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the object of which is the recovery of damages for wrongs done to them, -as, for instance, where a stockholder and officer
, of a corporation, and a third person, conspire to cripple the corporation by a manipulation of its shares, and the conspir. acy is successful.' For example, a corporation may maintain an action for libel, upon averment and proof of special damages.' This would clearly be true in respect of a slander of its goods or property.
87384. May have Summary Remedies. It has been held not unconstitutional for the legislature to give a summary remedy for the collection of its debts to a corporation created for the public benefit.'
8 7385. Special Statutory Remedies in Favor of Corporations. When it was the fashion to create corporations by special acts of the legislature, special remedies were often accorded to them; but the decisions relating to such remedies may, for the most part, be regarded as obsolete.'
7386. Remedies on Commercial Paper. Some of the cases take this distinction, - that where a corporation has no power to acquire commercial paper, yet, if it does acquire it, it cannot maintain an action thereon, but may maintain an action for money had and received to recover what it gave for the paper. That is to say, while it cannot maintain an action on the instrument which it had no power to take, it can main
· Ilion Bank 9. Carver, 31 Barb. indorser, applied to banks of other (N. Y.) 230.
Stales, - see Lewis v. Bank of Ken• Knickerbocker &c. Ins. Co. 0. tucky, 12 Ohio, 132; 8. C. 40 Am. Dec. Ecclesine, 11 Abb. Pr. (N. 8.) (N. Y.) 469. Construction of Olio statute of 385; 8. C. 42 How. Pr. (N. Y.) 201. 1824 relating to suits where banks
• Bank of Newbern 6. Taylor, 2 are parties: Goodlenow v. Duffield, Murph. (N. 0.) 266.
Wright (Ohio), 455. That a bank * That the Ohio statute of 1844, could not ask the aid of a court of regulating practice in the courts, did equity against a party to a joint and not apply to suits of incorporated several contract before exhausting
- see Clinton Bank v. Hart, legal remedies, see Bank of Chilli19 Ohio, 372, That the statute of the cothe v. Yoe, 4 Ohio, 125. same State, authorizing a joint ac- • Ante, 18 5714, 5744, 5748. tion by a bank against a drawer and
tain an action to recover its money which it had no power to pay out, and which it ought not to have parted with. In other words, it has a right to rescind the ultra vires contract, and to recover what it has lost under it. But the better doctrine is that it can do this only where the other party has successfully avoided his obligation under the contract on the ground of its being ultra vires.
§ 7387. Action by Corporation on Promise Made to its Officer.- Elsewhere we have seen that a deed conveying land to the trustees of a corporation is a deed to the corporation itself.: An analogous rule is that a promise made to the officers of a corporation for its benefit, and upon a consideration proceeding from it, is enforceable in the form of an action by the corporation, -as, for instance, an agreement to pay, to the directors of a corporation, money due to the corporation itself."
$ 7388. Demand in Actions by Corporations. - A corpora
. tion must make demand where an individual must, and need not make demand where an individual need not, prior to bringing and maintaining an action. Demand is generally necessary only where there is a bailment and a custody originally rightful, and where the bailee may justly assume that it is the pleasure of the bailor that his custody of the thing bailed should continue until the contrary is made known to him. It would be justly regarded as a grievance to him if his bailor could make a demand of the return of the subject of the bailment in the first instance by bringing an action to recover it, or to recover damages for its detention. But where the bailee has asserted rights adverse to those of the bailor, this obviously excuses demand. Thus, if the treasurer of a corporation
, receives money belonging to it, and asserts rights thereto
i Waddill v. Alabama &c. R. Co., 35 Ala. 323. Compare Phelps v. Masterton &c. Stone Dressing Co., 3 Rob. (N. Y.) 517. ? Ante, $ 6004.
8 Ante, $ 5113. Compare ante, $ 5038.
• Thompson v. Marion &c. Gravel Road Co., 98 Ind. 449.
inconsistent with the right of the corporation to demand the same, and makes charges in the corporate books in extinguishment of his obligation to pay over the money to the corporation, a demand is not necessary before suit brought by the corporation to recover the money.'
