(182 N.Y.S.) the same; that thereafter Gillette & Livesey, Incorporated, in consideration of certain payments, sold, assigned, transferred, and set over unto plaintiff all its rights, title, and privilege in the property and in the option on the lease; and that J. Hamburger & Co., Incorporated, has threatened and is threatening proceedings against the tenants in said building, and threatened to oust them by reason of its prior relationship of landlord and tenant, and has refused to grant an assignment, pursuant to its agreement. Affidavits are submitted, showing that J. Hamburger & Co., In corporated, has commenced summary proceedings to remove the tenants from said building based upon nonpayment of the rent for the month of February. These proceedings were originally brought by mistake in the name of Bessie Hamburger, but they were discontinued and a new one was commenced in the Municipal Court, Borough of Manhattan, First District. It is to restrain the prosecution of this proceeding, or any other action or proceeding against the tenants in said building, either to collect rents or to dispossess because of the nonpayment of rents, that this order is made, which enjoins any such. action or proceeding pending the determination of the pending action for specific performance. Without determining whether the proof offered tends to satisfactorily establish an exercise of the option of purchase of the lease within the time limited therefor, we are of the opinion that sufficient facts were shown to justify the court in maintaining the present status of the parties until this action can be tried and the rights of the litigants settled after presentation of all the facts. The order should be modified, however, by requiring the plaintiff, as a condition for the granting of the order, to furnish an undertaking in the sum of $500, pursuant to the provisions of sections 616 and 2265, Code of Civil Procedure. As so modified, the order will be affirmed, without costs. Settle order on notice. All concur. (111 Misc. Rep. 595) SPITZER et al. v. BORN, Inc. (Supreme Court, Appellate Term, First Department. May 13, 1920.) 1. Corporations 399 (1)-General officer has power to do any act which directors can ratify. A general officer of a corporation has power prima facie to do any act which the board of directors can ratify. 2. Corporations 400-Company may specify officers who shall bind it and manner in which they shall act. A corporation, which must act through its agents and officers, has power to provide in its by-laws the particular officers who shall have power to bind it and the manner in which they shall act. 3. Corporations 400-Company, which gives agent apparent authority bound, despite secret limitations of by-laws. Only where a corporation has given an agent apparent authority to act for it can it be bound by act of agent or officer performed without actual authority, so that, where a corporation has given an officer apparent auFor other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes thority, a party dealing with such officer on strength of authority is not bound by secret limitations imposed by by-laws. 4. Corporations 429-By-laws of trading company not binding on party relying on authority of general officers. General officers of trading corporation have apparent authority to do any act within scope of ordinary and usual business of corporation, and no by-law of corporation is binding on a party who relies on apparent authority. 5. Corporations 429-Limitation of by-laws on president's authority to execute lease binding on other party. Execution of written lease for three years by manufacturing company as lessee was not within ordinary and usual course of corporate business, to render limitations of by-laws on authority of its president to execute the lease alone not binding on person dealing with it. Mullan, J., dissenting. Appeal from Municipal Court, Borough of Manhattan, Ninth District. Action by Alexander Spitzer and another against Born, Incorporated. From judgment for plaintiffs, defendant appeals. Reversed, and complaint dismissed. Argued February term, 1920, before LEHMAN, MULLAN, and FINCH, JJ. Louis I. Grossfield, of New York City, for appellant. FINCH, J. The action was brought to recover one month's rent claimed to be due under a lease between the parties. The defendant was a corporation, and the lease signed, "Born, Inc. [L. S.] Samuel H. Born, Pres. [L. S.]