contracts of a body corporate will, if they have been acted upon, be enforced in a court of equity both in favour of and against a corporation (u). Leaving for the present the statutory and equitable exceptions to the common law rule, which require the contracts of a body corporate to be under seal, it will be found that the remaining exceptions may, to use the words of Lord Denman, be referred to convenience amounting almost to necessity (x). Hence the exceptions recognized almost simultaneously with the framing of the rule (y). This class of exceptions is recognized more fully in trading than in municipal corporations, for, whilst a trading corporation may make all such contracts as are of ordinary occurrence in their trade without the formality of a seal (2), a municipal corporation may make a binding parol contract apparently only where the act is required for convenience, or where either the acts are trivial in their nature and of frequent occurrence, so that the doing them in the usual way would be inconvenient or absurd, or such that an overruling necessity requires them to be done at once (a).1 Thus in determining upon the validity of parol contracts made by corporations, where there is no performance and no statutory provision, in the one case the test is the convenience and necessity of the act, in the other the conformity of the act with the ordinary transactions of the trading body. And it would seem that the magnitude or insignificance of the contract of a trading body is of no moment in deciding upon the validity of such contract (b). In Wells v. Kingston-upon-Hull (c), which was decided (u) Marshall v. Queenborough, supra; Stevens Hospital v. Dyas, 15 Ir. Ch. 405, 420. corporate acts, without either a vote, or deed, or writing; " and that "this doctrine is applicable equally to public and (x) Church v. Imperial Gaslight Co., private corporations, but in applying it, 6 A. & E. 946. (y) Supra. (z) South of Ireland Colliery Co. v. Waddle, L. R., 3 C. P. 463. (a) Per Alderson, B., Diggle v. London & Blackwall Rail. Co., 5 Ex. 442. 1 Judge Dillon, in his work on Municipal Corporations, § 383, where the cases are fully collected, says that "corporations may be bound by implied contracts within the scope of their powers, to be deduced by inference from authorized however, care must be taken not to violate other principles of law; " and such seems clearly to be the law in this country. See, also, id. §§ 132, 750; Ang. & Ames on Corp. § 237, where it is stated that "in general, throughout the United States, it [the old rule of the English law] is entirely exploded." (b) Per Bovill, C. J., South of Ireland Colliery Co. v. Waddle, L. R., 3C. P. 463. (c) L. R., 10 C. P. 402; 44 L. J., C. P. 257; 32 L. T. 615. [20*] in *1875, the principle laid down in Church v. Imperial Gaslight Co. (e), with reference to the exceptions to the rule that a municipal corporation can only contract under seal, was considered and adopted. The defendants, a municipal corporation, were possessed of a dock, which was let to parties requiring the same for the repairs of vessels. The plaintiff had paid to the borough treasurer the entrance money for his ship, which was accordingly entered in the turn book. When the turn of the vessel came, another vessel was admitted in her stead. In an action for breach of contract, the defendants contended that the contract ought to have been under the seal of the corporation. A rule nisi was accordingly granted, but after argument discharged. Lord Coleridge said, "There is no doubt a distinction between trading and other corporations, but I can find no authority for the position that a municipal corporation, when engaged in any trading transaction, is to have the same immunity as a corporation created under an Act of Parliament for the very purpose of trading. I treat this case as that of a municipal corporation, and one to which the exception in favour of trading corporations is inapplicable. But on reference to the authorities it will be seen that from the very earliest times certain exceptions to the rule that required a seal were established. These are very conveniently summarized in the judgment in Church v. Imperial Gaslight Co. (f). The law, as there laid down, is cited by the Court of Exchequer with approval in the case of Mayor of Ludlow v. Charlton (g), a case in which the court took a view adverse to the right of persons contracting with corporations without a seal. The principle laid down is that, wherever to hold the rule applicable would occasion very great inconvenience, or tend to defeat the very object for which the corporation was created, the exception has prevailed; hence the retainer by parol of an inferior servant, the doing