purposes, will be presumed to have received such a conveyance for some purpose within its powers, unless the contrary be shown. And in an action by a corporation as the owner of certain property which it had the right to acquire, the law presumes that it was lawfully acquired, if the manner of its acquisition does not appear. It is incumbent upon the defendant to show that it was illegally obtained, if he relies upon that defense.2

1 Chautaqua Co. Bank v. Risley, 19 N. Y. 369: Farmers' Loan etc. Co. v. Curtis. 7 N. Y. 466; and see Lindsley v. Simonds, 2 Abb. Pr. N. S. 69.

2 Farmers' etc. Bank v. Detroit etc. R. R. Co. 17 Wis. 372.

§ 43. Powers in respect to contracts.-Unless restrained by law, every corporation has the incidental power to make any contract which may be necessary to advance the objects of its creation. It may act and deal in the same manner that a natural person would, if he sought to accomplish the same end.2 Thus, a corporation may borrow money to accomplish the purpose for which it was organized, wherever such power may be fairly implied as a usual and appropriate means to accomplish the objects of its charter,3 and may bind itself, by a written obligation, for its repayment. A company established for the purpose of trading, may make all such contracts as are of ordinary occurrence in that trade, and will be bound by them.5 Banks, insurance companies, and similar corporations, may be liable upon contracts which do not strictly conform to their charters. It is sufficient if there be a usage and practice under such circumstances as may be presumed to be within the general knowledge and by the consent of the company. A corporator may contract with his corporation; and there is no legal objection to such a contract, when the authority of the corporation to contract with its members is within the reason of the powers vested in it, and may be necessary for their execution, although this authority may not be expressly given by any statute. A corporation may make any

8

11

contract within its powers, in a foreign government, if the contract be not prohibited by that government; 10 and the agents and officers of a corporation chartered in one state, may bind it by contracts and engagements made in another state, if not contrary to good policy, or prejudi cial to the interest of the latter state.12 Corporations are presumed to contract within the powers and limitations of their charters; 18 and it lies upon those who impeach any contract to show that it is void.14

1 Galena v. Corevith, 48 Ill. 423; Strauss v. Eagle Ins. Co. 5 Ohio St. 59; Broughton v. Manchester Water-works Co. 3 Barn. & Ald. 1; Seibrechtv. New Orleans, 12 La. 496; Brooklyn Gravel Road Co. v. Slaught er. 33 Iud. 185; Weckler v. First Nat. Bank, 42 Md. 581; Goodrich v. Detroit, 12 Mich. 279; Bateman v. Mayor etc. 3 Hurl. & N.322; Douglass v. Virginia City, 5 Nev. 147.

2 Union Water Co. v. Murphy's Flat Fluming Co. 22 Cal. 620; Feeny . People's Fire Ins. Co. 2 Robt. 599; State Bank v. Cape Fear Bank, 13 Ired. 75.

3 Partridge v. Badger, 25 Barb. 146; Barnes r. Ontario Bank, 19 N. Y. 152; Davis v. Proprietors etc. 8 Met. 321; Union Mm. Co. v. Rocky Mt. Nat. Bank, 2 Cal. 248; Moss v. Haspeth Academy, 7 Heisk. 283.

4 Frye v. Tucker, 24 Ill. 180; Clarke v. School District etc. 3 R. I. 199; Smith v. Law, 21 N. Y. 2.6; Eastern Union Railw. Co. v. Hart, 8 Exch. 116; S. C. 14 Eng. L. & Eq. 535; Covington v. Covington etc. Bridge Co. 10 Bush, 6; Thompson v. Lambert, 44 Iowa, 233; Garduer v. London etc. Railw. Co. Law R. 2 Ch. 201.

5 In re Contract Co. Law R. 8 Eq. 14; Colliery Co. v. Waddle, Law R. 3 C. P. 463; Nicholson v. Bradfield Union, Law R. 1 Q. B. 620. One railroad company may, upon a sufficient consideration, guarantee the bonds of another railroad company: Low v. Cent. Pacif. R. R. Co. 52 Cal. 53; 28 Ain. R. 629.

6 Buckley v. Derby Fish. Co. 2 Conn. 252.

7 Witte v. Derby Fish. Co. 2 Conn. 260; Kilgore v. Bulkley, 14 id. 362.

8 Culbertson v. Wabash Nav. Co. 4 McLean, 544.

9 Revere v. Boston Copper Co. 15 Pick. 135; Middlesex Turnpike Co. v. Swan, 10 Mass. 384; and see Ely v. Sprague, 1 Clarke Ch. 351; Gordon v. Preston, 1 Watts, 385. A promissory note made by a corpo ration to its trustees is against public policy, and void: Wilbur v. Lynde, 4) Cal. 290; 19 Am. R. 645.

