73 So. 918 | Ala. | 1916
Lead Opinion
(1, 2) It was formerly supposed that a corporation could not enter into a contract except by attaching the corporate seal to the contract itself, but the modern rule is that the corporate seal need not be attached to a corporate contract unless a similar contract, when made by an individual, would require a seal. — 3 Cook on Corporations, § 722. This rule applies to the method of executing the contract; that is, if the contract must be under seal, it must have the seal of the corporation attached in the execution of same, but does not necessarily mean that the officer or agent of the corporation, who executes the contract, can only derive his right or authority to do so under a sealed instrument, and in this respect there seems to be a distinction between the method of delegating authority to an agent between an individual and a corporation. An individual in delegating to another the authority to execute instruments must do so by an instrument of similar importance and dignity as characterized, the instrument to be executed, but not necessarily so with a corporation.
“It is a general rule of law applicable to natural persons that, whenever the act of agency is required to be done in the name of the principal under seal, the authority to do the act must be conferred by an instrument under seal. Such was formerly the doctrine in regard to the authority of agents of corporations. But in modern times this ancient rule has been wholly discarded, in this country, and it is now well settled that an agent of a cor
A corporation can only act through agents. If De Bows’ authority to execute a sealed instrument could have come only by a sealed instrument, who was there to give him such authority ? The agent of the corporation executing the power of attorney, if the contention of the appellant is sound, must himself have been authorized by a writing under seal. It is a common practice for officers and agents of a corporation to execute instruments under seal and of the most solemn character without any other or further authority for doing so than a simple resolution of the board of directors of the corporation. We do not overlook the authorities cited and relied upon by appellant’s counsel, but not one of them hold that the delegation of the authority to the ■agent to execute a sealed instrument for a corporation must be under seal. They simply hold that the execution of the instrument, if required to be under seal, must be under the seal of the corporation, or that the delegation of the authority by an individual must be under seal; but none of them hold that a corporation cannot delegate the authority except by an instrument under seal, and, as above noted, the law recognizes a distinction in this respect between individuals and corporations.
(3) As the delegation of the authority need not necessarily be by a sealed writing, a ratification of an agent’s act in signing a bond need not be by a sealed writing, though we do not wish to be understood as holding that every valid ratification must be of the same character and solemnity as would be essential to the original authorization.
(4, 5) It may be conceded that the authority to De Bow and Webb jointly to make bonds for the appellant company did not authorize them to do so singly. It may also be questionable as to whether or not authority was shown giving Martin and Forbes the power to authorize De Bow to make bonds for the company, yet the evidence shows that the appellant company ratified the execution of the bond in question, and this was done after the withdrawal of the authority from De Bow and Webb of October 23d, and the recordation of same on the 29th. De Bow testified
(6) Of course, the acceptance of the consideration of an unauthorized contract, without knowledge of the terms of the contract or of the account upon which it is predicated, is not itself a ratification of the contract, but the proof in the case at bar shows that the appellant had full notice of the bond, and that the premium of $20, retained by it for two months, was collected for the making of said bond by it through De Bow, who was its agent, whether he did or did not have express authority to execute said bond for this appellant.
(7) There are but few objections to the evidence relating to the ratification features, and in them there was no reversible error. The other objections related to an effort to establish original authority in the agent De Bow, and as we hold the appellant liable upon a ratification, rather than on an original authorization, the rulings were harmless, if errroneous.
The judgment of the circuit court is affirmed.
Affirmed.
Rehearing
Upon a reconsideration of this ease, we find that the statement in the opinion that the premium on this particular bond was remitted to the appellant company, together with a copy of the bond within a few days after the execution of same by De Bow, is inaccurate. As a matter of fact, the premium was not remitted until later when it was sent in together with other premiums and accompanied by a general statement of the business covered by said statement. The witness De Bow did testify however: “They would be informed of the execution of the bond in the regular order of business, maybe a day or two or three days; as soon as they could be made up. They were furnished with copies of all papers in the case.”
Again the witness was asked: “How soon after the 30th day of November, 1912, was the Alabama Fidelity & Casualty Company informed of the execution of the bond that is involved in this suit?”
The witness replied: “I have not a record of the exact date it went to them, but probably not over four or five days at the outside.”
It therefore appears that although a general statement was not furnished, and that the premiums were not sent in until later, that a copy of this identical bond was furnished the appellant within three or four days after the same was executed on November 30th. The receipt of said copy was not denied, and the trial court could have well inferred that the appellant had notice of the execution of this bond for nearly two months before attempting to repudiate same. Moreover, the trial court saw and heard the witnesses, and we are not prepared to say that the conclusion was plainly and palpably wrong.
The application for rehearing is overruled.
