predicated their claims; that the contracts were not made for any legitimate purpose for which the Elevator Company was organized. The company was organized under the general law of the state of Kansas concerning private corporations (General Statutes of Kansas 1909, § 1699), which provides, among other things, that the purposes for which private corporations may be formed are:

"(39) The conversion and disposal of agricultural products by means of mills, elevators, markets and stores, or otherwise."

Section 1701 of that law provides that the corporate name of every such corporation * * shall indicate by its corporate name the character of the business to be carried on by the corporation."

It is argued that the adoption by the corporation of the corporate name "the Manchester Mill & Elevator Company" imposed a limitation upon the scope of its business, confining it to the operation of a mill and elevator, thereby excluding the purchase and sale of wheat as any part or portion of its legitimate business. It is noticeable that clause 39 of section 1699 provides for the creation of corporations for "the conversion and disposal of agricultural products by means of mills, elevators, markets and stores, or otherwise." This, in our opinion, necessarily implies that the operation of mills and elevators is an appropriate and lawful method to be resorted to for "converting and disposing of agricultural products." If so, the corporate name of the plaintiff in error "Mill & Elevator Company" indicates that a part of its business is the purchase and sale of wheat.

In harmony with this view, the charter of the defendant corporation, as granted to and accepted by it, specified that the purpose for which it was created was "to conduct a general grain and milling business, to buy, sell, and ship and handle any and all kinds of grain, manufacture flour, feed and feed meal, alfalfa meal and alfalfa product, any and all other products of grain, * * * and to do and perform all other acts necessary for the carrying on of the management of the above-named business."

The case of Ginrich v. Mill Company, 21 Kan. 61, is cited in support of their contention. All that case decides, in any way affecting this, is that under the provision of the corporation law of Kansas, providing for the creation of private corporations for "the conversion and disposal of agricultural products by means of mills," etc., a corporation may be created to "build and create a flouring mill." This, instead of supporting the contention of plaintiff in error, in our opinion, necessarily implies that the maintenance of a flouring mill and elevator is germane to the general business of converting and disposing of agricultural products and that such a mill or elevator is among the lawful means for accomplishing the purpose of converting and disposing of such products. We, therefore, are unable to give our assent to the proposition that the business of buying and selling wheat is so foreign to the permissible business suggested by the corporate name of plaintiff in error as to render any contracts for purchasing wheat void.

[2] The next contention of the plaintiff in error is that McAndrews, as president of the defendant corporation, had no authority to execute the contracts, for the breach of which the petitioning creditors as

serted claims for damages. The evidence on this point disclosed, without substantial contradiction (employing now the language found in the bill of exceptions):

*

"That W. E. McAndrews owned a large majority of the stock of the Manchester Mill & Elevator Company; that the actual management of its business was practically solely done by said W. E. McAndrews; that its mill and elevator were in charge of W. E. McAndrews; that all business of the company was done solely by the said McAndrews; that none of the other officers or directors of the company took any part in the management of the business, or operation of the elevator or mill, and that none of them, except the said McAndrews, had any experience of running concerns of this character, all of them being farmers, except one, who was cashier of a bank; that all of them knew that the said McAndrews was running said business and said plant; that in all the purchase contracts made with him by the petitioning creditors, the said creditors, and each and all of them, expected to receive the wheat under said contracts and that the dealings with McAndrews were in no wise, so far as they were concerned or had any knowledge of, deals amounting to wagers on the price of wheat; that as far as they knew McAndrews, acting on behalf of the respondent, intended and expected to carry out his contracts by the delivery of wheat thereunder.”

McAndrews had never been formally elected general manager of the corporation, and his acts in executing the contracts in question were never formally approved or ratified at any meeting of the board of di-. rectors of the corporation. Evidence was also offered that several days before the charter of the corporation was applied for or granted the following by-law appears to have been adopted (and was offered in evidence by the defendant corporation), as follows:

"No debts or obligation shall be contracted by this company except upon the authority of the board of directors, and when such indebtedness shall be authorized, shall be evidenced by notes or contracts which shall be signed by the president and secretary of the company and duly approved by the executive committee before being issued."

At the time this evidence was offered no proof had been offered tending to show that any of the petitioning creditors had any knowledge of this by-law or its contents, and counsel for the corporation then admitted that they had no evidence and no such evidence would be offered. Whereupon an objection to the introduction of the by-law was sustained by the court.

