Clement v. Adams Bros.-paynes Co. Inc

• Decision Date: 13 June 1912
• Citation: 75 S.E. 294,113 Va. 547
• Parties: CLEMENT . v. ADAMS BROS.-PAYNES CO., Inc.
• Court: Virginia Supreme Court

75 S.E. 294

(113 Va. 547)

CLEMENT .

v.ADAMS BROS.-PAYNES CO., Inc.

Supreme Court of Appeals of Virginia.

June 13, 1912.

1. Corporations (§ 398^*)—Powers—Officers.

The powers of a corporation, so far as it deals with third persons, are primarily lodged in its board of directors, from which source the officers, expressly or by implication, derive the authority bestowed on them.

[Ed. Note.—For other cases, see Corporations, Cent. Dig. §§ 1592-1594; Dec. Dig. § 398.*]

2. Corporations (§ 398*)—Officers—President— Powers.

The office of president of a corporation confers of itself no power to bind the corporation or control its property, and the power of the president as agent must be conferred by the board of directors.

[Ed. Note.—For other cases, see Corporations, Cent. Dig. §§ 1592-1594; Dec. Dig. § 398.*]

3. Mechanics' Liens (§ 5*)—Statutes—Construction.

The remedial portion of the mechanic's lien statute, providing for enforcing a lien after it is perfected, must be liberally construed, while the portion dealing with the right to the existence of a lien must be strictly construed.

[Ed. Note.—For other cases, see Mechanics' Liens, Cent. Dig. §§ 3, 5; Dec. Dig. § 5.*]

4. Mechanics' Liens (§§ 154, 157*)—Verified Account—Sufficiency of Verification.

Under Code 1904, §§ 2476, 2477, declaring that to perfect a lien an account must be filed, verified by the oath of the "claimant or his agent, " the verification of the account by the claimant or his agent is an essential requirement to the perfection of a lien, and where a corporation is a claimant, a verification by its president is insufficient to perfect a lien, unless the affidavit avers that he is the agent of the corporation for that purpose, and a defect in the affidavit arising from a failure to aver the fact of agency is not within section 2478, providing that no inaccuracy in the account filed or in the description of the property to be covered by a lien shall invalidate the lien.

[Ed. Note.—For other cases, see Mechanics' Liens, Cent. Dig. §§ 261-267, 268-274; Dec. Dig. §§ 154, 157.*]

5. Mechanics' Liens (§ 258*)—Want of Jurisdiction.

Where a court of equity, in a suit to enforce a mechanic's lien, may not enforce a lien for the failure of the claimant to properly verity the account, it has no jurisdiction to afford relief, and the bill must be dismissed.

[Ed. Note.—For other cases, see Mechanics' Liens, Cent. Dig. §§ 452-454; Dec. Dig. § 258.*]

Buchanan, J., dissenting.

Appeal from Circuit Court, Appomattox County.

Suit by the Adams Bros.-Paynes Company, Incorporated, against one Clement. From a decree overruling a demurrer to the bill, and from a final decree for plaintiff, defendant appeals. Reversed, and bill dismissed.

Caskie & Caskie, for appellant.

F. C. Moon, Sackett & Sackett, and R. C. Blackford, for appellee.

HARRISON, J. The bill in this case was filed by the appellee corporation for the purpose of asserting and enforcing an alleged mechanic's lien against certain real estate of the appellant. A demurrer to the bill by the appellant was overruled, and upon the final hearing a decree was entered in favor of a receiver appointed by the court for $367.39, the balance due from the appellant, and provision made for the sale of her property to satisfy the same. From the decree overruling the demurrer, and the final decree, this appeal was allowed.

The first assignment of error is to the action of the circuit court in overruling the demurrer to the bill. The ground of demurrer was that the alleged mechanic's lien was not supported by proper affidavit, and was, therefore, void and of no effect; that in support of an account constituting the basis for a mechanic's lien the statute requires the same to be verified by the affidavit of the "claimant or his agent, " whereas, in this case, the affidavit was made by C. S. Adams, the president of the plaintiff corporation, and contains no averment of any agency on the part of the affiant, and that it cannot be implied that the president of the appellee corporation was, by virtue of his office, its agent to make the required affidavit.

Section 2475 of the Code provides that all lumber dealers and other persons furnishing materials for the construction of any building shall have a lien, "if perfected as hereinafter provided, " upon such building or structure.