." No corporate seal was attached. The defendant claimed that the lease did not constitute a corporate obli-· gation. In support of this defendant submitted a copy of the by-laws, which apparently provide that all contracts shall be executed by both the president and the secretary. It is conceded that the secretary had knowledge of the execution of the lease, and there was no contradiction of the fact that he was present at the time it was signed. Neither the president nor the secretary of the defendant testified; the defendant relying on the point of law that the lease did not constitute a corporate obligation. It further appears that the lease is for three years, rent payable monthly, and the rent for the first month was paid by check other than the check of the corporation (a check of some one not acting in behalf of the corporation). The defendant never moved into nor occupied the premises. It is clear that the lease was in fact executed outside of the authority conferred by the stockholders of the corporation upon the officers. [1-3] The rule is well established that a general officer of a corporation has power prima facie to do any act which the board of directors could ratify, and it is clear that the board of directors of the defendant corporation in this case had power to ratify the lease. The fact, however, that the president of the corporation in this case had prima facie authority to sign the lease, does not necessarily preclude For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes (182 N.Y.S.) the defendant from showing that under the by-laws he did not have actual authority. The corporation must act through its agents and officers, and it has the power to provide in its by-laws the particular officers who should have power to bind it and the manner in which they shall act. It is only where a corporation has given an agent apparent authority to act for it that it can be bound by the act of the officer performed without actual authority, and consequently, where a corporation has given an officer apparent authority, a party dealing with the agent on the strength of the apparent authority is not bound by any secret limitations imposed by the by-laws of the corporation. [4] Since corporations transact their ordinary business through their general officers, the courts have held that the general officers of a trading corporation have apparent authority to do any act within. the scope of the ordinary and usual business of the corporation, and no by-law of the corporation is binding upon a party who relies upon this apparent authority. Rathbun v. Snow, 123 N. Y. 349, 25 N. E. 379, 10 L. R. A. 355. In other words, the prima facie authority of a general officer of a corporation cannot be limited as to third persons in regard to acts which, except for the by-law, would be construed as within the apparent scope of the agency; but in no case has any court held that a corporation cannot show that the prima facie authority of the officer did not in fact exist in regard to acts which, though within the corporate powers, are not part of its ordinary and usual business. Gause v. Commonwealth Trust Co., 124 App. Div. 438 at page 451, 108 N. Y. Supp. 1080. [5] The sole question in this case, therefore, is: Was the execution of a written lease for three years by a manufacturing corpóration within the ordinary and usual course of the corporate business? It seems to me that any person dealing with a corporation would realize that the execution of such a lease is an extraordinary act which is usually acted upon by the board of directors and not submitted to the sole direction of a general officer. A party dealing with a general officer under such circumstances may rely upon the prima facie authority of the officer, but he assumes the risk of the corporation proving that the officer acted without authority. It follows that the judgment should be reversed, with $30 costs, and the complaint dismissed on the merits, with costs. LEHMAN, J., concurs. MULLAN, J. I dissent. Were it not for the contrary view entertained by my learned Brethren, I should have thought it was fairly plain that the execution of the lease by its president bound the defendant. The defendant's business was that of making confectionery. The lease was obtained, as itself shows, for that purpose. Concededly, the plaintiff did not know of the by-laws referred to. Was not the making of the lease contract within the apparent scope of the president's authority? I see no more reason to doubt his right to hire this place than to question his ability to bind his company in the purchase of sugar. As was said in a Pennsylvania case involving a lease entered into by a corporation's president whose authority was questioned: "The president of a company presents himself to make a contract, evidently connected with the business; he declares the object and purpose of the contract. Who doubts him? We are a dealing people. Is he asked to produce the charter and the books of the company, to show that he is authorized to make the contract secundum artem? Such is not the custom. This contract * * was within the scope of the authority of the president of the company." Steamboat Co. v. McCutcheon, 13 Pa. 13. In Matter of Tinney, 187 App. Div. 569, 176 N. Y. Supp. 102, an attorney was disbarred for the reason, among others, that he advised his corporation client, sued for rent, to deny the making of the lease. The lease was executed by the president without a special authorization by the board of directors that was required by the company's bylaws, and the attorney argued that he was thus justified in advising the company to interpose a verified answer denying the making of the lease. The official referee had said in his opinion: "In making this claim the respondent loses sight of the well-settled doctrine that presumably the president of a corporation, who is in charge of the management of its business, is authorized