95 N.J.L. 405 | N.J. | 1921
The opinion of the court was delivered by
This is an appeal from each of three judgments in the Supreme Court recovered by the above-named plaintiff in three actions at law brought in the Supreme Cffurt tried at the Bergen Circuit before Judge Cutler and a jury: The cases, which arose out of the same accident, were tried together and involve common questions of law and fact. All of the questions raised on. these appeals apply equally and the same to each of the three cases, ^ere ai’gued together and will be so decided.
The facts appearing from the evidence are as follows: On April 25th, 1919, the plaintiff, Teresa C. Frawley, John F. Frawley, her husband, and Vincent C. Frawley, her son, were passengers in a jitney bus which collided with another jitney bus on Jay street, in the borough of Tenafly, and in the collision each of the persons named sustained serious injuries, as a result of .which John F. Frawley and Vincent C. Frawley died, and the three suits- were instituted by Teresa C. Fraw-ley, individually, for personal injuries sustained by her, one by the same Teresa C. Frawley, as administratrix ad prose-quendum of 'her deceased husband’s estate, and one by the same .Teresa C. Frawley, as administratrix ad prosequendum of her deceased son’s estate.' Both of the jitney buses which figure in the accident had the same ownership, but in whom the title was vested or who employed the chauffeurs, of. the-buses at the time of the accident are questions which were sub-
When the testimony was all in and the case rested, a motion, was made for a, nonsuit on behalf of the defendant company, upon the ground that its corporate existence at the time of the accident had not been proved, and upon the further ground that the ownership and operation of the buses at that time had not been proved. This motion' was denied A motion was then made to nonsuit on behalf of the defendant Harry Sabin. Plaintiff’s counsel conceded that nothing had been shown against him- and consented to the nonsuit, which was ordered entered. Motion was then made to nonsuit as to llie other three defendants, namely, Rothbart, Capitani and Shiffman, on the ground that the evidence did not show any
The trial judge charged the jury that they should find what party was liable, whether the corporation or the individual defendants. The verdicts as rendered hy the jury do not appear in the state of the case. The pos Lea in each case recites that the jury rendered a verdict against the defendant, Tenafly Transportation Company, Incorporated, and in favor of the plaintiff, for the amount named in it. It may be presumed that they found in favor of the individual defendants.
On April 2d, 1919, the buses in question were owned by the New Jersey Transportation Company, and, on that day, were sold to the four individuals above named. They commenced the operation of the buses in their business. On April 9th, 1919, they applied to the borough of Tenafly, in the name of the Tenafly Transportation Company, Incorporated, for an owner’s license for the two buses in question, and filed with the borough an insurance policy in the name of the corporation, pursuant to the provisions of a borough ordinance, agreeing therein to operate the buses in strict conformity with the provisions of the ordinance. This application was granted on April 10th, 1919. On April 11th they applied for and obtained from the authorities at Camp Merritt- a
The grounds of appeal, which are the same in each case, are (1) because the court failed and refused to grant the motion for nonsuit made by the defendant at the close of the plaintiff's case; (2) because the court failed and declined to direct a verdict for the defendant, Tenafly Transportation Company, Incorporated, in accordance with the motion of the defendant at the' close of the evidence in the trial of the case. The third, fourth and seventh grounds of appeal are abandoned, and appear to be covered in the fifth and sixth grounds. The latter two pertain to the charge of the trial judge.
As to the question of 3e facto corporation, which is the principal ground involved in the motion to nonsuit and direct a verdict. By our act concerning corporations (Rev. 1896; Comp. Stat., p. 1595, § 10) it is provided that upon making the certificate, of incorporation and causing the same to be recorded in the office of tire county clerk and filed in the office of the secretary of state, the persons so associated, their successors and assigns, shall from the date of such filing be and constitute a body corporate. It is argued from ibis that the corporation defendant was not a body corporate on the day of the accident because its certificate was not recorded in the county clerk's office until the day afterward, and not filed in the secretary of state’s office until four days afterward. The answer is, that it was, nevertheless, a de facto corporation.
In Vanneman v. Young, 52 N. J. L. 403, a certificate, of incorporation was recorded in the county clerk’s office but was not filed in the secretary of state’s office until upwards of eight months afterward. In the interim between the recording- and filing of the certificate the corporation purchased
‘‘The statute above mentioned authorized the incorporation of the associates. The bona fieles of their attempt to incorporate themselves in accordance with its provisions is unquestioned, and the contract of the plaintiff was entered into upon the assumption that he was dealing with a corporation de jure. The failure of the associates to observe exactly the directions of the statute did not in the least impair the rights which tile plaintiff intended to secure by his contract. Under these circumstances, the plaintiff cannot bring into question the legality of the incorporation.
