24 East Sixth St. Corp. v. Co-Operative Pure Milk Ass'n, No. A-99701.

CourtCourt of Common Pleas of Ohio
Writing for the CourtMACK
Citation79 N.E.2d 239
Docket NumberNo. A-99701.
Decision Date17 February 1948

79 N.E.2d 239


No. A-99701.

Court of Common Pleas of Ohio, Hamilton County.

Feb. 17, 1948.

Action by 24 East Sixth Street Corporation against the Co-operative Pure Milk Association to recover judgment for certain amount against defendant on its guarantee as surety for prompt payment of all rent and performance of all covenants and agreements of lease by plaintiff to a third party. On demurrer by plaintiff to second defense of defendant's amended answer.

Demurrer overruled.

[79 N.E.2d 239]

Rendigs & Fry and Herbert E. Ritchie, both of Cincinnati, for the demurrer.

Harry Kasfir and Orville Troy, both of Cincinnati, for defendant.

MACK, Judge.

Plaintiff's second amended petition alleges that it is the owner of premises at 24 East Sixth Street, Cincinnati, and that it entered into a renewal lease with Kirschner Restaurants, Inc., as lessee, for the entire second floor of said premises and for certain basement storage space and use of elevator, halls and stairways for one year from October 1, 1944, and from year to year thereafter unless terminated as provided in such lease.

[79 N.E.2d 240]

It is further alleged that the defendant, Co-operative Pure Milk Association, executed its guaranty whereby it became surety for the prompt payment of all rent and the performance of all the covenants and agreements of said lease, and that it would pay all damage that may be occasioned by non-performance of such lease.

It is further alleged that said Kirschner Restaurants, Inc., gave notice of the termination of said lease on July 31, 1945; that said lessee failed to make repairs and to deliver possession as required by the lease; that by reason thereof plaintiff has been damaged in the sum of $12,001.49 for which plaintiff prays judgment against defendant.

To such second amended petition defendant filed its second amended answer. As a first defense there is a denial of failure on the part of Kirschner Restaurants, Inc. to perform the terms of its lease.

As a second defense defendant alleges it is a co-operative agricultural association under the laws of Ohio and after stating in detail the purposes of defendant corporation, defendant alleges that it was outside of the power of defendant corporation to execute the guaranty referred to in the second amended petition and that it was ultra vires and outside the corporate powers of defendant to become surety on the lease of another corporation.

To such second defense of said amended answer a demurrer is filed and the following provision of the General Corporation Act of Ohio is relied upon, viz.:

‘No limitation on the exercise of the authority of the corporation shall be asserted in any action between the corporation and any person, except by or on behalf of the corporation against a director or an officer or a person having actual knowledge of such limitation.’ (112 Ohio Laws, 9 et seq., G. C. Sec. 8623-8).

In the consideration of the matter involved herein it is well to bear in mind the following expression of our Supreme Court per Stephenson, J., contained in Cleveland v. Public Utilities Commission, 130 Ohio St. 503, at page 510, 200 N.E. 765, at page 769:

‘Words contained in a legislative...

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