City of South Bend v. Hardy.

discretion be, in any case, subject to review upon appeal, we are satisfied that there was no abuse of discretion in this case.

[Minor matters omitted.]

The judgment should be affirmed.

PER CURIAM-It is ordered, upon the foregoing opinion, that the judgment be affirmed, at the costs of the appellant.

CASES

IN THE

SUPREME COURT

ALABAMA.

JORDAN V. ALABAMA GREAT SOUTHERN RAILROAD COMPANY.

M

(74 Ala. 85.)

Corporation - malicious prosecution.

An action for malicious prosecution may lie against a corporation.

ALICIOUS prosecution. The opinion states the case.
defendant had judgment below.

D. T. Castleberry, for appelleant.

Rice & Wiley, Inzer & Green, and J. J. Garrett, contra.

BRICKELL, C. J. The judgment of the Circuit Court, sustaining the demurrers to the complaint, was doubtless in obedience to the decision in Owsley v. M. and W. P. R. Co., 37 Ala. 560, that while an action of trespass for false imprisonment may be maintained against a corporation aggregate, an action on the case for a malicious prosecution cannot be supported. The distinction between the two actions, which embodies the reason of the decision, then supposed to rest on the weight of authority, is thus stated: "The

Jordan v. Alabama Great Southern Railroad Company.

distinction seems to be between acts injurious in their effects, and for which the actor is liable without regard to the motive which prompted them, and conduct the character of which depends upon the motive, and which, apart from such motive, cannot be made the ground of legal responsibility." There are not wanting authorities taking the like distinction, affirming that as a corporation "is an artificial being, invisible, intangible, and existing only in the contemplation of law," to which the law cannot impart animus, passion, or moral quality; which is incapable of the commission of an offense, deriving criminality from an evil intent, or consisting in a violation of social duty, it cannot be subjected to a civil action of which an essential, distinguishing element is malice, or a mischievous purpose or motive. The current of authority now is, that corporations are responsible, civilly, the same as natural persons, for wrongs committed by their officers, servants or agents, while in the course of their employment, or which are authorized, or subsequently ratified. Ang. & Ames Corp., §§ 385-89; Morawetz Priv. Corp.. §§ 89-96; Cooley Torts, 119–23; S. and N. R. Co. v. Chappell, 61 Ala. 527.

The immunity from individual liability afforded by corporate organization; the capacity for the concentration and employment of intelligence, energy and capital, without break or interruption because of changes in membership, has led to the multiplication of corporations, until there is scarcely an object of general concern a corporation is not formed to promote, and to a great extent they have engrossed business in all hazardous enterprises, or enterprises requiring the investment and use of large capital. "With the multiplication of corporations," said ROGERS, J., in Bushell v. Com. Ins. Co., 15 S. & R. 176, "which has and is taking place to an almost indefinite extent, there has been a corresponding change in the law in relation to them;" and he adds: "The change in the law has arisen from a change of circumstances from that silent legislation by the people themselves, which is continually going on in a country such as ours, the more wholesome because it is gradual and wisely adapted to the peculiar situation, wants and habits of our citizens." And in P. W. and B. R. Co. v. Quigley, 21 How. 210, Mr. Justice CAMPBELL said: "With much wariness, and after close and exact scrutiny into the nature of their constitution, have the judicial tribunals determined the legal relations which are established for the corporation by their governing body. VOL. XLIX — 101

Jordan v. Alabama Great Southern Railroad Company.

and their agents, with the natural persons with whom they are brought into contact or collision." It is the aim and duty of courts to apply principles of the common law, with such modifications as are necessary to adapt them to the changed necessities, varied social conditions and diversified business and interests of the community. Perhaps there is not, in the history of the common law, more distinctive evidence of its modifications, of the rejection of its narrow technicalities, than in the adaptation of the legal relation of corporations to a just liability for the acts, omissions, or engagements of the governing body, or its agent, or servants, employed in the transaction of corporate business. The ancient rule, that they could speak and act only through the common seal, is obsolete; and now they are bound by the like implications and inferences which bind natural persons. The technicality, that an action of trespass would not lie against a corporation aggregate, because the process proper in such action-a capias and exigent-could not issue, has almost disappeared from the books. Referring again to the case of P. W. and B. R. Co. v. Quigley, supra, we quote the words of Mr. Justice CAMPBELL: "To enable impersonal beings - mere legal entities, which exist only in contemplation of law-to perform corporal acts, or deal with personal agents, the principle of representation has been adopted as a part of their constitution. The powers of the corporation are placed in the hands of a governing body, selected by the members, who manage its affairs, and who appoint the agents that exercise its faculties for the accomplishment of the object of its being. But these agents may infringe the rights of persons who are connected with the corporation, or who are brought into relations of business or intercourse with it. As a necessary co-relative to the principle of the exercise of corporate powers and faculties by legal representatives, is the recognition of a corporate responsibility for the acts of those representatives. * The result of the cases is, that for acts done by the agents of a corporation, either in contractu or in delicto, in the course of its business, and of their employment, the corporation is responsible, as an individual is responsible under similar circumstances." This is admitted to be the result of the authorities in Owsley v. M. and W. P. R. Co., supra, subject to the limitation that as the corporation is incapable of malice, it is not liable for torts of which malice is an essential element.

The idea that a corporation is not liable for a tort involving a

Jordan v. Alabama Great Southern Railroad Company.

malicious intent had origin in the day when it was denounced as soulless, and was an application of the quaint syllogism ascribed by Lord COKE to Chief Baron MANWOOD, that "None can create souls but God; but a corporation is created by the king; therefore a corporation can have no soul," from which was deduced the conclusion that it could do no wrong. There was a reluctance to look beyond legal entity, to the natural persons, its constituent members, or to the agents or servants through whom its faculties were exercised and its legal existence kept alive. To the mere legal entity, motive, good or evil cannot be imputed, but is imputable to its representatives; and as the corporation derives benefit from the representation, there is but little of justice in a claim of exemption from the responsibilities it may involve.

We have among us not only purely domestic corporations but corporations existing by the separate authority of several States, drawn into the daily transaction of business with all classes of the community, holding property of every species under the protection of the law of the State, compelled to a frequent resort to the courts for prevention or redress of injuries. Foreign corporations, by a liberal comity, here exercise corporate power, transact business, hold and enjoy property. It is by the representation of natural persons that their franchises are exercised, their business transacted and property acquired. It would not be just if a natural person suffer wrong from the malicious acts of the representative of a corporation, while within the scope of his employment, for the courts to refuse to look beyond the legal entity to its real and true character, an association or aggregation of natural persons capable of acting by a corporate name and in continuous succession. This is not unjust to the corporation, for it "tends to induce greater care and caution in the selection of those who are to be intrusted with corporate affairs." The same reasons that render a corporation responsible for any tort committed by its agents, if we do not resort to the technicality that it is incapable of motive, will render it liable for a malicious prosecution. Green v. Omnibus Co., 7 C. B. (N. S.) 290; Goodspeed v. East Haddam Bank, 22 Conn. 530; Carter v. Howe Machine Co., 51 Md. 290; s. c., 34 Am. Rep. 311; Wheless v. Second National Bank, 1 Baxt. 469; s. c., 25 Am. Rep. 783; Jefferson R. Co. v. Rogers, 29 Ind. 7; Iron Mountain Bank v. Mercantile Bank, 4 Mo. App. 505; Vance v. Erie R. Co., 32 N. J. L. 334; Williams v. Planters' Insurance Co.,