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SHIPPING.

Contributory negligence is not a bar to a suit in the admiralty for damages arising from personal injury; the fault of the seaman must not be overlooked and may deprive him of general damages, but under the circumstances of each case, partial or special compensation will be allowed; hence, when a mate was coaling a tug in the usual way with a barrow which was liable to make him lose his balance and fall from the gang plank, and this occurred with the result of a fracture of his leg, the injured man was awarded his wages for the time he was in the Marine Hospital, being gratuitously treated: Olson v. Flavel, U. S. Dist. Ct. Oregon, March 31, 1888.

Maritime lien for supplies furnished to a vessel at her home port, cannot be implied, as such supplies are presumed to be furnished on the credit of the owner in the absence of a contract for an express lien: Mayo et al. v. The Chelmsford, U. S. Dist. Ct. E. D. Penna., February 27, 1888.

TRADEMARK.

Accounting will be refused, in an equity suit for an infringement of a trademark, where there is no fraud and the trade generally have used the trademark for nearly four years: Low et al. v. Fels, U. S. Circ. Ct. E. D. Penna., April 20, 1888.

TELEGRAPHS.

Printed agreement on a night message blank, "that the sender will agree that he will not claim damages for errors or delays, or for nondelivery of such messages, happening from any cause, beyond a sum equal to ten times the amount paid for transmission," is void, as against public policy: Fowler et al. v. West. U. T. Co., S. Jud. Ct. Me., June 6, 1888.

Fire, at a repeating station, caused by atmospheric conditions, short circuiting the currents on the switch-board, being impossible to prevent, is a sufficient excuse for the non-delivery of a message; here, the operating-room was destroyed before anything could be rescued, and the message was never delivered, but no recovery could be had against the company: Id.

TRUSTS.

Mortgagor styled in the bond and mortgage as "trustee," and signing with that addition to his name, is, nevertheless, personally responsible for a deficiency on a sale of the mortgaged premises, unless there are facts which show a waiver of the mortgagee's right: McDowall v. Reid, 28 S. C. 466.

Power of appointment over an estate, real and personal, in remainder, given by a testatrix, domiciled in South Carolina, to be exercised by her daughter's will, "duly executed," can only be exercised by a will executed according to the requirements of the South Carolina

law; the daughter's will being executed according to the laws of another State, where she was domiciled, and duly admitted to probate, and an exemplification filed in South Carolina, was not a valid exercise of the power unless the laws of the daughter's domicile and those of South Carolina were alike in their requirements for due execution of a will: Blount v. Walker, 28 S. C. 545.

TURNPIKES.

Toll-gate keeper may close the gate to prevent a threatened passage of the gate, without paying toll, by a team lashed by its driver, unless the rapidly approaching team is so near as to render the closing of the gate a reckless disregard for the safety of the parties trying to evade payment of the toll: Brannen v. K. G. & J. G. R. Co., S. Ct. Ind., May 29, 1888.

U. S. COURTS.

Claims against the United States, over which the U. S. Circuit Courts are given jurisdiction by Act of 1887 (24 Stat. 505), include claims by a purchaser of timber lands, under Act of 1878 (20 Stat. 89), or his assignee, to have a patent issued for the same: James v. United States, U. S. Circ. Ct. Dist. Oreg., July 16, 1888, 35 Fed. Rep. 561.

Non-resident alien has the personal privilege, under § 1, Act of March, 1887, to plead in abatement in an original, or move to remand on a removal, that he is not a resident of the district where the civil action has been brought; but his opponent may not use this objection to procure a remand to the State Court after the alien has removed the case; residence is not a jurisdictional fact: Cooley v. McArthur et al., U. S. Circ. Ct. E. Dist. Mich., July 2, 1888.

Removal papers of an action from a State Court, on the ground of citizenship, must show the ground of jurisdiction in the Circuit Court, as there is no precedent known which would authorize the showing, after removal, of grounds for jurisdiction not presented to the State Court: Cameron v. Hodges, S. Ct. U. S., April 30, 1888, 127 U. S. 322.

WRITING.

Printing is writing in the legal sense of the term, and an instrument whose words are printed, either wholly or in part, is equally valid with a paper written with a pen: In re Benson, U. S. Circ. Ct. S. Dist. N. Y., April 9, 1888.

Signature by impression from a stamp is valid at common law: Id.

JOHN B. Uhle.

THE

AMERICAN LAW REGISTER.

NOVEMBER, 1888.

THE ILLEGAL ISSUE AND OVER-ISSUE OF
CAPITAL STOCK OF CORPORATIONS.

THE Conception of a corporation was taken from the civil law. The susceptibility of corporations to fraud and perversion was soon recognized, so that at the civil law under the empire a special permission from the State for their creation became necessary, and by the pagan emperors was granted with great reluctance: Taylor on Corp. § 4. At the common law a corporation could never be created like a partnership, merely by a contract between the individuals composing it. The right of acting in a corporate capacity is a special privilege, which may not be assumed without authority from some governing power: Morawetz on Pri. Corp. § 4; State v. Bradford, 32 Vt. 53. The necessity for these restrictions is occasioned principally by the limited liability of the corporators, and therefore the capital stock, the sole fund to which creditors have recourse, as well as being a favorite subject for investment, is hedged in, jealously, by statutory restrictions.

