Court Opinion

ID: 8822243
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:36:22.956903+00
Date Added: 2024-06-11T17:04:40.301943
License: Public Domain

DAVIS, Circuit Judge
(dissenting). In the final analysis the decision in this case rests upon ratification. If the plaintiff in error, expressly or impliedly, ratified the contract, called the “supplemental agreement,” that ends this appeal. The agreement was entered into, without the approval or permission of the court, by two ancillary receivers, who were former officers of the corporation but whose terms of office had expired. In violation of the court’s order and without necessary antecedent authority, required by the by-laws, they pretended to act for the corporation and also for the court as receivers in executing this agreement. While it was not established that in making this contract there was legal fraud and the plaintiff in error had to abandon that allegation on this appeal, yet in the light of all the facts, this transaction, as well as some others, was, at least, questionable and certainlv improvident. If the Standard Roller Bearing Company had been a “going concern” or an individual, the conclusion of this court (in my opinion) would be justified, but to hold that the corporation, under the disability placed upon it by the court’s injunctive order, may ratify by implication because it obeyed that order is, in effect, penalizing obedience. This is a novel proposition and not sustained by any adjudicated case to which my attention has been called.
Therefore I am constrained to dissent from the conclusion of my colleagues.