurer of the Australian Jockey Club, but plaintiff insisted on their being retained by the defendant. Held, therefore, that plaintiff could not make defendant liable as he had acquiesced in the change.
Liability of steward for default of stakeholder.
A question has occasionally been raised whether a steward who nominates a stakeholder can be made liable for the latter’s insolvency or default. It is difficult to see how he could be without express agreement, or perhaps unless he wilfully appointed a man unfit for the post.
Liability of stakeholder.
The stakeholder should be very careful before he pays the stakes to the winner to ascertain that the winner has been so declared by a competent authority, seeing that if he pays and it turns out that the judge, umpire, or stewards have not acted in accordance with his or their authority, he may be liable to the other subscribers. See Smith v. Sadler.[[171]]