are alike subject to review by successive courts of appeal. may not be charged upon con tract Rundall, An infant is liable for wrong: but a breach of contract Infant may not be treated as a wrong so as to make the infant liable; the wrong must be more than a misfeasance in the performance of the contract, and must be separate from framed and independent of it. Thus where an infant hired a as a tort, mare to ride and injured her by over-riding, it was held Jennings v. that he could not be made liable upon the contract by framing the action in tort for negligence. Nor can an infant be made liable for goods sold and delivered by charging him in trover and con-*version: and yet [*118] the Infants' Relief Act makes a sale of goods to an infant absolutely void, and would so appear to prevent any property from passing to him. : 1. Siderfin, 129. for actual originat ing in contract. Haggis, 14 Burnard v. C.B.,N.S.45. But when an infant hired a horse expressly for riding but may and not for jumping, and then lent it to a friend who tort, jumped the horse and killed it, he was held liable for though 'what was done by the defendant was not an abuse of the contract, but was the doing of an act which he was expressly forbidden by the owner to do with the animal.'2 A butcher boy appropriated some of the meat which he was employed to carry to his master's customers: he sold it and kept the money. He was detected, an account was made of the money due from him which he acknowledged to be correct, and when he came of age he gave a promissory note for the amount. He was held liable for the amount. It was argued that the liability arose on an account stated, which was void under § 1, or on a 1 Eaton v. Hill, 50 N. H. 235. Whether an infant is liable in tort for a false representation as to his age there is disagreement. Rice v. Boyer, 108 Ind. 472; Nash v. Jewett, 61 Vt. 501. Some States make such misrepresentation a ground of estoppel to deny the contract. Stimson, Am. St. Law, § 6602. 2 Freeman v. Boland, 14 R. I. 39; Homer v. Thwing, 3 Pick. (Mass.) 492; Towne v. Wiley, 23 Vt. 355. 60 L. T. 665. In re Seager. ratification which was unenforceable under § 2. But the court held that he was liable to an action ex delicto, and that his promise to pay when he came of age was the compromise of a suit, for which, being of age he was competent to contract.1 (8) Corporations. §3. Corporations. A corporation is an artificial person created by law. Hence the limitations to the capacity of a corporation for entering into a contract may be divided into necessary and express. The very nature of a corporation imposes some to its con- necessary restrictions upon its contractual power, and the terms of its incorporation may impose others. 1. Neces sary limits tractual capacity. Must contract. through an agent. Ferguson v. Wilson, 2 Ch. 89. 45 & 46 Vict. c. 61. s. 91. A corporation is an artificial entity, apart from the persons who compose it; their corporate rights and liabilities are something distinct from their individual rights and liabilities, and they do not of themselves constitute the corporation, but are only its members for the time being. Since then a corporation has this ideal existence apart from its members, it follows that it cannot person[*119] ally enter into contracts, it must contract by means of an agent. It cannot act in its own person, for it has no person.' It follows also that a corporation must give some formal evidence of the assent of its members to any legal act which, as a corporation, it may perform. Hence the requirement that a corporation must contract under seal.2 By the law merchant an instrument under seal is not negotiable, but the Bills of Exchange Act makes an exception in favour of the negotiable instruments of corpora 1 Ray v. Tubbs, 50 Vt. 688. 2 In the United States a corporation need use a seal only where a natural person is required to use one. Bank of Columbia v. Patterson, 7 Cranch (U. S.), 299; Mott v. Hicks, 1 Cow. (N. Y.) 513; Hamilton v. Lycoming &c. Co., 5 Pa. St. 339. tions.1 Before this act a trading corporation whose business it might be to make such instruments could sign them by an agent duly appointed. Their validity must always depend on the capacity of the corporation to make them.2 tions. The express limitations upon the capacity of corporate 2. Express bodies must vary in every case by the terms of their incor- limitaporation. Much has been and still may be said as to the effect of these terms in limiting the contractual powers of corporations, but it is outside the purpose of this book to discuss the doctrine of ultra vires.' The question whether the terms of incorporation are the measure of the contracting powers of the corporation, or whether they are merely prohibitory of contracts which are inconsistent. with them, was discussed in the much litigated case of the Ashbury Carriage Company v. Riche, and the question was L.R. 7 H.L. thus stated and answered by Blackburn, J.: — I take it that the true rule of law is, that a corporation at common law has, as an incident given by law, the same power to contract, and subject to the same restrictions, that a natural person has. And this is important when we come to construe the statutes creating a corporation. For if it were true that a corporation at common law has a capacity to contract to the extent given it by the instrument creating it and no further, the question would be, Does the statute creating the corporation by express provision or necessary implication show an in 1 A negotiable instrument executed by a corporation under seal is not thereby rendered unnegotiable unless such was the intent of the corporation in affixing the seal. Therefore unless the instrument itself contains a recital as to the seal, or it is shown by extrinsic evidence that the seal was affixed by authority for the purpose of creating a specialty, the negotiable character of the instrument is not affected. Bank v. Railroad Co., 5 S. C. 156; Mackay v. Saint Mary's Church, 15 R. I. 121; Jones v. Homer, 60 Pa. St. 214; Weeks v. Esler, 68 Hun (N. Y.), 518. 