Appeal
from circuit court, Wayne county; HENRY N. BREVOORT, Judge.
LONG
J.
Plaintiff
in the year 1883, was a dealer in grain and produce, residing
at Mason, in this state. Defendants were the sole parties
interested in a business of buying and selling grain and
provisions for immediate and future delivery for themselves
and other persons on commission at Detroit, and were members
of the Board of Trade of Detroit. This action is brought upon
an account stated by defendants to plaintiff in the sum of
$3,562.68. The account was erroneously made out in the name
of the firm of Walker, Summer & Co., with whom plaintiff had
formerly done business, and of whom Mr. Walker was at that
time a member. No question was made on the trial as to the
amount due the plaintiff from Walker, Hopkins & Co., but the
defense rested on the single ground that
Walker, Hopkins & Co. were a corporation, and not liable as
individuals. The cause was tried before the court without a
jury, and the court made the following finding of facts and
conclusions of law:
"(1)
On the 3d day of May, 1882, the defendants organized a
corporation under the name of Walker, Hopkins & Co. by
executing articles of association, and having the same duly
filed in the offices of the clerk for the county of Wayne
and the secretary of state for the state of Michigan. The
object of such corporation, as described in such articles
of association, was 'to carry on mercantile business in
buying and selling grain for immediate or future
delivery.' (2) This corporation assumed to organize
under act No. 187 of the Session Laws of 1875, as amended
by act No. 274 of the Session Laws of 1881. The capital
stock of the corporation was filed at $50,000; each of the
defendants subscribing for an equal portion of the same.
(3) The defendants Livingston and Hopkins paid for their
stock. The defendant Livingston, on the 6th of May, 1882
paid $10,000 on account of his stock; on the 29th day of
May, $1,000; 1st day of June, $1,000; on the 12th day of
July, $325; on June 9, 1883, $1,000; and on July 25,1883
$1,675. The defendant Hopkins paid for his stock in cash at
or about the time of the organization of the corporation.
(4) Prior to the organization of the corporation, a
copartnership, of which the defendant Charles H. Walker was
one of the copartners, conducted a business in buying and
selling grain, and doing a general commission business,
under the name of Walker, Summer & Co. Neither the
defendant Hopkins nor the defendant Livingston was
connected with this copartnership. Prior to the
organization of the corporation of Walker, Hopkins & Co.,
the defendant Walker purchased all the assets of the firm
of Walker, Summer & Co., and transferred such assets to
Walker, Hopkins & Co.; and agreement being executed between
the defendant Walker and Walker, Hopkins & Co. providing,
in effect, that the stock of the defendant Walker should be
paid for out of collections to be made out of the assets
thus transferred to Walker, Hopkins & Co.; but it does not
appear that collections to any considerable amount were
ever made upon the assets thus transferred
to Walker, Hopkins & Co., or that the stock of the
defendant Walker was ever paid for. (5) Soon after the
organization of the corporation of Walker, Hopkins & Co.,
as above stated, it commenced to do business as a
corporation in buying and selling grain and provisions for
immediate or future delivery; the defendant Mark Hopkins,
Jr., having been elected president of the corporation, the
defendant Walker secretary and treasurer, and defendant
Livingston vice-president. The three defendants herein were
elected a board of directors, and records of the meetings
of such corporation were duly kept, a corporate seal had
and used, and regular stock certificates issued, and the
fact of its incorporation duly announced through the
public press and by circular. Such business was continued by
said Walker, Hopkins & Co., as such corporation, till the
27th day of July, 1888, when it made an assignment for the
benefit of its creditors to Charles M. Swift as assignee, who
qualified as such assignee, and executed the trust under such
assignment so made by such corporation. (6) The business of
said corporation during the time it so conducted said
business was managed by the defendants Hopkins and Walker as
president and secretary and treasurer of said corporation.
