formed, it will be held to have assented to them, as much as if it had been a natural person. But the principle that a company venience, and sound sense," and he might have said, perhaps, with equal propriety, will finally be found virtually to include all the legitimate business of corporations. For it is impossible to make any sensible distinction, between the proper business of a corporation, as appears upon the face of their charter, and that which is purely incidental or ancillary to the proper business of the corporation. And this is conceded by Lord Campbell, in the Governor & Company of Copper Miners v. Fox, supra, when refining upon the very elemental distinction between a trade in iron and copper.

And if we allow corporations to bind themselves, without seal, in all the business created by their charter, and in all that is incidental thereto, we shall have few cases remaining.

The only remaining case, directly upon the subject, which has yet reached us, is that of Henderson v. The Australian Royal Mail Steam Nav. Co., 5 El. & Bl. 409; s. c. 32 Eng. L. & Eq. 167 (June, 1855), where the defendants, a company incorporated for the purpose of carrying the mails, passengers, and cargo, between Great Britain and the Cape of Good Hope and Australia, and for that purpose to construct and maintain steam and other vessels, and to do all such matters as might be incidental to such undertaking, entered into a contract with the plaintiff to go out to Sydney and bring home a sloop belonging to the company which was unseaworthy, and it was held, that the action might be maintained, for the service performed under the contract, although the contract was not under seal. The opinion of the judges at length will afford the safest commentary upon the present state of the English law upon the subject, and will present a very instructive contrast with the quiet, and perfectly settled, and satisfactory state of the law here upon the same subject, from having, as we believe, more wisely, abandoned a rule which grew out of an uncultivated state of society, and which had a very limited application, when adopted, and which is found, in practice, utterly inconsistent with the views of business men, in all commercial countries, at the present day.

Wightman, J.: "I am of opinion that our judgment should be for the plaintiff. This is an action against the Australian Royal Mail Steam Navigation Company, which is a company constituted expressly for the purpose of carrying on a trade by vessels; it is incorporated for the purpose of undertaking the establishment and maintenance of a communication, by means of steam navigation, or otherwise, and the carrying of the royal mails, passengers, and cargo, between Great Britain and Ireland, and the Cape of Good Hope and Australasia,' and for that purpose it must maintain and employ many vessels. Can it be doubted that amongst the ordinary operations of the company there would arise a necessity for employing persons to navigate or bring home vessels which met with accidents abroad? The words of the contract, as set out in the declaration, show an employment directly within the scope of the objects for which the company was incorporated.

"It is true there is a conflict of authorities which it is difficult to reconcile. Two or three cases in the Court of Exchequer, Lamprell v. The Billericay Union, 3 Exch. 283, and the Mayor of Ludlow v. Charlton, 6 M. & W. 815, and

*is not bound by a deed of agreement entered into by its directors or trustees for and on behalf of the company, which is not Arnold v. The Mayor of Poole, 4 Man. & Gr. 860, in the Court of Common Pleas, appear to militate against the view taken by this court. But those decisions proceded upon a principle adapted to municipal corporations, which are created for other objects than trade; and the Court of Exchequer applied that principle to modern trading companies, which are of an entirely different character.

"In early times there was a great relaxation of the rule which required that the contracts of corporations should be under seal, and that relaxation has been gradually extended. At first the relaxation was made only in those cases mentioned by Mr. Lush, when the subject-matter of the contract was of small moment and frequent occurrence, which in the case of municipal corporations might be the only exceptions necessary. But in the later cases there was a further relaxation, especially in the case of corporations created by charter for trading purposes, and other like corporations. The general result of the cases mentioned in Clark v. The Guardians of the Cuckfield Union, 16 Jur. 686; s. c. 11 Eng. L. & Eq. 442, is, that in the case of trading corporations, wherever the contract relates and is essential to the purpose for which the company was incorporated, it may be enforced, though not under seal. In deciding that case, I reviewed all the cases, and adhere to the opinion which I then expressed, that in such a case as the present, where the contract is essentially necessary to the objects of the company, and directly within the scope of their charter, it may be enforced, though made by parol."

Erle, J.: "I am of opinion that the contract is binding on the corporation, though not under seal, on the ground that it is directly within the scope of the company's charter.