On the foregoing evidence the court submitted the case to the jury in a charge ably covering all the legal questions in the case, and directed the jury to answer the several questions specified above. Before the jury left the box the defendant's counsel requested the court to give this instruction to the jury:

"You are instructed that the directors of a corporation are the body which, under the law, is authorized to make contracts for it. It may delegate authority to a general manager to conduct the ordinary business of the corporation and this is the usual authority existing in a general manager. If, therefore, you find from the evidence that the ordinary business of the Manchester Mill & Elevator Company was and is that of operating a flour mill and elevator, and that speculation on the price of grain was not the business in which said company was engaged, but that McAndrews without any specific authority from the directors, engaged in such speculation in the name of the company, and that no knowledge or notice thereof was possessed by the officers of the company, with the exception of said McAndrews, then and in that event you

are instructed that the contracts by the said McAndrews in the name of the Manchester Mill & Elevator Company were not binding upon said company and you must retur a verdict for the respondent, the Manchester Mill & Elevator Company."

The court refused to give this instruction and defendant assigns this refusal as error. Before considering this specific assignment, we pass to the contention made and argued by counsel that on the facts shown McAndrews had no authority to execute the contracts for the purchase of wheat from the petitioning creditors. While the proof shows that McAndrews was never formally appointed general manager by the board of directors of the company, he was its chief executive officer and acted as general manager, even to the extent of transacting, alone, all the business of the company. The other officers and directors, being farmers, had no experience in such business and took no part in the management of it. They all knew that McAndrews was running the business, and the record shows they acquiesced in his doing so, or at least never objected to it. In this way McAndrews, the president and chief executive officer, was left in sole charge of the business of the company and as such made contracts for and on behalf of the company. The mere fact that he had never been formally appointed or elected general manager, pressed upon our attention by attorneys for plaintiff in error, is of no consequence. He acted as such with the full knowledge of the other officers and directors, and so far as third parties, dealing with the company through him acting within the general scope of his apparent power, are concerned, he must be held to have been acting for the company as its duly authorized agent, and to have bound his company in so doing. In such circumstances, the corporation (on all principles of justice) must be held estopped from denying its liability for his action. Martin v. Webb, 110 U. S. 7, 14, 3 Sup. Ct. 428, 28 L. Ed. 49; Jenson v. Toltec Ranch Co., 98 C. C. A. 60, 174 Fed. 86; Ford et al. v. Hill, 92 Wis. 188, 66 N. W. 115, 53 Am. St. Rep. 902; McKiernan v. Lenzen, 56 Cal. 61, 63; Stokes v. Pottery Co., 46 N. J. Law, 237.

[3, 4] For reasons already stated in discussing the authority of McAndrews to execute the contracts in question, it appears that the facts disclosed by the proof did not warrant the giving of the instruction requested by plaintiff in error and refused by the court. This instruction was predicated upon unproven facts and ignored facts bearing upon the vital issue of the case-whether or not McAndrews was held out as a managing agent in sole charge of the business of the company. Moreover, so far as it contained correct and applicable principles of law, it had been given in the main charge. No error was committed in refusing to give it.

Some other assignments of error, not included in the specification of errors relied upon in their brief, were argued by counsel. To these we have given due consideration, and, finding no reversible error in any of them, the judgment of the District Court must be affirmed.

(231 Fed. 882)

FRIEDERICHSEN v. RENARD et al.*

(Circuit Court of Appeals, Eighth Circuit. March 25, 1916.)

1. APPEAL AND ERROR ENT JUDGES.

No. 4476.

836-REVIEW-CONFLICTING RULINGS BY DIFFER

While the ruling by one District Judge on a question ought as a matter of comity and orderly judicial procedure to be followed by another District Judge sitting in the same case, the failure of the second judge to follow the prior ruling does not affect the power of the Circuit Court of Appeals to review the final judgment.

[Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 32473261; Dec. Dig. 836.]

2. LIMITATION OF ACTIONS

127(12)-COMMENCEMENT OF ACTION—AMENDED

PETITION-NEW CAUSE OF ACTION.