2 In the United States a corporation has the implied power to make negotiable paper as evidence of any debt which it has authority to contract. Moss v. Averell, 10 N. Y. 449; Comm. v. Pittsburgh, 41 Pa. St. 278; Rockwell v. Elkhorn Bk., 13 Wis. 731; Auerbach v. Le Sueur Mill Co., 28 Minn. 291. Ꮮ 658. tention in the legislature to confer upon this corporation capacity to make the contract? But if a body corporate has, as incident to it, a general capacity to contract, the question is, Does the statute creating the corporation by express *provision or necessary implication In Exch. Ch. show an intention in the legislature to prohibit, and so avoid the making of a contract of this particular kind?' L. R. 9 Exch. 264. Contracts not void [*120] The House of Lords appear not to have dissented from this view of the general powers of corporations, though they placed a different interpretation upon the statute in question, holding that a company incorporated under the Companies Act of 1862 is bound by the terms of its memorandum of association to make no contracts inconsistent with, or foreign to, the objects set forth in the memorandum.1 A contract made ultra vires is void; but not on the ultra vires ground of illegality. Lord Cairns in the case above cited takes exception to the use of the term 'illegality,' pointing gality, but out that it is not the object of the contracting parties, but the incapacity of one of them, that avoids the contract.2 for ille for in capacity. 53 & 54 Vict. c. 62. The Companies Act of 1890 enables such a company to alter its memorandum under certain conditions and for 1 "In respect of the power of corporations to make contracts, two propositions may be stated:-(1) That they have, by mere implication of law and without any affirmative expression to that effect in their charters or governing statutes, and of course in the absence of express prohibitions, the same power to make and take contracts, within the scope of the purposes of their creation, which natural persons have; (2) That this power, on the other hand, is restricted to the purposes for which the corporation has been created, and cannot be lawfully exercised by it for other purposes." 4 Thompson on Corp., § 5645, and cases there cited. 2 In the United States if either party has had the benefits of a contract ultra vires, an action will lie in favor of the other party. The better view is that this liability is quasi-contractual, and that the suit is for benefits conferred, and not on the original contract. Central Trans. Co. v. Pullman Car Co., 139 U. S. 24; Brunswick Gas Light Co. v. United Gas Fuel & Light Co., 85 Me. 532; Slater Woollen Co. v. Lamb, 143 Mass. 420, H. & W. 222. Some courts put the decision on the ground of equitable estoppel. Denver Fire Ins. Co. v. McClelland, 9 Colo. 11. certain objects. The assent of a court which has jurisdiction to make an order for winding it up, and notice to the parties interested, are the chief conditions. The objects Ibid. § 1 (5). are the furtherance of its business, the addition of cognate business or the abandonment of some of its original objects. § 4. Lunatic and drunken persons. (4) Luna tic and drunken persons. The con The contract of a lunatic is binding upon him unless it can be shown that at the time of making the contract he was absolutely incapable of understanding what he was tract doing and that the other party knew of his condition.1 voidable: 'When a person enters into a contract and afterwards alleges that he was so insane at the time that he did not know what he was doing and proves the allegation, the contract is as binding upon him in every respect, whether it is executory or executed, as if he had been sane when he made it, unless he can prove further that the person with whom he contracted knew him to be so insane as not to be capable of 1 Q. B. 601. understanding what he was about.' Imperial lunatic: This decision enables us to dispense with the distinction whether of *between executory and executed contracts made with lunatics which is suggested in Molton v. Camroux. [*121] 1 The American cases are in great confusion. The following propositions may be regarded as fairly sustained by the weight of authority (1) Where the sane person does not know of the other person's insanity, and there has been no judicial determination of such insanity, and the contract is so far executed that the parties can not be put in statu quo, the contract is binding upon the lunatic. Gribben v. Maxwell, 34 Kans. 8, H. & W. 224; Young v. Stevens, 48 N. H. 133; Brodrib v. Brodrib, 56 Cal. 563; Copenrath v. Kienby, 83 Ind. 18. (2) The contract is voidable if the sane person knew of the other's insanity; Crawford v. Scovell, 94 Pa. St. 48; or if it has been judicially declared; Wadsworth v. Sharpsteen, 8 N. Y. 388; Carter v. Beckwith, 128 N. Y. 312; or if the lunatic can be put in statu quo. Burnham v. Kidwell, 113 Ill. 425. (3) The contract is void if so declared by statute; Stimson, Am. St. Law, § 6701; in some States if it be a deed of lands; Van Deusen v. Sweet, 51 N. Y. 378; Brigham v. Fayerweather, 144 Mass. 48; by high authority if it be a power of attorney; Dexter v. Hall, 15 Wall. (U. S.) 9. Some cases recog 2 Exch. 487; 4 Exch. 17. |