"The authorities are apparently conflicting, but none conflict with the principle laid down by my brother Wightman, in which I concur. In Beverley v. The Lincoln Gas Light and Coke Company, 6 Ad. & Ell. 829, the supply of gas was directly incident to the purpose for which the company was incorporated. So also in Church v. The Imperial Gas Light & Coke Company, 6 Ad. & Ell. 846 ; and in Sanders v. The Guardians of the St. Neot's Union, 8 Q. B. 810; and in the elaborate judgment of Wightman, J., in Clark v. The Guardians of the Cuckfield Union, 16 Jur. 686; s. c. 11 Eng. L. & Eq. 442, it was assumed that the matter was within the scope of the company's charter.

"The judgment delivered by Lord Campbell, Ch. J., for this court, in the Copper Miners' Company v. Fox, 16 Q. B. 229; s. c. 3 Eng. L. & Eq. 420, enunciated the principle. The principle affirmed by this series of cases does not conflict with the two leading cases in the Court of Exchequer, which were cases of municipal corporations. Neither building, which was the matter in the Mayor of Ludlow v. Charlton, 6 M. & W. 815, nor litigation, which was the matter in Arnold v. The Mayor of Poole, 4 Man. & Gr. 860, was incidental directly to the purposes for which the corporations of those towns were constituted.

"The other cases to which I adverted were corporations for trading purposes and it is difficult to reconcile them. In Lamprell v. The Guardians of the Billericay Union, 3 Exch. 283, the action related to the building a workhouse, with

under the seal of the company, is still adhered to by the English and Irish courts. And to this extent the rule may not be

which the defendants were, as a corporation, connected. Diggle v. The London & Blackwall Railw., 5 Exch. 442, is that which to the greatest degree conflicts, unless it can be distinguished or explained on the ground that it was a unique contract; if it cannot, I do not agree to it; and in this conflict of authorities I adhere to those who oppose it.

"The notion that a set of contracts shall have their validity depending on the frequency and insignificancy of the subject-matter is of such extreme perniciousness, that I do not think that it can be adhered to, and must be considered as applicable only to municipal corporations. It has been so held as to contracts for servants, but I do not think that it was meant to be said that the contract was valid if the matter was of small importance, and invalid if the matter was of great importance; and indeed, in the case of trading companies, which it is allowed may draw and accept bills of exchange not under seal, it is obvious that insignificancy is no element; neither is the frequency or rarity of the contract an element. The nature of the contract and the subject-matter of it must be the principle which governs the question whether it is valid, though not under seal. It would be pernicious to the law of the country, that under the semblance of a contract parties should obtain goods or services, and not be compellable to pay for them. The Court of Exchequer had an opinion that it would be important that the rule should be certain; but their resort to the rule, that the contract in all cases, with the above-mentioned exceptions, should be under seal, cannot be acted upon."

Crompton, J. "I concur in the principle now adopted by my brothers Wightman and Erle. It is desirable that in the case of trading corporations there should be a relaxation of the rule, that the contract of corporations should be under seal, where the contract is for the purpose of carrying on their trade. That principle was supported in The Copper Miners Company v. Fox, 16 Q. B. 229; s. c. 3 Eng. L. & Eq. 420, and Clark v. The Guardians of the Cuckfield Union, 16 Jur. 686; s. c. 11 Eng. L. & Eq. 442; and it is an important principle, and may be the governing principle in these cases; and but for the two cases in the Court of Exchequer, I should think that the appointment of the plaintiff in this case did not require a seal. I cannot, however, distinguish this from Lamprell v. The Guardians of the Billericay Union, 3 Exch. 283, and Diggle v. The London & Blackwall Railw. Company, 5 Exch. 442; and if the judgment of the court depended upon me, I might defer to them, at the same time wishing the other principle to prevail. I cannot disguise from myself that we are deciding against the cases in the Court of Exchequer, and the rule which that court adopted. But I agree with what my brothers have said; and I will add, that those cases created considerable surprise at the time."

And in a still more recent case, Reuter v. The Electric Telegraph Co. 6 El. & Bl. 346 (May, 1856), in the Court of Queen's Bench, the defendants had made a contract, under their corporate seal, with the plaintiff, to transmit all his

4 McArdle v. Irish Iodine Co., 15 Ir. Com. Law, 146.

objectionable. But there are many American cases, where the construction in favor of the responsibility of the company for the messages, and all he could collect, for a commission not exceeding £500, or less than £300 per annum, and while this contract was in existence, the chairman of the company entered into a parol agreement with the plaintiff, to pay him at the increased rate of £50 per cent, in consideration of the plaintiff's further services in collecting public intelligence and sending it by the company's telegraph. These additional services were found to be beneficial to the company, and this agreement was entered upon the minutes of the company, and the plaintiff had received £300 for services in pursuance of it.