Sections 2476 and 2477 provide that, among other steps necessary to perfect such lien, an account shall be filed by the general or subcontractor, as the case may be, showing the amount and character of the materials furnished, the prices charged therefor, the payments made, if any, and the balance due, verified by the oath of the "claimant or his agent."

Adams Bros.-Paynes Company is a corporation, and the language of the affidavit attached to the account which constitutes the basis of the proceeding is that "C. S. Adams, the president of Adams Bros.-Paynes Company, a corporation, this day personally appeared before me in my said city, and, being by me first duly sworn, made oath to the correctness of the foregoing account."

The contention of the appellee, that the president of a corporation is necessarily its agent for the purpose of making the affidavit required in this case, cannot be sustained. The general doctrine is well settled that the powers of a private corporation, so far as its dealings with third persons are concerned, are primarily lodged in its board of directors, from which source the officers, either expressly or by implication, derive such measure of authority as may be bestowed upon them.

With respect to the powers of the president of a corporation it is said: "The office itself, however, confers no power to bind the corporation or control its property. The president's power as an agent must be sought in the organic law of the corporation, in a delegation of authority from it, directly or through its board of directors formally expressed or implied from a habit or custom of doing business." 10 Cyc. 903; 2 Cook on Corp. (5th Ed.) § 716; Morawetz on Private Corp. § 537. See, also, Crump v. U. S. Mining Co., 48 Va. 352, 56 Am. Dec. 116; Hodge v. Bank, 63 Va. 60.

"The implied powers of the president of a corporation depend upon the nature of the company's business and the measure of authority delegated to him by the board of directors. It seems that a president has no greater power, by virtue of his office merely, than any other director of the company, except that he is the presiding officer at the meeting of the board. The Supreme Court of New Jersey said: 'In the absence of anything in the acts of incorporation bestowing special power upon the president, he has from his mere official station no more control over the corporate property and funds than any other director. The affairs of corporate bodies are within the exclusive control of their board of directors, from whom authority to dispose of their estates must be derived.' " 1 Morawetz on Private Corp. § 537.

In the case of Lancaster v. Barton, 92 Va. 615, 24 S. E. 251, where the question was as to the sufficiency of an affidavit to a bill which had to be verified by the oath of the plaintiff, and it appeared of record that the party objecting had shown by his own witness that the bill was signed and sworn to by each of the plaintiffs in his proper person, it was held to be sufficient; the court saying, however, that "the better practice was for the certificate to show on its face that the bill was sworn to by the plaintiff, and not leave that fact to be supplied by evidence aliunde." Since that decision this court has repeatedly held that, if the affiant bore the relation of agent to the plaintiff, the fact must be averred in the affidavit.

In the case of Merriman v. Thomas, 103 Va. 24, 48 S. E. 490, in construing section 3286 of the Code, which provides that, if in an action of assumpsit the account sued on is verified by an affidavit made by "the plaintiff or his agent, " no plea in bar shall be received unless accompanied by a like counter affidavit, this court held that the word "bookkeeper" did not import agency, and that the affidavit of the plaintiff's bookkeeper, without more, was not a compliance with the statute. The court says: "The statute makes an innovation upon the established mode of procedure in such cases, and the plaintiff, in order to take advantage of it must proceed in accordance with its provisions. The affidavit can only be made by the plaintiff or his agent."

The court also in that case quoted with approval 2 Cyclopedia of Law & Procedure, page 5, where it is said, concerning affidavits and who may make them: "In determining this question, reference must always be had to the statutes and the rules of court governing the particular affidavit. Thus, where a statute specifically points out who may make a certain affidavit, it can be made by no other than those specified." The court adds: "If the statute had prescribed that the affidavit should be made by the plaintiff in person, then it could have been made by no one else, and, when it is declared that it must be made by the plaintiff or his agent, the courts must be content to construe the language employed. * * * While a bookkeeper may be, and often is, the agent of his employer, the word does not, ex vi termini, import that relation, and, in the absence of averment in the affidavit that it exists, the courts cannot by intendment enlarge the ordinary signification of the word, so as to bring it within a class to which it may or may not belong."

In the case of Taylor v. Sutherlin-Meade Co., 107 Va. 787, 60 S. E. 132, this court held that it could not say, as a matter of law and in the absence of averment, that the term "secretary and treasurer" necessarily imported the relation of agency between such officer and his corporation, within the intendment of the attachment laws of this state, which require the affidavit to be made by the "plaintiff, his agent or attorney"; that if he was in fact such agent it should...