Newton Manufacturing Co. v. White

| Ga. | Jan 15, 1871

Lochrane, C. J.

This was án action brought by the Whites against the plaintiff in error, for the recovery of certain cotton, alleged to have been received by them under contract. The record is volum'i%>us and embraces the evidence of many witnesses upon questions of fact, found by the jury. We do not propose to review the testimony, as the controlling question of the case turns upon the law governing corporations, and its application to the theory of defense relied on by the defendant below.

The action was brought in the ordinary form of assumpsit, to the March Term of Newton Superior Court. The return of the sheriff upon the 26th February, 1867, is “ I have this day served Newton Manufacturing Company with a copy of this writ, by leaving it at their most notorious place of business.” At the proper term the defendant appeared by counsel and pleaded the general issue. Upon these pleadings the case went to the jury, and a verdict was found for the plaintiff. An appeal was entered, and when the case came on for trial, the defendant pleaded “ that at the time of the several supposed promises and undertakings, etc.: to wit: in the year 1865, and for several years previous thereto, to wit: the year 1861, the defendant was not using or exercising any of the franchises conferred by its charter, that it had no officers or agents, appointed in accordance with its by-laws, and was not capable of making contracts or performing any of the functions of its corporate existence, but on the contrary was dormant or in a state of suspension,” etc. The Court below held that this plea was filed too late, and disallowed any evidence under it, showing, as a corporation, it was incapable of making the contract or was not operating within the forms of a charter.

The jury found for the plaintiffs, and a motion for a new trial, on several grounds, was made and overruled by the Court, and the case comes before us by exceptions to the judgment of the Court refusing a new trial.

This corporation was created under the Act of 1847, Cobb’s Digest, 439, and is found under the classification of “Joint Stock Companies.” The parties, associating under this general Act of the Legislature, as the “ Newton Manufacturing Company,” it appears by the record, originally consisted of eight persons, who published, by requirement of the law, their association. In this manner the company began business, and W. R. Phillips in 1863, by purchase of the stock, became exclusive owner and controlled the Factory. Did this concentration of the stock in the hands of one single owner destroy the corporate rights and franchises of the “ Newton Manufacturing Company ?” Under the peculiar character of this association, under the law, we do not feel authorized to hold that such a purchase necessarily destroyed the franchise ; the object of the association was to carry on business under a corporate name ; and when we find that the business was continued under that name, no matter whether there was one or oue hundred owners of stock, the corporate name was equally within the power of the one as of the one hundred to use and to carry on the business. Nor was it necessary that by-laws in fact should have been made, or officers elected. These powers could or could not be exercised at the option of the owner or owners of the stock, and property of said company. All such rules and regulations for the government of the business was a matter between the parties in interest, and except published or brought to the notice of strangers, did not effect them: Code sec. 1679. And the fact that, in an association under the Act of 1847, one of the stockholders finally buys up and owns all the stock and property of the balance, and the whole lodges in him, does not deprive such person from the use and rights of the charter, to carry on the business, under the name adopted; and the fact of being the sole owner, if he goes on, and uses such name, does not abate suits at law or equity filed against such corporation, although individual property. No corporation once legally existing dies, in contemplation of law, without some act forfeiting its franchises, but it will be recognized by the law, as long as it carries on its legitimate business, in its corporate name, and through agents and persons who use that name in its trade or business. It would be an anomalous doctrine, that one should purchase all the stock of such a joint stock company, privately, and without giving notice of such ownership, should carry on the business, use the corporate name, brands, stamps and trademarks, and keep books in its name, buy and sell in its name, and be permitted to plead its dissolution, when sued by the very name in which it contracted, in violation of the terms of its existence, that it could sue and be sued by that name. Every corporation speaks by men, and its artificial existence blends with that of its agents and officers. The corporate name is nothing without the living men who use that name ; but when used by those who are its proper agents, it is liable by that name to suit under the provisions of its charter. The position this case occupies from the evidence is, that the Newton Manufacturing Company continued to do business, under its corporate name, its agents contracted, in its name, with the plaintiffs, the receipt was in its name, and it was not dead nor dormant so far as the parties to this case are concerned. If it was alive to make this contract, the right of suit continues until the liability is discharged.

If Mr. Phillips had, after his purchase of the stock, done business openly in his own name, this would have ended the corporate name. But from this record he used the corporate name to transact the business. Pennington swears that he gave receipts for Newton Manufacturing Company under the order of Phillips: “he directed me to sign for Newton Manufacturing Company,” not for “ W. R. Phillips,” that he did not want it known that he was the “ Newton Manufacturing Company.” Every witness in the case substantially sustains this material fact, and we, therefore, are of the opinion that, inasmuch as the Newton Manufacturing Company went on under its name to transact its business, it was liable, in that name, to sue aud be sued, and it was not error in the Court to disallow testimony ofiits dormancy, under the pleadings.

2. The next question material to the ease is whether under the contract as proven, demand and notice of the election was necessary before the institution of the suit. In the view the Court below held of this question we concur, and his charge, in our opinion, left the matter fairly to the jury. His charge was “ that if they demanded or requested a settlement of the account sued for before the commencement of the action and defendant refused it, it is sufficient notice.” There was testimony on this subject sufficient to invoke the charge and sustain the finding of the jury theron.

Several exceptions to the charge of the Court were made and are assigned as error; but the general prevailing sentiment of exception is based on the first ground we have discussed, and after carefully examining the charge of the Court, under the law and facts of this case, we are satisified that the points in issue were fairly stated for their adjudication, and we are satisfied with the verdict under the rule of this Court so often repeated, that, except in cases where the verdict is decidedly against the weight of evidence, we will not interfere with the province of the jury.

Judgment affirmed.