ARTICLE III. WHAT ACTIONS LIE AGAINST CORPORATIONS. SECTION
SECTION 7391. What actions will lie against 7406. Actions for violations of public corporations.
duties. 7392. When assumpsit will lie against 7407. Specific performance. corporations.
7408. Mode of compelling perform7393. When noto
ance of agreement to arbi7394. Trespass.
trate. 7395. Case.
7409. Bills in equity for discovery. 7396. Trover.
7410. Mode of procedure to compel 7397. Replevin.
discovery in equity. 7398. Ejectment.
7411. Further of this subject. 7399. Forcible entry and detainer. 7412. Statutory substitutes for dis7400. Slander - Libel — Slander of
7413. Bill of interpleader by agent of 7401. Book account.
corporation. 7402. Account stated.
7414. Actions to recover payments 7403. Use and occupation.
voluntarily made. 7404. Actions on clauses of charter. 7415. Demand in actions against cor7405. Actions on by-laws.
§ 7391. What Actions will Lie against Corporations. – Without going into the ancient history of this subject, it may be said here that it is settled that where the law imposes an obligation upon a corporation, which it fails or refuses to discharge, it may be held civilly liable therefor, at law or in equity, in any appropriate form of action where the system of common-law pleading prevails, and on appropriate allegations and proofs, under the system of equity and under the codes.?
8 7392. When Assumpsit will Lie against Corporations. Thus, although there are some ancient and untenable hold
1 East New York &c. R. Co. v. tion to an action by one sustaining Elmore, 5 Hun (N. Y.), 214.
damage in consequence of its failure to ; For a general statement of the discharge a duty imposed by law, - see doctrine of the liability of a corpora- Seagraves v. Alton, 13 Ill. 366.
ings to the contrary,' a corporation may now be sued in assumpsit on express or implied promises, in the same manner as an individual. This action will lie against it for refusing to permit a transfer of its shares upon its books, at the suit of a person lawfully entitled to demand the same;' or upon a refusal of the corporation to permit a stockholder to subscribe for additional stock to which he is entitled. So, if a railroad corporation occupies land after its agent has been notified by the owner that rent will be charged, it is liable in assumpsit for use and occupation.3
§ 7393. When not. Covenant, and not assumpsit, being the form of action at common law upon a sealed instrument,
1 Breckbill v. Lancaster Turnp. Co., 3 Dall. (U. S.) 496; Frankfort Bank v. Anderson, 3 A. K. Marsh. (Ky.) 1. An exception to this rule was admitted where a local act authorized a corporation to make promissory notes: Slark v. Highgate Archway Co., 5 Taunt. 792. But all American corporations have this power, unless it is prohibited to them: Ante, § 5730.
• Rex v. Bank of England, 1 Doug. 524; Davis v. Georgetown Bridge Co., 1 Cranch C. C. (U. S.) 147; Gray v. Portland Bank, 8 Mass. 364, 382; 8. c. 3 Am. Dec. 156; Worcester Turnp. Co. v. Willard, 5 Mass. 80; s. c. 4 Am. Dec. 39; Mechanics' Bank v. Bank of Columbia, 5 Wheat. (U.S.) 326; Bank of Metropolis v. Guttschlick, 14 Pet. (U.S.) 19; Kortright v. Buffalo Commercial Bank, 20 Wend. (N. Y.) 91; 8. c. 22 Wend. (N. Y.) 348; 34 Am. Dec. 317; Foster v. Essex Bank, 17 Mass. 479, 503; 8. c. 9 Am. Dec. 168; Sargent v. Franklin Ins. Co., 8 Pick. (Mass.) 90, 98; 8. c. 19 Am. Dec. 306; Poultney v. Wells, 1 Aiken (Vt.), 180; Gassett v. Andover, 21 Vt. 342; Stone v. Congregational Society, 14 Vt. 86; Antipoeda Baptist Church v. Mulford, 8 N. J. L. 182; North Whitehall v.