10 Bank of Augusta v. Earle, 13 Peters, 519; Blair . Perpetual Ins. Co. 10 Mo. 559; Tombigbee R. R. Co. v. Kneeland, 4 How. 16; Weymouth v. Wash. etc. R. R Co. 1 McArthur, 19.

11 Arms v. Conant, 36 Vt. 744; Ohio etc. R. R. Co. v. Wheeler, 1 Black, 286; Day v. Newark India Rubber Co. 1 Blatchf. 628; Wood Hy. draulic etc. Co. v. King, 45 Ga. 34; Christian Union v. Yount, 101 U. S. 71.

12 Newburg Petroleum Co. v. Weare, 27 Ohio St. 343; Home Ins. Co. . Davis, 29 Mich. 238; Smith v. Alvord, 63 Barb. 415; State v. Fosdick, 21 La. Au. 434; Cowell v. Springs Co. 100 U. S. 55.

BOONE CORP.-5.

13 Morris etc. R. R. Co. v. Sussex R. R. Co. 20 N. J. Eq. 542; Union Water Co. v. Murphy Co. 22 Cal. 620; Alabama etc. Ins. Co. v. Central etc. Assoc. 54 Ala. 73; Railw. Co. v. McCarthy, 96 U.S.258, 267; Whitney Arms Co. v. Barlow, 63 N. Y. 62; Hope Mut. Life Ins. Co. v. Taylor, 2 Robt. 278.

14 Yates v. Van De Bogert, 56 N. Y. 526; Oxford Iron Co. v. Spradley, 46 Ala. 98; Downing v. Mt. Wash. Co. 40 N. H. 230; Danav. Bank of St. Paul, 4 Minn. 385; Scottish etc. Railw. Co. v Stewart, 3 Macq. 382; Shrewsbury etc. Railw. Co. v. Northwestern Railw. Co. 6 H. L. Cas. 113.

§ 44. Mode of contracting.-When the act of incorporation prescribes a mode of contracting, the corporation must observe that mode, or the instrument no more creates a contract than if the body had not been incorporated.1 But unless the mode be prescribed and limited, a corporation, like an individual, may be bound by an implied contract,2 to be deduced by inference from the corporate acts, provided it is within the scope of its corporate authority.4 Wherever a corporation is acting within the scope of the legitimate purposes of its institution, all parole contracts made by its authorized agents are express promises of the corporation;5 and all duties imposed upon them by law and all benefits conferred at their request raise implied promises, for the enforcement of which an action will lie. And a vote of the corporation is not necessary to be shown in order to authorize a contract made on its behalf by an agent or officer in the scope of his usual authority. In the case of a contract by a corporation in this country, a seal is no longer deemed as of any more necessity or significance than in the case of a contract by a natural person. And unless the act of incorporation expressly prescribes the contrary, the duly authorized agents of corporations may, within the scope of their authority, bind them by simple as well as by sealed contracts. So, it is the established doctrine in England, that a trading corporation may contract without seal for a purpose connected with the objects of the incorporation, provided such contract does not relate to matters of a special and unusual nature; 10 the absence of a seal will be excused as it respects matters of trivial and every-day occurrences.11 Less strictness, as it respects the name, is

required in contracts with corporations than in actions by or against them.12 In the former case it is sufficient if the name of the corporation be so given as to distinguish it from other corporations. 18 The individual members of a corporation cannot, unless authorized, bind the body by express promises; 14 nor can any corporate engagement be implied from their unsanctioned conduct or declarations.15 Whenever a corporation makes a contract, the only rights it can claim under such contract are those which are given to it in its corporate capacity, and not the rights which belong to its members as the citizens of a state. 16

1 Harborough v. Shordlow, 7 Mees. & W. 87; 2 Eng. Railw. Cas. 253; White v. New Orleans, 15 La. An. 667; Head v. Ins. Co. 2 Cranch, 127; Bal timore v. Reynolds, 20 Md. 1; Zottman v. San Francisco, 20 Cal. 390; Pimento v. San Francisco. 21 id. 351; Bladen v. Philadelphia, 60 Pa. St. 464.

2 N. Y. etc. R. R. Co. v. Mayor etc. 1 Hilt. 562; Lowe v. London etc. Railw. Co. 14 Eng. L. & Eq. 18; and see McSpedon v. Mayor etc. 20 How. Pr. 395; 7 Bosw. 601.

