Case ID: nys_34/html/0209-01.html
Source: Caselaw Access Project
Author: {"author": "PARKER, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

(87 Hun, 462.)
    PATTERSON v. ONGLEY ELECTRIC CO.
    (Supreme Court, General Term, First Department.
    June 14, 1895.)
    1. Corporations—Contracts—Authority op Oppicers.
    Where a contract made in the name of a corporation by the president was one which the company could have authorized the president to make, or could have ratified, the .burden is on the corporation to show that it was not authorized.
    2. Same—Ratification—Evidence.
    Plaintiff entered into a written contract, signed in the name of defendant corporation by its president, and afterwards performed the services mentioned. Part of the compensation for such services was paid by the treasurer of defendant, and afterwards a resolution Was adopted that all the acts of the president in respect to the matters referred to in the contract “be, and hereby are, in all things approved, ratified, and affirmed.” Belch, that the act of the president in executing the contract was ratified.
    Appeal from circuit court, New York county.
    Action by- Thomas A. Patterson against the Ongley Electric Company to recover commissions for selling 1,500 shares of defendant’s stock. From a judgment entered on a verdict directed by the court in favor of plaintiff for $3,716.80, defendant appeals.
    Affirmed.
    Argued before VAN BRUNT, P. J., and FOLLETT and PARKER, JJ.
    Rufus W. Peckham, Jr., for appellant.
    John R Dos Passes, for respondent.
   PARKER, J.

In pursuance of a written contract, signed, “The Ongley Electric Company, T. W. Robertson, President,” the plaintiff’s assignor, J. F. Wiechers, undertook to and did sell 1,500 shares ®f the treasury stock of the Ongley Electric Company for $90,000, upon an agreed commission of 5 per cent. $1,550 was paid out of the treasury of the company to Wiechers on account of the commissions, but it has refused to pay the balance. The grounds on which defendant bases its refusal to pay is that the president had no authority to make the contract. The facts are briefly that on the 5th day of April, 1892, plaintiff’s assignor received a letter signed, “Ongley Electric Company, T. W. Robertson, President,” in which reference was made to a conversation of the day before had between Wiechers and Robertson on behalf of the electric company, which-concluded with the proposition that, for services to be rendered, the company would pay a commission of 5 per cent, upon the proceeds ®f the stock sold. Subsequently, but on the same day, plaintiff received a contract, signed as stated in the opening sentence, which provided, among other things, that he should receive a commission of 5 per cent, on account of stock sold for cash, for his services. Wiechers brought about a sale of 1,500 shares to a Mr. Hopkins, at $60, making a total purchase price of $90,000. The contract of sale between the Ongley Electric Company and George B. Hopkins was in writing, ánd signed in precisely the same manner as the contract with plaintiff’s assignor. It appears from the minutes of the board of directors that subsequently the contract of sale with Hopkins was fully ratified, and touching that general subject there was adopted a preamble and resolutions. One of the resolutions• reads as follows:

“Resolved, that all and every of the acts of the president of this company and of this said J. T. Thompson & Company in respect to the stock which Belonged to this company, above referred to, be and hereby are in all things approved, ratified, and confirmed.”

After the stock had been transferred to Hopkins, and the defendant had received the price agreed to be paid therefor, Wiechers received $1,550, which was paid to him in five checks of the defendant, each of which was signed by the president and treasurer of the eompany. These checks were paid in due course, and subsequently same back to the company. When produced upon the trial, there was stamped on the face of each check the following: “Henry M. Tate, Auditor, Feb., 1893.” The first check bears date November 10, 1892, and the last one November 21, 1892. In February following, there was a meeting of the directors and stockholders of the defendant, at which Wiechers was present. At this meeting, there was presented a balance sheet taken from the books of the company, which, among other things, purported to state the indebtedness of the company, and to whom such indebtedness was due, and that the same had been duly audited by Henry M. Tate, auditor of the company. This statement represented that there was due to Wiechers the amount which is claimed in this action. Wiechers says that there was no objection by any one, and that there was a resolution adopting the statement as a whole. This statement is not controverted. On the contrary, it is fully corroborated by the books and testimony of certain officers of the company. John B. Underhill, who was at the time of such meeting the secretary of the company, read the following extract from the book of minutes of the company:

“The treasurer submitted a statement of the company of Dec. 31, 1892, audited by Mr. Tate, the auditor of the company. Mr. Dixon asked for the results, and, on his being shown the balance sheet and examining it, moved that it be accepted, which motion was seconded by Mr. Hopkins and Mr. Devina, and passed by all present.”

There is no pretense that the president or other officers of the company attempted to keep away from the directors and stockholders the facts relating to the contract by which it was agreed to pay to Wiechers his commissions. Some of the officers at least knew it at about the time the contract was made, and it does not appear but that all of them did. The secretary of the meeting, who was called by the defendant, admitted that he knew that Wiechers was negotiating for the sale of the stock with Hopkins, and that it was agreed that he should receive 5 per cent, for commissions if successful. The transaction was entered upon the books of the company in the regular way, an account being opened with Wiechers after the sale of the stock, in which he was charged with the payments made on account; and the bill of Wiechers came regularly to the attention of the auditor employed by the company to audit its accounts, who, after making the audit, entered it in the statement, as we have already observed, which, in due course, came before the directors and stockholders at a meeting at which a majority of both were present. This statement, as we have seen, was after an examination accepted and passed. It does not appear that there was any other method by which this company formally passed upon claims against it. At the close of the testimony, the court directed a verdict in favor of the plaintiff for the balance claimed to be due, with interest.

We think this judgment can stand for two reasons:

1. Because the contract made in the name of the corporation by its president is one the company had power to authorize the president to make, or to ratify after he had made it; and therefore the burden was upon the corporation of showing that it was not authorized. Patterson v. Robinson, 116 N. Y. 193, 22 N. E. 372; Jourdan v. Railroad Co., 115 N. Y. 381, 22 N. E. 153; Oakes v. Water Co., 143 N. Y. 430, 38 N. E. 461. This burden the appellant did not meet. Its counsel correctly states in his brief that all the evidence offered by either party which in any way tended to show the powers of the president was put in evidence by the defendant, and consisted of a resolution of the board of directors appointing the president and two other members of the board an executive committee to act in minor matters.'

2. The evidence of ratification and approval by the defendant, its officers, directors, and stockholders, was so complete as to justify the direction of a verdict. The appellant urges that this question ought to have been submitted to the jury, but it seems to us not. There was no dispute as to the facts. The history of the transaction, from the date when the president signed the contract down to and after the meeting of the directors and stockholders at which the auditor’s statement was presented, seems to be complete. No part of it is in conflict, and therefore it was proper for the court to determine what conclusion of law should follow from the undisputed facts.

The judgment should be affirmed, with costs. All concur.