South Whitehall, 3 Serg. & R. (Pa.) 117; Chestnut Hill Turnpike v. Rutter, 4 Serg. & R. (Pa.) 6, 16; s. c. 8 Am. Dec. 675; Dunn v. St. Andrew's Church, 14 Johns. (N. Y.) 118; Danforth v. Scoharie &c. Turnp. Road, 12 Johns. (N. Y.) 227, 231; Bank of Columbia v. Patterson, 7 Cranch (U.S.), 299; Waring v. Catawaba Co., 2 Bay (S. C.), 109; Hayden v. Middlesex Turnp. Corp., 10 Mass. 397; 8. c. 6 Am. Dec. 143; Proctor v. Webber, 1 D. Chip. (Vt.) 371, 456, note; Chesapeake &c. Canal Co. v. Knapp, 9 Pet. (U. S.) 541; Hunt v. San Francisco, 11 Cal. 250; Cape Sable Co.'s Case, 3 Bland (Md.), 606; Seagraves v. Alton, 13 Ill. 366.
• Rex v. Bank of England, 1 Doug. 508, 524; Kortright v. Buffalo Commercial Bank, 20 Wend. (N. Y.) 91; 8. c. affirmed, 22 Wend. (N. Y.) 348; 34 Am. Dec. 317; Sargent v. Franklin Ins. Co., 8 Pick. (Mass.) 90; s. c. 19 Am. Dec. 306; ante, § 2462.
♦ Gray v. Portland Bank, 8 Mass. 864; 8. c. 3 Am. Dec. 156.
Illinois Cent. R. Co. v. Thompson, 116 Ill. 159. That a corporation must first be put in default before it will be liable upon an implied contract, Seagraves v. Alton, 13 Ill. 366.
assumpsit cannot be maintained against a corporation upon a written agreement to which the agent of the corporation has put a seal, though not the common seal of the corporation. Such an instrument is nevertheless the deed of the corporation. But the scroll or private seal of the chief engineer of a railroad corporation affixed to a contract is not the seal of the company, and will not make the contract a specialty, so as to prevent assumpsit against the company for its breach.
§ 7394. Trespass.-It being settled in the modern law, contrary to earlier opinion, that a corporation can commit trespass, both upon person and property, through its agents acting in its behalf, it follows that where the common-law system of pleading prevails, an action of trespass will lie against a corporation for a direct injury done within the general scope of its corporate powers. The doctrine applies equally to municipal corporations, and, in Illinois, to towns organized under the township law; but with this limitation, that the act complained of must have been such as might have been lawfully accomplished had the municipal authorities proceeded according to law; since where the act complained of lies wholly outside of the general or special powers of the municipal corporation, it can in no event be liable."
Porter. Androscoggin &c. R. M'Cready v. Guardians of the Poor, Co., 37 Me. 349. 9 Serg. & R. (Pa.) 94; s. c. 11 Am. Dec. 667. That an action of trespass, for assault and battery, will lie against a railroad company,- see St. Louis &c. R. Co. v. Dalby, 19 Ill. 352; ante, §§ 6304, 6306.
Allen v. Decatur, 23 Ill. 332; 8. c. 76 Am. Dec. 692; Chicago v. McGraw, 75 Ill. 566, 570; Sheldon v. Kalamazoo, 25 Mich. 387; Chicago v. Turner, 80 Ill. 419, 420.
Wolf v. Boettcher, 64 Ill. 316,
Chicago v. Turner, 80 Ill. 419,
Saxton v. Texas &c. R. Co., 4 N. M. 201; s. c. 16 Pac. Rep. 851. Compare ante, § 5053.
Ante, § 6302.
• Ante, § 6303.
Lyman. White River Bridge Co., 2 Aiken (Vt.), 255; 8. c. 16 Am. Dec. 705; Whiteman v. Wilmington &c. R. Co., 2 Harr. (Del.) 514; s. c. 33 Am. Dec. 411; Underwood v. Newport Lyceum, 5 B. Mon. (Ky.) 129; I. c. 41 Am. Dec. 260; Hopkins v. Atlantic &c. Railroad, 36 N. H. 9; &. c. 72 Am. Dec. 287, 292; Crawfordsville &c. R. Co. v. Wright, 5 Ind. 252;