3 Maher v. City of Chicago, 38 Ill. 266; Abbot v. Herman, 7 Me. 118; Abby v. Billups, 35 Miss. 618; Frankfort Bridge Co. v. City of Frankfort, 18 B Mon. 41; Gowan Marble Co. v. Tarrant, 73 Ill. 608.

4 N. Y. etc. R. R. Co. v. Mayor etc. 1 Hilt. 562; and see Silliman v. Fredericksburg etc. R. R. Co. 27 Gratt. 119.

5 Fanning v. Gregoire, 16 How. 524; Fleckner v. Bank of U. S. 8 Wheat. 338; McCullough v. Talladega Ins. Co. 46 Ala. 376. Compare Trustees etc. v. Johnson, 53 Ind. 273.

6 Blunt v. Walker, 11 Wis. 334; Maine Stage Co. v. Longley, 14 Me. 444; Peterson v. Mayor etc. 17 N. Y. 449; Madison etc. R. R. Co. v. Nor wich Sav. Soc. 24 Ind. 457; Board of Education v. Greenebaum, 39 Ill. 609.

7 Lime Rock Bank v. Macomber, 29 Me. 564; Eastman v. Coos Bank, 1 N. H. 23; and see Consociated Presby. Soc. v. Staples, 23 Conn. 544.

8 Bank of Columbia v. Patterson,7 Cranch, 299; Savings Bank v. Da vis, 8 Conn. 191; New Athens v. Thomas, 82 Ill. 259; Watson v. Bennett, 12 Barb. 196; Hamilton v. New Castle R. R. Co. 9 Ind. 359; Peterson v. Mayor etc. of N. Y. 17 N. Y. 449; and see Missouri River etc. R. R. Co. v. Commr's, 12 Kans. 482.

9 McCullough v. Talladega Ins. Co. 46 Ala. 376. See San Antonio v. Gould, 34 Tex. 49.

10 South of Ireland Colliery Co. v. Waddle, Law R. 3 C. P. 463; Nich olson v. Guardians etc. Law R. 1 Q. B. 620; Henderson v. Australian Royal Mail etc. Co. 5 El. & B. 409; In re Contract Corp. Law R. 8 Eq. 14. 11 Mauby v. Long, 3 Lev. 107: Wells v. Mayor etc. Law R. 10 C. P. 402; Bank of U.S. v. Dandridge, 12 Wheat. 64. See Austinv. Guardians etc. Law R. 9 C. P.91.

12 See CORPORATE NAME, § 29, ante.

13 Hagerstown Turnp. Co. v. Creeger, 5 Har. & J. 122; and see Newport Manuf. Co. v. Starbird, 10 N. H. 123; Stein v. Indianapolis Assoc. 18 Ind. 237.

14 Soper v. Buffalo etc. R. R. Co. 19 Barb. 310; Ruby v. Abyssinian Soc. 15 Me. 306; Regents of University v. Williams, 9 Gill & J. 365.

15 Dunn v. St. Andrews Church, 14 Johns. 118; Proprietors etc. v. Gordon, 1 Pick. 297.

16 Bank of Augusta v. Earle, 13 Peters, 519; and see Vt. Cent. R. R. Co. v. Clayes, 21 Vt. 30.

§ 45. Principles of construction.—General words used in a corporate contract which admit a double construction, will be construed consistently with the charter.1 Contracts made by the officers of a corporation will be presumed to have been made in pursuance of the authority derived from the statutes of the state under which the corporation was organized, rather than of that derived from a foreign incorporation under the same name.2 A contract by a corporation, which is entirely foreign to the objects and purposes of its charter, is void. But a company having power to contract for the purchase of goods, is bound by such contract, although the goods may not be intended for the use of the company, and although this fact may be known to the person with whom the contract is entered into.4 A contract, valid in part, and invalid as to the residue, for want of power in the corporation to make the entire contract, will be valid to the extent of the power, and void only as to the excess.5 The contract obligations of a corporation survive the dissolution of the corporation. And where a corporation changes its : name for convenience, but continues in the same general business with the same officers, it is responsible under the new name for all its previous debts. In the case of a contract entered into with a corporation, to be executed in the future, the contingency of the continued existence of the corporation must be regarded as having been in the view of the parties.8 Contracts of a corporation, open to the objection that they are in violation of law, may be legalized by a special act of the legislature.9 A contract made by a corporation which, by statute, it is expressly prohibited from making, is so far void, that the corporation cannot maintain an action thereon, although the