This case involved a lawsuit by the First National Bank of Las Vegas against George Oberne and Henry M. Hosick to enforce a guaranty on a promissory note that their agent, Thomas Davis, had signed on behalf of their firm. The lower courts ruled in favor of the defendants after a bench trial, but the Illinois Supreme Court reversed and remanded. The court held that even if Davis lacked authority to bind the firm to the guaranty, the defendants could not repudiate the transaction without repaying the portion of the note's proceeds ($560.27) that had actually been used to pay for goods purchased on their behalf. The reasoning rested on principles of agency and unjust enrichment, requiring restoration of benefits received under an unauthorized act before denying liability.

business & regulatory