of acts very frequently recurring, or too insignificant to be worth the trouble of affixing the common seal, are established exceptions. It appears to me that this case comes well within the description there given of the kind of acts which may be done by a corpora tion without their seal." In a previous case, Austin v. The Guardians of Bethnal (e) Supra. (ƒ) 6 A. & E. 8C1. (g) 6 M. & W. 815, 822. *Green (h), the same court, whilst recognizing the exceptions [21*] to the rule, decided that the contract for the engagement of a clerk to the master of a workhouse by a board of guardians, must, in order to bind the guardians, be under their seal. In a note to this case, the reporters refer to Smart v. Guardians of West Ham Union (i), with respect to the distinction between the question whether there has been a due appointment to an office for some purposes and the question of liability by way of contract. An agent may be appointed under the seal of the corporation, yet if the object for which he is appointed is entirely unconnected with the purposes and beyond the power of the corporation, the corporation will not be bound by his acts.1 Thus it is not competent to a company incorporated in the usual way for the formation and working of a railway, to draw, accept, or indorse bills of exchange, and it is immaterial that the acceptance was given by order of the directors, and under the common seal of the company (j). Upon this point the rule of law is thus stated by a learned author (k):-"However, it has been considered that a trading corporation may differ from others as to its powers of contracting, and its remedies on contracts relating to the purposes for which it was formed. Thus, such a corporation may in some cases bind itself by promissory notes and bills of exchange; and it was even held that the Bank of England might, without deed, appoint an agent for such purposes. But a corporation will not have these extraordinary powers, unless the nature of the business in which it is engaged raises a necessary implication of their existence." This statement of the law was cited with approval in the above case by Montague Smith, J. The general rule is, that corporations have at common law no power to appoint an agent to bind them by a bill of exchange or promissory note. This rule, however, is subject to the following exceptions: (a.) In the case of the Bank of England (); (7) L. R., 9 C. P. 91. (i) 10 Ex. 867; 11 Ex. 867. 1A corporation may employ an agent to perform services consonant to its general design without any specific authority for that purpose conferred by the charter. Kitchen v. Cape Girardeau etc. R. R. Co. 59 Mo. 514. (j) Bateman v. The Mid-Wales Rail. Co., L. R., 1 C. P. 499. (k) Smith, Merc. Law (7th ed.), 105–6. (1) Bateman v. Mid-Wales Rail. Co., supra. (b.) When the company has express authority (m). An agent, then, may be appointed by writing, by word of mouth, or the appointment may be implied from the con[22] duct of *the principal without evidence of any express authority. And here it may be laid down generally that when one has so acted as from his conduct to lead another to believe that he has appointed some one to act as his agent, and knows that that other person is about to act in that behalf, then, unless he interposes, he will in general be estopped from disputing the agency, though in fact no express agency existed (n). The illustrations of this principle belong more properly to an examination of the authority of agents. (m) Slark v. Highgate Archway Co., 5 Taunt. 792. (n) Pole v. Leask, 28 Beav. 562; 8 L. T., N. S. 615; 33 L. J., Ch. 155. Limitation of the principle Power of co-owner to authorize sale 28 2222 28 28 stated by Lord Denman.... 26 Committeemen THE power of authorizing another to do a certain act or to ratify an unauthorized assumption of authority may be vested either in a single individual or in a number of individuals. It may be vested in a single individual in either of two cases; and these are where no other than that person can act as principal, and where he, in common with others, exercises a power of appointing agents. It is a fundamental rule of the law of agency that whatever a person may do in his own right he may do by means of an agent. Hence it follows that if one of several principals may of his own right act on behalf of the other principals, he may appoint an agent to act on their joint behalf. One of several principals has clearly no such power where each of them has a distinct interest in the subject matter, unless the others consent. In order, however, to put the matter more clearly, it will be well to say a few words of the several varieties of joint principals. 1 As to double agencies, see ante, p. 14. |