Court Opinion

ID: 6995479
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:32:28.095071+00
Date Added: 2024-06-11T16:09:45.586108
License: Public Domain

Mr. Justice Boggs delivered the opinion of the Court. The case was before us at a prior term upon appeal by the present appellant. We then reversed a former judgment against the company. (49 Ill. App. 180.) The evidence upon the former hearing as to the expenditures of money upon the faith of the subscription and in furtherance of its purpose was the same as in the present record and is not contradicted. We held then that it sufficiently established a consideration for the undertaking and are still of the same opinion. The evidence on the former hearing was too meager to enable us to determine whether the promise was ultra vires. The record now discloses the business the company was engaged in transacting, and the location of its place of business with reference to the proposed site of the post office. And it further appears that the appellant is a corporation chartered under the general laws of the State for the purpose of, and when the subscription was made was engaged in, manufacturing and dealing in saddlery, hardware, leather, shoe findings and vehicles. That its capital stock was $100,000, and that its place of business adjoined the post-office site on the Blodgett lots. Upon the authority of the rule announced, and adopting the reasoning of our Supreme Court in Richelieu Hotel Co. v. Mil. Encampment Co., 140 Ill. page 263, we are inclined to hold it within the corporate power of the appellant company to devote its funds to the purpose designed to be accomplished by the subscription in question. When the case was considered by us on the former hearing the only evidence bearing upon the issue of fact made under the plea of non est factum was that B. ■ S. Green, president of the company, signed the name of B. S. Green Co. to the instrument sued upon and that the company was one organized for pecuniary profit. We then held, through Mr. Justice Pleasants, that the proof was not sufficient to bind the company to the performance of the undertaking in question. The record before us contains much additional proof pertinent to this point. It appears now that the B. 8. Green Co. has a capital stock of $100,000 divided in shares of $100 each, of which B. S. Green owns 897 shares, Marshall J. Green 100 shares and B. D. Lucas three shares. And further that B. S. Green,who attached the corporate name to the instrument in suit, was not only the owner of practically nine-tenths of its capital stock, but was its president, treasurer, and general manager of its business. That his brother, who owned substantially the remainder of the stock, was a clerk in charge of one of the departments of the company’s business and secretary of the company. That the remainder of the stock, three one-thousandths part thereof, was owned by an attorney of the company, and that the board of directors was composed of these three stockholders, and held meetings annually only. The company was engaged in manufacturing and selling saddlery, hardware, leather, shoe findings and vehicles, and had its place of business adjoining the site obtained for the post office. These facts have an important bearing upon the question whether the act of the president and general manager in signing the subscription paper was effectual to bind the company. Corporations are bound by the acts of their agents if within the scope of their authority. The location of the post office adjoining the place of business of the company would be of direct financial and business advantage and benefit to it. Many persons, indeed, the people generally residing in the city and the vicinity, would thereby be caused to pass and repass the company’s place of business frequently, and would naturally have their attention attracted to the articles it kept for sale, and to the fact that it was an applicant for the patronage of all who desired or anight have need of the goods it made and sold. The effect would be to bring its business and line of trade prominently before the public, to increase the number of its customers and the amount of its sales, and consequently to add to its gains and profits. It would serve as an advertisement of its business and add to the volume of its trade, as would advertisements in the public newspapers or by way of handbills distributed among the people through the post office, or by signs painted upon fences or otherwise displayed in public places. It is_believed that efforts to attraqt public attention and thus - secure additional trade has become a legitimate part of the business of tradesmen and corporations in nearly all lines of trade and business. Large sums of money are dóvoted to this purpose annually by firms and managers of corporations. Such outlays are now regarded as part of the legitimate expenses of a firm or corporation engaged in selling wares to the public as fully as the cost of advertising in the newspapers, of rent; insurance, clerk hire, taxes, etc. A contract made by the general manager of a business corporation of the character and capital of the appellant company with a public newspaper to advertise the business of the firm, or with a signwriter to paint or post signs in conspicuous places on the lines of highways or railroads, or in other ways to bring its business prominently before the public, would properly be regarded as within the scope of his authority and power as an agent of the company. Much greater sums than that agreed to be paid by the subscription in the case in hand are often appropriated by judicious business managers to the matter of advertising. It seems to us that the promise sued upon was clearly a reasonable exercise of the power possessed by the president, treasurer, and general manager of the appellant company, and that the corporation he represented ought to be held liable for his contract, which was so well calculated to secure to it additional customers, more extended trade and greater gains and profits. We do not think it indispensable that the corporate seal should be attached to the writing. The doctrine of the common law that a corporation spoke alone by its seal is-practically obsolete. It has been superseded by the modern and more reasonable rulé that its seal is only necessary when a seal would be required if an individual was acting instead of a corporation. 4 Amer. and Eng. Ency. of Law, 242. New Athens v. Thomas, 82 Ill. 259. The judgment is clearly right upon the merits and we think no principle of law demands its reversal. It will be affirmed.