Jones v. Cincinnati Type Foundry Co.
| Decision Date | 28 May 1860 |
| Citation | 14 Ind. 72 |
| Parties | Jones v. The Cincinnati Type Foundry Company |
| Court | Indiana Supreme Court |
From the Grant Circuit Court.
The judgment is affirmed with 5 per cent. damages and costs.
H. S Kelley, for appellant.
Suit upon a promissory note.
"The Cincinnati Type Foundry Company, a corporation," &c., "complains of David W. Jones, defendant," &c., upon a promissory note, of which a copy is set out thus:
The defendant demurred to the complaint. The demurrer was overruled, and rightly.
The defendant then answered--
1. That he was not indebted to the plaintiffs.
2. That each and every allegation of the complaint was untrue.
3. That the plaintiffs had not a legal capacity to sue, because not a corporation.
Issue. Trial. The note constituted all the evidence. Judgment for the plaintiffs on the note.
The appellant contends that the case was not made out against him, because it was not proved that the appellees were a corporation and thus possessed of the capacity to sue.
The appellees insist that the note sued on is a contract with them as a corporation and that their existence is thereby admitted.
As a general proposition, it is the law of this state that a contract with a party as a corporation estops the party so contracting to deny the existence of the corporation at the time it was contracted with as such. Hubbard v. Chappel, post, 601.
And it has been held in other states that where individuals are incorporated upon performance of certain acts, a person who contracts with them by their corporate name, cannot, in an action against him on the contract, deny the performance by them of the acts necessary to give them a corporate existence. Hamtramck v. The Bank of Edwardsville, 2 Mo. 169.--Tar River Navigation Co. v. Neal, 3 Hawks 520. See 1 U.S. Dig., 593; 4 id. 433.
In New York, to work such estoppel, it has been necessary that the contract should state that the party contracted with was a corporation. But this rule does not prevail in other states. It has not been acted upon in this state.
If the style by which a party is contracted with is such as is usual in creating corporations, viz., naming an ideality, but disclosing that of no individual, as is usual in the cases of simple partnerships, it has been treated as prima facie, at least, indicating a corporate existence. And such seems to have been the rule at common law. Grant on Corp., 62. Probably, a special answer, in such cases, in the nature of a plea in abatement, might, at the proper time be made available. See Ang. and Ames on Corp., 506, 507, and the numerous cases in our own reports.
And there is no hardship in this. The party executing the note, owes the amount of it. The judgment upon it in the suit merges it, and the payment of the judgment satisfies it, and bars any other action against the maker for the money.
But, in this class of cases it would seem, after all, that the Courts have proceeded upon a rule of evidence, rather than the strict doctrine of estoppel. They have treated the contract with a party by a name implying a corporation, really as evidence of the existence of a corporation, more than as an estoppel to disprove such fact. Grant, in his late learned work on Corporations, says:
The doctrine of conclusive estoppel seems more properly applied to cases involving the question of legality of organization, where the fact of an existing statute, authorizing, in the given case, such corporation, is known to the Court, either by judicial notice or actual evidence in the cause.
In such cases, where a party has contracted with a body as being organized as a corporation under the law, he will be estopped to dispute the legality of the organization. See the cases cited in the U.S. Dig., and Ang. and Ames, ubi supra.
This doctrine of estoppel, as applied to contracts with corporations, needs further examination; but it is not important in this case and we shall not here pursue it. The decision of this case will rest upon another ground.
It is well settled law in this state, that the general denial, by the defendant, of the cause of action stated in the complaint of the plaintiff,...
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