to execute a contract negotiated by him, and the corporation, as against third persons, is bound by the acts done within the scope of his apparent authority." It is true that the referee then proceeded to point out that the company ratified by occupying the demised premises, but it is significant that Clarke, P. J., in writing for the Appellate Division, quoted with apparent approval the part of the referee's opinion I have set out. Are we arbitrarily to put leases and other contracts in relation to realty in a class by themselves? Admittedly, a lease contract is as capable of ratification as any other, and the Court of Appeals has said. that * "The president or other general officer of a corporation has power prima facie to do any act which the directors could ratify." Hastings v. Brooklyn Life Ins. Co., 138 N. Y. 473, at page 479, 34 N. E. 289, at page 291. In the Gause Case, 124 App. Div. 438, 108 N. Y. Supp. 1080, cited by Mr. Justice FINCH, the decision was rested squarely on the ground that the contract there in question was so extraordinary that there was no apparent authority to execute it. In the Bohm Case (Com. Pl.) 9 N. Y. Supp. 514, the court followed a decision in Rathbun v. Snow in a lower court. At the Court of Appeals (123 N. Y. 349, 25 N. E. 379, 10 L. R. A. 355) the affirmance was predicated upon the fact that the agent, whose authority had been denied below, had not yet become an agent at the material times, and the court took occasion expressly to repudiate the notion that the contract would have been void because of a by-law of which the other party was ignorant, saying: "By-laws of business corporations are as to third persons private regulations, binding as between the corporation and its members or third persons having knowledge of them, but of no force as limitations per se as to third persons of an authority which, except for the by-laws, would be construed as within the apparent scope of the agency." For the reasons stated, I vote to affirm. (191 App. Div. 844) (182 N.Y.S.) SIMPSON v. ATLANTIC COAST SHIPPING CO., Inc. (Supreme Court, Appellate Division, First Department. May 14, 1920.) 1. Master and servant 120-Shipowner's duty to furnish appliance held not to excuse company employing longshoreman. A shipowner was primarily bound to furnish a backing strap to render safe the derrick furnished by a shipping company to a longshoreman for use in loading the vessel; and shipping company, which employed the longshoreman, had right to rely on fact that such backing strap would be furnished by owner, but was not relieved from its liability to longshoreman, its own employé, to furnish safe appliances. 2. Master and servant 103 (1), 190 (15) —Duty to furnish safe appliance cannot be delegated. Duty to furnish safe appliance to a workman is a duty of the master, and cannot be delegated; so that whether a longshoreman was directed by his hatch boss, or by the man in charge when the hatch boss was absent, to do work in absence of safety appliance, negligence of man in authority at time was negligence of employer. 3. Appeal and error 173 (1)-Defensive contention, not raised on trial, not available. A defensive contention, not made by the master on trial of a servant's action for injuries, cannot be availed of on appeal. 4. Master and servant 107 (1) -Master cannot excuse failure to furnish safety appliance, though chains furnished for other purpose. A master cannot excuse itself for its negligence in failing to furnish a safety appliance by claiming its foreman should have used chains in fact furnished for another purpose. 5. Master and servant 369-Defense of remedy under Compensation Law held not available to employer doing business in foreign state. Employer of a longshoreman being a foreign corporation, and having been doing business in a foreign state, where accident to the longshoreman happened, in absence of anything to show the longshoreman has any remedy under any Workmen's Compensation Law of any state, no such defense is available to the employer, when sued for injuries. 6. Seamen 29 (5)-Longshoreman employed by independent contractor entitled under maritime law to indemnity for effects of injury. Where longshoreman is employed by independent contractor in loading a ship, and is injured by failure of contractor to furnish a safety appliance, he is entitled to indemnity for resulting effects of injury, even under rule of maritime law, not being limited to costs of medical treatment and cure. Clarke, P. J., and Page, J., dissenting. Appeal from Trial Term, New York County. Action by George Simpson against the Atlantic Coast Shipping Company, Incorporated. From a judgment on a verdict for plaintiff, and from an order denying its motion for new trial (176 N. Y. Supp. 731), defendant appeals. Judgment and order affirmed. Argued before CLARKE, P. J., and LAUGHLIN, SMITH, PAGE, and MERRELL, JJ. Amos H. Stephens, of New York City (E. C. Sherwood, of New York City, of counsel), for appellant. David M. Fink, of New York City (Moses Feltenstein, of New York City, of counsel, and Jacquin Frank, of New York City, on the brief), for respondent. For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes |