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RULE 24.—On the death of a partner, the survivOn death ing partners and ultimately the last survivor, or his partner
representative, must sue on contracts made with the
firm. brought by survivor.
A., B., and C., are partners, C. dies, an action on any contract made with the firm, i. e., with A., B., and C., must be brought by A. and B., and the representatives of C. cannot join (s).
The same rule appears to hold good with regard to unincorporated companies, supposing of course that these companies are not empowered to sue by a public officer.
(8) See Rule 16.
CORPORATIONS AND INCORPORATED BODIES.
RULE 25.—A corporation, or incorporated body, must sue in its corporate name.
A corporation is a fictitious person, created by law, Corporaand endowed with a capacity to acquire rights and incur in corporate obligations as a means to the end, for the attainment of name.
Nature of which the corporation is created. It may, and generally corpora
, does, consist of a number of individual members, but the tion. rights and obligations of these individuals are not the same as the rights and obligations of the corporate body (a). The fundamental distinction, therefore, between a partnership and a corporation or company is, that while the firm of M. and Co. is nothing but A., B., and C. who compose the firm, a corporation-e.g., the Royal Miners' Co. (Limited), -is totally distinct from A., B., and C., the members of the company. It follows, that while a firm must sue in the names of the individual members, a corporation or company must sue in its corporate name (1). It is an illustration of the true character of a corporation that its existence is unaffected by the retirement, death, &c., of the individual members of it, and that a corporation can sue and be sued by its own members.
(a) Even in the case of a corporation sole, e.g., a bishop, the rights of the corporation are distinct from the rights of the person who constitutes the corporation. i Lindley, Partnership, 2nd ed., 4. Bradshaw v. Bank of Upper Canada, L. R. 1 P. C. 479 ; Metropolitan Saloon Co. v. Hawkins, 28 L. J. 201, Ex. ; 4 H. & N. 87.
(6) 2 Lindley, Partnership, 2nd ed., 888.
RULE 26.— A corporation, or incorporated body, cannot sue on a contract not under seal (c).
Corporation cannot sue on contract not under seal.
Corporation can contract by deed only
A corporation cannot sue on any contract not under seal, because a corporation cannot, as a general rule,
a (subject, however, to exceptions which have now grown larger than the rule itself (d) ), enter into any contract, binding either upon the other party to the agreement, or upon the corporation, except under its corporate seal.
“ The rule of law requiring contracts entered into by corporations to be generally entered into under seal and not by parol, appears to be one by no means of a merely technical character .... The seal is required as authenticating the concurrence of the whole body corporate :
either a seal or some substitute for a seal, which by law shall be taken as conclusively evidencing the sense of the whole body corporate, is a necessity inherent in the very nature of a corporation” (e).
Hence, an agreement to supply a mining company with iron bars (f ), a contract with a water company to supply iron pipes (g), an engagement by a corporation to pay an increased salary to a town clerk (h), to pay for work done in building a workhouse (i), and many other agreements by corporations (1:) have been held invalid, because not made under seal.
(c) Bacon, Abr., Corporations, E. 3.
(d) South of Ireland Coll. Co. v. Waddle, L. R. 3 C. P. 474, judgment of Montague Smith, J.
(e) Mayor of Ludlow v. Charlton, 6 M. & W. 823, judgment of Rolfe, B. See also Arnold v. Mayor of Poole, 4 M. & G. 860 ; 12 L. J. 97, C. P.
(f) Copper Miners' Co. v. Fox, 16 Q. B. 229 ; 20 L. J. 174, Q. B.
(k) Paine v. Strand Union, 8 Q. B. 326; Arnold v. Mayor of Poole, 4 M. & G. 860 ; Diggle v. London and Blackwall Rail. Co., 5 Ex. 442; 19 L. J. 308, Ex.
Ecception 1.—Where a corporation enters into a contract concerning matters necessarily incidental to the purposes of the business of the corporation.
Exceptions. A corporation can sue (1) on contracts relating to Contract matters of the corporation, since, “it is now perfectly on matters established by a series of authorities that a corporation to business. may with respect to those matters for which they are expressly created, deal without seal. This principle is founded on justice and public convenience, and is in accordance with common (m). This exception, though specially applicable to bodies constituted for the sake of trade (n), and though it has been considerably extended in order to meet their convenience (0), appears, in principle, to apply to all corporations.
It is often difficult to decide whether a given contract falls within the rule or the exception. A contract, for example, with a company incorporated for the working of collieries to supply them with a pumping-engine has been held valid, though not under seal (p). So has an agreement to supply a steam-boat company with provisions (q), and an agreement by the same company for the carriage of a passenger (). Again, on the same
(1) A corporation's right to sue is, subject to very slight exceptions, strictly correlative to its liability to be sued, i.e., it can be sued on contracts on which it can sue, and vice versa ; and cannot be sued on contracts on which it cannot sue, and vice versa. It is, therefore, convenient to introduce, as exemplifications of the general rule, and the exceptions to it, cases which directly refer only to a corporation's liability to be sued.
(m) Australian Royal Mail Co. v. Marzetti, 11 Exch. 234 ; per Pollock, C. B.
(n) Clarke v. Cuckfuld Union, 1 Bail. C. C. 86, judgment of Wight
(0) Henderson v. Australian Royal Mail Co., 5 E. & B. 409 ; 24 L. J. 322, Q. B. ; South of Ireland Colliery Co. v. Waddle, L. R. 3 C. P. 474, judgment of Montague Smith, J.
(p) South of Ireland Colliery Co. v. Waddle, L. R. 3 C. P. 463 ; 37 L. J. 211, C. P.
(9) Australian Royal Mail Co. v. Marzetti, 11 Exch. 228 ; 24 L. J. 273, Ex.
(r) Henderson v. Australian Royal Mail Co., 5 E. & B. 409 ; 24 L. J. 322, Q. B.
CORPORA. principle, an agreement by a telegraphic company to pay
a commission to an agent on messages obtained for the company (s), by a gas company to supply gas (t), for guardians to pay for goods supplied (u), or for work done (r), have been held valid, though not made by deed. But with these cases should be contrasted others (some of which have been already mentioned), such as the Copper Miners' Co. v. For (y), where a contract, that the defendant would supply the plaintiffs with iron rails, was held not valid, because it was not under seal, and had not reference to matters necessarily incidental to the business of the company. “Had the subject matter of this contract been copper, or if it had been shown in any way to be incidental or ancillary to the business of copper miners, the contract would have been binding, although not under seal; for where a trading company is created by charter, while acting within the scope of that charter, it may enter into the commercial contracts usual in such a business in the usual manner. But the iron rails, the subject matter of this contract, were not shown to have any connection with the business of copper miners" (2). And similar to the Copper Miners' Co. v.
. For, is the London Dock Co. v. Sinnot (a), in which it was held, that a contract with the London Dock Co. (a corporation constituted for the purpose of carrying on a particular trade), for cleansing and removing the filth accumulating in their docks was invalid, because not under seal. The decision in this latter case is however open to some doubt (6).
(8) Reuter v. Electric Telegraph Co., 26 L. J. 46, Q. B. ; 6 E. & B. 341.
(0) Church v. Imperial Gas Co., 6 A. & E. 846.
(x) Kaigh v. North Bierly Union, 28 L. J. 62, Q. B. ; E. B. & E. 873; Nicholson v. Brad ficld Union, L. R. 1 Q. B. 620; 35 L. J. 176, Q. B.
(y) 16 Q. B. 229 ; 20 L. J. 174, Q. B.
(6) South of Ireland Colliery Co. v. Waddle, L. R. 3 C. P. 463,