Cincinnati Cooperage Co. v. Bate

| Ky. Ct. App. | May 8, 1894

JUDGE HAZELB.IGG

delivered the opinion op the court.

The conclusions of fact certified by the court below in this case are that “The New Albany Brewing Company was a corporation duly created and organized under the laws of the State of Indiana for the purpose of manufacturing and vending beer. It was incorporated under the corporate name of the ‘New Albany Brewing Company.’ Afterwards, the defendants, E. R. Bate, J. Grebhart and another, acquired the entire stock of the New Albany Brewing Company, and became its directors. Bate, Grebhart and another, as directors and stockholders, without taking any steps required by the law of Indiana in such cases provided, changed the name of the ‘New Albany Brewing Company’ to the ‘Grebhart & Bate Brewing Company,’ and thereafter the business of the New Albany Brewing Company was conducted under the name of the Grebhart & Bate Brewing Company, and the business under the latter name was conducted at the same place, and in its conduct was used the same property, appliances and machinery. The draft sued on was drawn and accepted after the change of name of said corporation as aforesaid, and whilst the defendant, E. R. Bate, was a holder and owner of stock and a director of the corporation.”

The court found as a matter of law that Bate was not liable individually on the draft, nor liable thereon ■as a partner. The contention of the appellant is that Bate and the other owners of the old concern having •abandoned the corporate name and adopted a new name, which gave special prominence to the names -of the individuals composing the concern, are individually liable as partners in a venture, for the reason that no legal steps were taken to change the corporate name as might have been done under the easy mode provided by the Indiana statute.

It is evident, at the 'outstart, that if there are any adjudications in point by the Indiana courts, they must be given a controlling influence, and we are referred to the case of Coleman v. Coleman, 78 Ind., 344" court="Ind." date_filed="1881-11-15" href="https://app.midpage.ai/document/coleman-v-coleman-7044638?utm_source=webapp" opinion_id="7044638">78 Ind., 344. The court says: “Waiving all consideration of the doctrine of estoppel contended for, and conceding that there was no corporate body for which the appellees were authorized to act, * * still, if the company was not a corporate body, then it was a partnership, composed not merely of the directors, but of all the subscribers to the articles of incorpotion.”

That the Gfebhart & Bate Brewing Company was a corporate body can not be maintained in the face of the record to the contrary. The parties assuming to ■do business as such company did not take a single step required by the statute for the purpose of creating a corporation or of changing the name of the old corporation. The name of. a corporation is “the very being of its constitution, the knot of its combination, without which it could not perform its corporate functions.” (Smith’s Mercantile Law, 3d edition, 141.)

“When a corporation is created, a name must be given to it, and by that name alone must it sue and be sued and do all legal acts.” (1 Blackstone’s Com.,, 474.) '

“The law knows a corporation only by its corporate name.” (Walker’s American Law, 9th edition, 232.)

“A corporation has no right or power of itself to change or alter the name originally selected by it without recourse to such formal proceedings as are prescribed by law.” (Beach on Private Corporations, section 275.) The effect of such change of name is an abandonment not only of the corporate name, but of the corporation itself. The identity of the creature authorized by the statute to do business is destroyed. It is in no sense like the case where an individual changes his name. The very being of its constitution is destroyed by an abandonment of its name and an attempted substitution of a new name without authority of law. In the case of Fuller v. Rowe, 57 N. Y., 26, it was-, said: “Parties assuming to act in a corporate capacity without a legal organization as a corporate body, are liable as partners to those -with whom they contract.” In Robinson v. Harris, 5 Ky. L. Rptr., 928" court="Ky. Ct. App." date_filed="1884-05-03" href="https://app.midpage.ai/document/richardson-v-hunt-7156696?utm_source=webapp" opinion_id="7156696">5 Ky. Law Rep., 928, it was held that the corporate existence of associations provided for in chapter 56, General Statutes, depends upon and begins only after the terms of the law are substantially complied with and until the notice required by section 5 has been published, the association has no right to begin business as a corporation, and because such notice had not been published, the members were held liable as. individuals. We concur in the conclusions reached by the Superior Court in this case, that “The Gebhart & Bate Brewing Company had no right to do business as a corporation until the members had complied with the law. Until they did so, no corporation existed. The stockholders were merely doing business as partners, and, as such, are individually liable for the debts.”

Judgment reversed and cause remanded for proceedings conformable to this opinion.