Case Name: Grant B. Taylor, Resp't, v. P. Elbert Nostrand, App'lt
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1890-12-08
Citations: 35 N.Y. St. Rep. 332
Docket Number: 
Parties: Grant B. Taylor, Resp’t, v. P. Elbert Nostrand, App’lt.
Judges: 
Reporter: New York State Reporter
Volume: 35
Pages: 332–335

Head Matter:
Grant B. Taylor, Resp’t, v. P. Elbert Nostrand, App’lt.
(Supreme Court, General Term, Second Department,
Filed December 8, 1890.)
Corporations — When director liable for services performed for.
Plaintiff was directed by defendant, who was a director, secretary and engineer of a water company, to procure contracts for lands for such, company, pursuant to a resolution of the company. Subsequently, he was directed by defendant to take such contracts in the name of one A. as trustee, for which direction no authority of the company was clearly shown. Held, that by reason of such change plaintiff had no claim on the company for his services and that defendant was liable therefor.
(Pbatt, J., dissents.)
Appeal from judgment in favor of plaintiff, entered on the report of a referee.
This action was brought by the plaintiff to recover for services rendered by the plaintiff in securing options or contracts for the purchase of real estate in the town of Highlands, Orange county, JST. Y. The defense was a general denial, and also that the services were not rendered to the defendant, but to the Bamapo Water Company. The issues thus raised were referred to a referee, who decided in favor of the plaintiff, upon which report judgment was entered, and from which defendant appeals. Under a ■stipulation, the value of the services as found by the referee are conceded to be correct, and no appeal is taken therefrom, the appeal being confined simply to the question whether on the proof made the defendant is liable. The evidence shows that on the 14th of •January, 1889, the defendant wrote the plaintiff a letter requesting him to call on him in New York, with reference to “ our water mattersthat in response to such letter the plaintiff did go 'to New York and there saw the defendant and one Lamont, and received instructions from them to secure contracts for the conveyance of lands in the town aforesaid ; that in pursuance of such instructions from time to time, extending over a period of two months, the plaintiff was almost continually employed in securing these contracts; that he almost daily reported the result of his negotiations, and received directions in whose name to make the contracts. Twelve contracts were executed, but not one was 'taken in the name of the Bamapo Water Company. On the contrary, by direction of the defendant or with his approval, all were made in the name of “.William S. Andrews, Trustee.” A resolution of the water company was offered in evidence directing •contracts to be made in the name of the company, but no authority was shown for the contracts being made in any other name, save a statement of Lamont. He says, “ The taking of the contracts in the name of William S. Andrews, trustee, or individually, was never authorized by the Bamapo Water Company in any way, except by myself, the fully'authorized agent of the Bamapo Water Company.” No evidence on the part of the defendant of the agency of Lamont was given, nor was Andrews’ connection with the company in any way shown. The contracts were under seal, and the ■company’s directions included the sealing of them for it.
The defendant offered in evidence a certificate showing that "the articles of incorporation of the Bamapo Water Company had been filed with the secretary of state, but no evidence was offered of their having been filed in the county where the business was proposed to be carried on.
The referee decided that the plaintiff had knowledge that he was employed by the Bamapo Water Company, but that in di recting the contracts to be made and sealed in the name of Andrews as trustee the defendant exceeded his authority, and is", therefore, liable to the plaintiff for his services. He- also found that the defendant had failed to show that his alleged principal, the Eamapo Water Company, was a duly organized corporation, and that he was also personalty liable on that ground.
James S. Allen, for app’lt; Howard Thornton, for resp’t.

Opinion:
Barnard, P. J.
It seems clear from the evidence that theEamapo Water Company was nothing but an appearance. The defendant was in point of fact all there was of it except the form of a certificate of incorporation which was filed in the secretary of state's office. The defendant was the promoter of the undertaking or at least an important member of the company who were promoting the enterprise. The defendant was employed to take title or options for land in the name of the company. He did take the same in the name of one Andrews as trustee. No authority was shown given by the company creating Andrews trustee or authorizing the title or contract to be taken in his name. The defendant directed the change and the lands affected thereby were the lands in and about which the plaintiff rendered the service. The defendant justifies the change by reason of the direction of one Lamont No sufficient power to direct the change was proven in Lamont. He testifies that he was authorized, but no resolution of any board of directors or trustees was proven to that effect. No doubt it was safer for the promoters to have control of the-contracts, and in the unsettled state of the company the defendant and Lamont made a change of the mode of transfer which was at first prepared. By the change the plaintiff had no claim on the company and as a consequence thereof he has one against the defendant, who ordered the change.
The judgment should therefore be affirmed, with costs.
Dykman, J., concurs.