The defendant Livingston took no part in the transaction of
the ordinary business of the corporation. (7) The plaintiff,
who had been a customer of the firm of Walker, Summer & Co.,
upon the organization of the corporation of Walker, Hopkins &
Co. continued to do business with it as he had done business
with Walker, Summer & Co. prior to the organization of
Walker, Hopkins & Co. (8) At the date of the execution of the
assignment aforesaid, Walker, Hopkins & Co. was indebted to
the plaintiff in the sum of $3,562.68. (9) At the time
Walker, Hopkins & Co. commenced business as aforesaid, and
during the time it continued to do business, the plaintiff
had full notice that Walker, Hopkins & Co. was a corporation
and not a copartnership, and he continued to do business with
said Walker, Hopkins & Co. as such corporation. (10) That the
plaintiff transacted his business with Walker, Hopkins & Co.
as a corporation, and the indebtedness sued for herein was
contracted while said plaintiff was dealing with said Walker,
Hopkins & Co. as such corporation. (11) The
defendant Livingston became a party to the organization of
said corporation of Walker, Hopkins & Co., and a subscriber
to its stock, in entire good faith, and all his dealings had
with said corporation were had in good faith, and he never
after the organization of said corporation received, directly
or indirectly, any benefit therefrom by way of return of
stock subscribed and paid for, or dividends thereon, and
never at any time while said corporation continued to do
business had any suspicion that the organization of said
corporation was in any wise defective.
"CONCLUSIONS
OF LAW.
"Whether
act No. 274 of the Session Laws of 1881, under which the
corporation of Walker, Hopkins & Co. assumed to organize, was
a valid law or not, by reason of the alleged defect or
imperfection in its title, the plaintiff is not entitled to
recover in this cause. The defendant Livingston having acted
in good faith with reference to the organization of said
corporation and the transaction of its business, and the
plaintiff having dealt with it as a corporation, he is now
estopped to a question the validity of its incorporation. The
defendants are entitled to judgment."
The
court subsequently filed the following conclusions:
"From these facts found, I am clearly of opinion that
Walker, Hopkins & Co., with whom the plaintiff dealt, and by
whom the account was rendered, was a corporation de
facto, if not de jure, and that the plaintiff
knew that Walker, Hopkins & Co. was a corporation. He never
dealt with them as partners, and under the weight of
authority I think the plaintiff is estopped to deny that
Walker, Hopkins & Co. was a corporation, or to claim that the
defendants, who were stockholders therein, are liable as
partners."
Judgment
was entered upon these findings in favor of defendants.
Plaintiff brings the case to this court.
The
defendants claim to be incorporated under act No. 187 of the
Public Acts of Michigan of 1875. The title of this act is
"An act for the incorporation of manufacturing
companies." The first section authorizes
a number of persons, not less than three, to associate
according to the provisions of the act, "for the purpose
of engaging in and carrying on any kind of manufacturing
business, and who shall comply with all the provisions of
this act, shall, with their successors and assigns,
constitute a body politic and corporate under the name
assumed by them in their articles of association." Act
No. 187, Pub. Acts 1875. This section was amended by act No.
274, Pub. Acts 1881, so as to read, "for the purpose of
engaging in and carrying on any kind of manufacturing or
mercantile business, or any union of the two;" the act
in other respects being unchanged. The title of the amending
act is "An act to amend section one of an act entitled
'An act for the incorporation of manufacturing
companies,' approved May 1, 1875, being act No. one
hundred and eighty-seven of the Laws of Eighteen Hundred and
Seventy-Five, so as to include mercantile business." The
title of the act of 1875 remains unchanged, and only provides
for the incorporation of manufacturing companies. The act of
1881 provides for the incorporation of companies to carry on
a mercantile business,-a business entirely foreign to the act
of 1875, which it purports to amend,-and therefore
introducing matters not embraced in the purposes indicated in
the title to the act amended. Section 20, art. 4, of the
constitution provides that "no law shall embrace more
than one object, which shall be embraced in its title."
This attempt to incorporate a new business into the act of
1875 by ...