“ ‘Where the law authorizes a corporation, and there is an effort in good faith to organize a corporation under the law, and. thereupon, as a result of such effort, corporate functions are assumed and exercised, the organization becomes a corporation de fado, and, as a general rule, the legal existence of such a corporation cannot be inquired into collaterally, although some of the legal formalities may not have been complied with. ' Ordinarily, such an inquiry can only be made in a direct proceeding brought in the name of the state. * * * No private person having dealings with a de facto corporation can 1)0 permitted to say that it is not also a corporation de jure.' ” Citing cases.
ft is true fliat the court then observed that the recording and filing of the certificate are not made by the statute a condition precedent to the legal existence of the corporation; that they are merely necessary evidence of such existence, that evidence being produced, the legal existence of the corporation from the time of commencement fixed in the certificate was proved.
In McCarter v. Ketcham, 72 N. J. L. 247, it appeared that on a day while the earlier Corporation act was in force,, certain persons signed a certificate of incorporation, held the first, meeting, elected officers, and did business. The certificate was filed in the county clerk’s, office, hid was never filed in the secretary of state’s office; and yet this court held (at p. 253) :
“The company was a fully organized, active corporation de facto. It needed only the filing of its certificate in the office*414 of the secretary of state to be a corporation de jure. When the corporations purchased from Holloway property which Holloway’s creditors might reach, the rights of outside persons intervened, and the original stockholders and incorpora-tors could not end the corporation by agreement among themselves to abandon the enterprise or by destroying the certificate of incorporation. Bibb v. Hall, 101 Ala. 79; Aultman v. Waddle, 40 Kan. 195.”
And this in.the face of the statute in existence at the time 'of the decision of the Vanneman case, which, as seen, provided that the company should become incorporated upon making, recording and filing its certificate.
In Belvidere Water Co. v. Belvidere, 82 N. J. L. 601, it was held (at p. 603) :
“The question, therefore, is whether this action is maintainable in the name of the Belvidere Water Company. This depends not upon the de jure but upon the de facta existence of such corporation at the time suit was brought.”
The only remaining question on this score is as to whether the facts in evidence justified the jury in finding the corporation defendant liable, and their verdict against the defendant corporation amounted to such finding. It included a finding that the three individual defendants.had attempted bona fide to form a corporation and that they had likewise done acts which amounted to the exercise of corporate powers. There was evidence from which tire jury could draw these conclusions, and it is settled law that on appeal to this court if there be any evidence warranting the finding of facts in the court below, its judgment on that score will be sustained. The bill of sale for the buses in question made by the individual defendants to the defendant company, and their operation by that concern as a de facto■ corporation, dispose of the contention that there was no proof to show ownership- of the machines by the company. Therefore, the overruling of the motions to 'nonsuit and direct a verdict was right. This leaves only the fifth and sixth grounds of appeal, pertaining to the charge of the court, to be considered.
5. Because the court charged the jury, in part, as follows:
“Before the plaintiffs in this case can recover against this corporation, they must show that after they had become a de facto corporation by signing the paper, they had gone further than that, they had done some act in the use of that corporation. Now, what had they done ? That is for you, gentlemen, to say, whether there has been.”
The next ground, which concerns the charge delivered to the jury when called back by the court, is so entirely related to the preceding one that they will be considered together. It is:
6. Because the court charged the jury, in part, as follows:
“Gentlemen, counsel seem to have the impression that in my charge I intimated to you, or said to you, that the signing of the certificate of incorporation constituted and made these defendants a de facto corporation. That is an element to be considered, but it does not constitute them a de, facto corporation unless, after they had taken that step, they did some act that they would have a right to do, if they had been a legal corporation. And that, gentlemen, is one of the questions for you to determine, whether, after the 22d or 23d of April, when this certificate was signed, this corporation, or these defendants, considering themselves such a corporation, did any corporate act that would show that they were using the corporate powers which they had attempted to assume.”
Together and in effect these excerpts from the charge gave the jury to understand that the mere signing of the certificate of incorporation by the associates did not constitute them a de facto corporation, but that, for the company to have that character, the corporators must go further and do some corporate act or acts in attempted execution of the powers conferred by the certificate of incorporation. And this was right, as appears from the cases above cited. Furthermore,. it was favorable to the defendant.
The views above expressed lead to an affirmance of the three judgments under review.