What is the effect of the illegal creation of certificates of stock by agents of a corporation, who covinously and secretly issue such certificates?

The solution of this question is dependent, in part, upon that of another, which is as to the extent of the liability of a corporation for the acts of its agents. The Maryland Court of Appeals, in Tome v. Parkersburg Branch R. R., 39 Md. 71, adopt the language of Story on Agency, § 452: "It is a gen

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eral doctrine of law, that, although the principal is not ordinarily liable in a criminal suit for the acts or misdeeds of his agent, unless, indeed, he has authorized or co-operated in those acts or misdeeds; yet he is liable to third parties in a civil suit for the frauds, deceits, concealments, misrepresentations, torts, negligence, and other malfeasances or misfeasances and omissions of duty of his agent in the course of his employment, although the principal did not authorize, or justify, or participate in or indeed know of such misconduct, or even if he forbade the acts or disapproved of them. In all such cases the rule applies respondeat superior; and it is founded upon public policy and convenience." The Court go on and quote: "As natural persons are liable for the wrongful acts and neglects of their servants and agents, done in the course and within the scope of their employment, so are corporations, upon the same grounds, in the same manner, and to the same extent: Ang. & Ames on Corp. § 310 ; Albert v. Savings Bank of Baltimore, 1 Md. Ch. 407; Thatcher v. Bank of N. Y., 5 Sand. 121; Thompson v. Bell, 10 Exch. 10; Bargate v. Shortridge, 5 H. of L. Cas. 297; National Exchange Bank v. Drew, 32 Eng. Law & Eq. 1; Stevens v. Boston and Maine R. R., 1 Gray, 277; Blackstock v. N. Y. and Erie R. R., 1 Bosw.

77.

In the case of the Western Md. R. R. v. Franklin Bank, 60 Md. 43, ALVEY, C. J., says, "Strictly speaking, corporations while acting within the scope of the powers delegated to them, cannot be guilty of wilful fraud, yet it is settled by a great number of decided cases, that corporations carrying on trade or business of any kind, are equally and to the same extent liable for the frauds and wrongs of their agents, perpetrated in the course of their employment, as individual principals would be under like circumstances: Story, § 452; Grammer et al. v. Nixon, 1 Strange, 653.

In causes of action arising out of tort, the doctrine of ultra vires is inapplicable. "A great distinction exists between tortious and contractual liability for acts ultra vires. It is no defence to legal proceedings in tort, that the torts were ultra vires. If the torts have been done by the corporation or by their direction, they are liable for the results, however much

in excess of their powers such torts may be:" Green's Brice's Ultra Vires, 265; Sharp v. Mayor, 40 Barb. 277; Taylor on Corp. § 338; Alexander v. Reefe, 74 Mo. 495. This distinction, with the reason therefor, is succinctly stated in the recent case of Salt Lake City v. Hallister, 118 U. S. 263. "It remains to be observed that the question of the liability of corporations on contracts which the law does not authorize them to make and which are wholly beyond the scope of their powers is governed by a different principle. Here the party dealing with the corporation is under no obligation to enter into the contract. No force, or restraint, or fraud is practised on him. The powers of these corporations are matters of public policy, open to his examination, and he may and must judge for himself as to the power of the corporation to bind itself by the proposed agreement." The reports are full of cases to this effect: Phila. Wil. and Balto. R. R. v. Quigley, 21 How. 202; Carter v. the Howe Machine Co., 51 Md. 290; Balto. & Yorktown Turnpike Co. v. Boone, 45 Md. 344; Cook on Laws of Stock and Stockholders, § 293; Paley on Agency, §§ 294-6. Even malice has been imputed to them and exemplary damages allowed; cases cited supra, and Phila. Wil. etc. R. R. v. Larkin, 47 Md. 155; Same v. Hoeflich, 62 Id. 300.

Attention, however, must be directed to the decision of the English Court of Appeals in the case of British Banking Co. v. Charnwood Forest R'y, etc., L. R. 18 Q. B. Div. 714 (1887), overruling the decision reported in 34 Weekly Rep. 718. It was an action brought to recover damages for fraudulent misrepresentations alleged to have been made by the defendant corporation through their secretary. It appeared at the trial, that certain customers of the bank had applied to them for an advance on the security of transfers of debenture stock of the defendant company. The plaintiff's manager called upon T., the defendant's secretary, and was informed in effect that the transfers were valid, and that the stock which they purported to transfer existed. The plaintiff thereupon made the advances. It subsequently appeared that T., in conjunction with one M., had fraudulently issued certificates for debenture stock in excess of the amount which the company were authorized to issue, and the transfers concerning which

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