The deed of settlement provided, that all contracts, where the consideration exceeds £50, should be signed by three directors. It was held, that the parol contract having been acted upon, and ratified by the company, was binding upon them. De Grave v. The Mayor of Monmouth, is a case of ratification, 4 C. & P. 111.

And in Bill v. The Darenth Valley Railw., 1 H. & N. 305; s. c., 37 Eng. L. & Eq. 539, the Court of Exchequer held, that one who had served the company, as secretary, might recover compensation for his services, although the remuneration to be paid him had not been fixed, at a general meeting of the company, as required by the English statute. That was held to determine the duty of the directors towards the company, and not to limit the liability of the company to third parties, which is the view taken of the subject here. Noyes v. Rut. & Burling. Railw., 27 Vt. 110-113; ante, § 136, n. 5.

But it has been held, that if a corporation contract through an agent, who attaches a seal to his execution of the contract on their behalf, it thereby becomes the deed of the company, although the seal was not their common seal, and an action of assumpsit cannot be maintained upon it. Porter v. Androscoggin & Kennebec Railw., 37 Maine, 349. But it must be executed in the name of the company. Sherman v. New York Central Railw., 22 Barb. 239.

If, in an action of assumpsit, upon a contract, purporting to be executed by a railway company, the company claim that it was executed under their seal, and that therefore an action of assumpsit will not lie upon it, and prevail, upon this ground, they are estopped to deny, in a subsequent action of covenant, upon the same contract, that the seal attached to the contract is the seal of the company. Philadelphia, Wilmington & Baltimore Railw. v. Howard, 13 Howard, 307.

But the English courts do not hold the corporation absolutely bound by contracts under their common seal, thus reducing the question to one of authority, in fact, to enter into the contract. Shrewsbury & Birmingham Railw. v. London & N. W. Railw., 6 Ho. Lds. 113.

In The London Docks Co. v. Sinnott, 8 El. & Bl. 347 (Nov. 1857), the Court of King's Bench maintain the general rule that "corporations aggregate can only be bound by contracts under the seal of the corporation." Lord Campbell, Ch. J., in giving judgment, enumerates the following exceptions to the general rule, mercantile contracts, contracts with customers, and such as do not admit of being executed under seal, as bills of exchange. But in some English cases, decided since the publication of the second edition of this work, it seems

*act of the directors, even in executing a contract under seal, without using the specific seal of the corporation, is more forcible, the directors for the time being held to have adopted the seal used as the corporate seal, the same as any number of natural persons may adopt the same seal. But this latitude of construction in regard to the seal of a corporation is common in this country, it being generally held indispensable to bind the company by deed that their corporate seal should be used.

3. There has been considerable controversy, first and last, as to what, precisely, amounted to a seal. The generally received opinion upon the subject seems now to be, that a mere scroll or engraved likeness of the device of a seal will not answer the demands of the law.5 It must be the result of the use of some adhesive or impressible material. It was at one time restricted to the use of wax, or some similar material. But it seems now

to be regarded as sufficient, in the case of a corporation, if the impression is stamped into the substance of the paper on which the seal is used. There is a great deal of curious learning on the subject, much of which will be found in a carefully prepared article upon the subject, lately published.7

to be conceded that corporations may be as much bound by the contracts of their agents as natural persons. Thus in Wilson v. The West Hartlepool Railw. Co., 34 Beav. 187; s. c., 10 Jur. N. S. 1064, it was held that when a company, through their directors, hold out to the world that a person is their agent for a particular purpose, they cannot afterwards dispute acts done by him, within the scope of such countenanced agency. And accordingly where the general manager of a railway company had in several instances entered into contracts for the sale of the company's lands, which contracts had been adopted by the company, and he entered into a contract with the plaintiff for the sale to him of a portion of their land, and in pursuance of the terms of the contract the company's servants laid down a branch line of railway, and the plaintiff removed machinery and other effects to the land, and no act was done by the company to lead the plaintiff to believe that the contract had been entered into without authority; but they subsequently repudiated the authority of the manager and refused to convey the land to the plaintiff, upon bill for specific performance; it was held that the case fell within the principle of the London & Birmingham Railw. Co. v. Winter, Cr. & Ph. 57, and specific performance was decreed.

5 Bates v. Boston & N. Y. Central Railw., 10 Allen, 251.

6 Hendee v. Pinkerton, 14 Allen, 381.

7 1 Am. Law Review, 649.

* 602, 603