Some of the provisions in the articles of association of a joint stock company may be directory only, and intended to operate only as between the directors and the shareholders, and may not constitute conditions to the exercise of the powers of the directors, or to the validity of their acts as regards the public. The non-observance of these provisions might be a breach of duty on the part of the directors, but would not necessarily invalidate their dealings with third parties as against the company (a). The deed of settlement of a joint stock insurance company registered under the 7 & 8 Vict. c. 110, provided that "the common seal shall not be affixed to any policy, except by an order signed by three directors and countersigned by the manager;" it was held that a policy to which the common seal had been affixed by the proper officers, in apparent conformity with the deed of settlement, was not rendered void as against the company by want of such an order to affix the seal (b). So, a provision in the deed of settlement of a company registered under the 7 & 8 Vict. c. 110, that bills of exchange to be issued by the directors should be so issued as to be binding on the company and on the shareholders to the extent of the shares held by them, and not further, was held not to limit the liability of the company on bills issued by the directors in conformity with the Act (c). authorized Where a contract has been made for a company by persons Ratificanot duly authorized in that behalf, or without the observance tion of un. of the formalities necessary to bind the company, such con- or informal tract may be afterwards ratified by the company, or by directors or other persons duly authorized for that purpose on (a) Prince of Wales Ass. Co. v. Harding, E. B. & E. 183, 214; 27 L. J. Q. B. 297, 307; and see Bill v. Darenth Valley Ry. Co., 1 H. & N. 305; 26 L. J. Ex. 81. (b) Prince of Wales Ass. Co. v. Harding, E. B. & E. 183; 27 L. J. Q. B. 297. (c) Allen v. Sea Fire Ass. Co., 9 C. B. 574; Gordon v. Sea Fire Ass. Co., 1 H. & N. 590; 26 L. J. Ex. 202; and see Ex p. Greenwood, 3 De G. M. & G. 459; 23 L. J. C. 966. These contract. behalf of the company, provided it is a contract within the powers of the company to make (a). It has been decided that contracts made by the promoters of a railway or other company, on behalf of such company, with the object of obtaining the Act of Parliament by which the company is to be formed, and of which the company obtains the benefit, are binding, in equity, upon the company after its formation (b); but the propriety of this decision has been much questioned (c). A company does not become bound by, nor can it adopt or ratify, a contract made on its behalf by the promoters, respecting any matter which is ultra vires of the company (d). Contracting by an agent. A PERSON capable of making a contract may appoint an agent to make the contract for him. It is not essential that the agent should be capable of making the contract in his own right, if the principal who appoints him, is capable (e); but it is necessary that the agent should be capable of contracting in order to become responsible to his principal for the proper discharge of the agency. (a) Ridley v. Plymouth Baking Co., 2 Ex. 711; Smith v. Hull Glass Co., 11 C. B. 897; 21 L. J. C. P. 106; Reuter v. Electric Telegraph Co., 6 E. & B. 341; 26 L. J. Q. B. 46; and see Bargate v. Shortridge, 24 L. J. C. 457; Grady's case, 32 L. J. C. 326, 328. (b) Edwards v. Grand Junction Ry. Co., 1 My. & Cr. 650; Stanley v. In general, all contracts and promises may be made through an agent properly authorized to contract for his principal. An exception formerly occurred in promises to renew debts barred by the Statute of Limitations; which promises were required by Lord Tenterden's Act, 9 Geo. IV. c. 14, s. 1, to be in writing, signed by the party chargeable thereby, and were held to be not sufficient, if signed by an agent of the party instead of the party himself (a); but by the Mercantile. Law Amendment Act, 1856, 19 & 20 Vict. c. 97, s. 13, such promises may now be signed by an agent of the debtor. An exception still occurs in the ratification after full age of a promise made during infancy, which by Lord Tenterden's Act, s. 5, must be by writing signed by the party to be charged therewith; and the Mercantile Law Amendment Act has not in this case removed the necessity of the ratification. being signed by the party himself. ment of No particular form is required generally by law for the ap- Appointpointment of an agent to make a contract. The authority agent. may be given in express terms, either written or spoken; or it may be implied from the acts and dealings of the parties, or from their relationship, character, or employment: for instance, the relationship of husband and wife (b), and of partners, the employment of a person of a recognized profession, or in a particular business, import an agency for certain purposes, and to a certain extent, and so constitute various modes of appointing an agent. attorney. But in some cases and for some purposes particular forms Power of are required by law for the appointment of an agent. Thus, the authority to execute a deed must be given by a deed (c). This rule applies even between partners, who have a general authority to bind one another by simple contract in partnership transactions; "a general partnership agreement, though under seal, does not authorize partners to execute deeds for each other, unless a particular power be given for that pur (a) Hyde v. Johnson, 2 Bing. N. C. 776. (b) The authority of a wife, as agent for her husband, has, in deference to the usual practice, been treated of in connection with the capacity of (c) White v. Cuyler, 6 T. R. 176; Authority in writing. Implied authority. pose (a)." An authority given to an agent to execute a deed for the principal is commonly called a letter of attorney or power of attorney. Under the Statute of Frauds, 29 Car. II., c. 3. s. 1 & 3, relating to the creation, assignment, and surrender of leases, and estates and interests in land, it is required that agents to be appointed to effect such transactions shall be authorized by writing. Under the 4th section, relating to the contracts therein described, and the 17th section, relating to contracts for the sale of goods, though it is required that there be a memorandum of such contracts in writing and signed by the party to be charged therewith or his agent lawfully authorized, the mode of authorizing the agent is left open, and it may be made in any sufficient manner (b). Authority may be impliedly given by the acts of the principal without an express order, as in the following cases :-If the owner of goods sends them to another, whose common business it is to sell goods, it is evidence of an authority to sell them for him; so, if he sends goods to an auction room, or if he sends a horse to a repository for sale, it can only be implied that he sends them for the purpose of sale. "Where the commodity is sent in such a way and to such a place as to exhibit an apparent purpose of sale, the principal will be bound, and the purchaser safe (c)." Where the owner of goods entrusted them with a broker whose ordinary business it was to buy and sell goods of that kind, it was held that the broker was impliedly authorized to sell them (d). The effect of the acts of the principal in giving such authority is a question of fact for the jury (e). An authority may be impliedly created by an habitual mode of dealing; as, if a person has been in the habit of allowing another to draw and indorse bills for him, and has paid bills so drawn and indorsed, a continued authority may be implied to act as on previous occasions (f). So, if a (a) Harrison v. Jackson, 7 T. R. 207, 210. (b) Emmerson v. Heelis, 2 Taunt. 38, 46; ante, p. 150. (c) Pickering v. Busk, 15 East, 38, 43. (d) Pickering v. Busk, 15 East, 38. (e) Dyer v. Pearson, 3 B. & C. 38. (f) Prescott v. Flinn, 9 Bing. 19; and see Davidson v. Stanley, 2 M. & G. 721; Levy v. Pyne, Car. & Marsh. 453. person has been in the habit of paying for goods ordered by another upon his credit, an authority to pledge his credit in future may be implied (a). arising from In some exceptional cases circumstances of sudden ne- Authority cessity or emergency create, or enlarge, an agency for the necessity. occasion to contract on behalf of the person whose interests are involved. The master of a ship, upon an occasion of necessity arising during the voyage when he cannot communicate with his employer, acquires authority to do such repairs, and to obtain such supplies and services, and to make such payments, as are necessary and proper for the prosecution of the voyage, and, for these purposes, to pledge the credit, or raise money upon the credit of his employer (b). Another instance occurs in the case of bills of exchange which are protested for non-acceptance or non-payment; any person may accept or pay such a bill supra protest for the honour or on behalf of the drawer or other party to the bill, and is authorized to do so by the law merchant, upon the necessity of the case, and may recover his expenses against the party on whose behalf he has acted (c). To these instances may be added the case of a husband turning away his wife, or compelling her by his misconduct to live separate from him, without an adequate maintenance; the wife is then invested by necessity with an authority to pledge the husband's credit in order to obtain the means of subsistence (d). But the mere necessity of a person's affairs, however urgent, does not, in general, give any authority to another to contract on his behalf (e). An accident happening upon a railway does not authorize a station master or other servant of the company to engage a surgeon on behalf of the company to attend the wounded passengers; and, therefore, a surgeon who had been called to attend a passenger, under such circumstances, by one of the servants of the railway (a) See Hazard v. Treadwell, 1 Str. 506; Summers v. Solomon, 7 E. & B. 879; 26 L. J. Q. B. 301. (b) Webster v. Seekamp, 4 B. & Ald. 352; Arthur v. Barton, 6 M. & W. 138; Hawtayne v. Bourne, 7 M. & W. 595, 599; Beldon v. Campbell, 6 Ex. 886. (c) See Byles on Bills, 8th ed. 243, 248; Chitty on Bills, 10th ed. 237,338. (d) Johnson v. Sumner, 3 H. & N. 261; 27 L. J. Ex. 341; and see Davidson v. Wood, 32 L. J. C. 400; see ante, p. 243. (e) See Hawtayne v. Bourne 7 M. & W. 595. |