Where a bill to rescind a sale of land for fraud and to recover incidental damages was transferred to the law side of the court under equity rule 22 (198 Fed. xxiv, 115 C. C. A. xxiv), because the plaintiff had put it out of his power to restore the vendor to his former position, an amended petition claiming damages for the fraud, if allowable, set up a new cause of action, and did not relate back to the filing of the original bill, so that it was barred by Rev. St. Neb. 1913, § 7569, where four years had elapsed after the discovery of the fraud before the filing of the amendment.

[Ed. Note. For other cases, see Limitation of Actions, Cent. Dig. § 545; Dec. Dig. 127(12); Pleading, Cent. Dig. § 688.]

In Error to the District Court of the United States for the District of Nebraska; Thomas C. Munger, Judge.

Action by John H. Friederichsen against G. H. Renard, as executor of the estate of Edward Renard, deceased, and others. Judgment for defendants, and plaintiff brings error. Affirmed.

William V. Allen, of Madison, Neb. (William L. Dowling, of Norfolk, Neb., on the brief), for plaintiff in error.

R. E. Evans, of Dakota City, Neb. (W. D. Funk, of Bloomfield, Neb., on the brief), for defendants in error

Before SANBORN and CARLAND, Circuit Judges, and TRIEBER, District Judge.

CARLAND, Circuit Judge. Friederichsen, hereafter called plaintiff, on September 22, 1908, filed a bill in the United States Circuit Court for the District of Nebraska against Edward Renard, in his own right and as agent of Mary C. Gilmore, Mary C. Gilmore, and W. J. Gilmore, hereafter called defendants, for the purpose of having a contract between the plaintiff and Renard, dated March 12, 1908, and a deed executed in pursuance thereof by plaintiff to Renard on March 19, 1908, conveying 240 acres of land in Knox county, Neb., declared null and void, and for damages, for the reason that the plaintiff had been induced by false and fraudulent representations on the part of Renard to enter into the contract and to execute the deed. Renard and Mary C. Gilmore answered the bill. A special master was appointed to take

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes Rehearing denied June 16, 1916.

the evidence, find the facts, and report the same to the court, with conclusions of law. The master heard the evidence and made his report. It appeared from the report that a part of the consideration for the Knox county land conveyed by the plaintiff to Renard was land in Louisa county, Va., that the plaintiff went into the possession of this land and cut down a large amount of timber, and that the sum of $3,050 paid by Renard to plaintiff in connection with the exchange of lands had not been refunded or offered to be returned to Renard by the plaintiff. As a conclusion of law from these facts the master found that there could be no rescission of the contract or a cancellation of the deed. The master, however, found that the plaintiff was entitled to damages in the sum of $5,880. The defendants excepted to the report of the special master and made a motion to set the same aside.

On September 23, 1913, the court (Hon. W. H. Munger, Judge) set the report aside, and claiming to act under equity rule 22 (198 Fed. xxiv, 115 C. C. A. xxiv) ordered the case transferred to the law side of the court, agreeing with the master that there could be no rescission of the contract or cancellation of the deed, but that the case for damages should be conducted as an action at law. The plaintiff did not object in any way to the order of transfer, and on September 25, 1913, filed what is termed in the record an "amended petition at law," wherein the same facts were alleged as constituting fraud as were alleged in the bill, and a judgment for damages was asked. The defendants. moved to strike the amended petition from the files for several reasons, among which was the following:

(9) "Because the cause of action set out in the amended petition is barred by the statute of limitations."

On July 15, 1914, the court (Hon. Smith McPherson, Judge) denied the motions. The defendants then answered the so-called amended petition. Plaintiff then made a motion to strike from the answers certain alleged irrelevant and redundant matter, included in which was an allegation that the action was barred by the statute of limitations. On September 16, 1914, the court (Hon. Smith McPherson, Judge) granted the motion to strike. September 21, 1914, counsel for defendants in open court asked permission to withdraw their answers and file pleas in abatement instanter setting up those things that had been stricken from the answers. The court (Hon. Page Morris, Judge) denied the request. November 4, 1914, the case was moved for trial before Hon. T. C. Munger, Judge, and a jury. The defendants moved that no evidence be allowed to be introduced for the reason among others:

(8) "Because more than four years have elapsed since discovery of the alleged fraud and prior to the filing of the amended petition in this case."

On November 5, 1914, while the case was on trial, it was stipulated that the plaintiff had shown himself entitled to recovery against the defendants if the action had not been barred by the statute of limitations of Nebraska. Thereupon the court took the question as to whether the case was barred under advisement, and March 24, 1915, re