Long v. Georgia Pac. Ry. Co.

• Decision Date: 26 January 1891
• Citation: 91 Ala. 519,8 So. 706
• Parties: LONG v. GEORGIA PAC. RY. CO. JONES ET AL. v. SAME.
• Court: Alabama Supreme Court

8 So. 706

91 Ala. 519

LONG v. GEORGIA PAC. RY. CO.

JONES ET AL. v. SAME.

Supreme Court of Alabama

January 26, 1891

Appeal from chancery court, Walker county; THOMAS COBBS, Judge.

Hewitt, Walker & Porter and Coleman &amp McIntyre, for appellant.

James Weatherly, for appellee.

McCLELLAN J.

The case made by the amended bill is this: On April 23, 1883, the complainant, B. M. Long, and his wife, Amanda C. Long executed to the Georgia Pacific Railway Company a deed, upon valuable consideration presently paid, to and of the iron coal, an oil interests and properties in and pertaining to certain tracts of land, aggregating about 4,000 acres, the said Long retaining the fee to said lands, except in respect to said mineral interests, and continuing in possession thereof. The grantee is a corporation, and was and is without power to purchase and hold said land, or the mineral interest in the same. The bill seeks to have the deed declared void because of this incapacity of the corporation, and to have the same canceled as a cloud upon complainant's title. The bill was demurred to on several grounds, and the demurrer was sustained generally, the decree to that end being now assigned as error. Only those grounds of demurrer which present the question whether a vendor who has sold, received payment for, and conveyed land to a corporation, which had no power to purchase or hold the same, can have any relief in respect to the transaction, are discussed in argument, and to these our consideration will be confined; since it is manifest that a determination of this question in line with the decree below, as we think it must be determined, will be fatal, not only to the present appeal, but to complainant's cause of action. It is thoroughly well-settled law that a party to an ultra vires executory contract, made with a corporation, is not estopped to set up the want of corporate capacity in the premises either by the fact of contracting, whereby the power to contract is in a sense admitted or recognized, or by the fact that the fruits or issues of the contract have been received and enjoyed; and this, though the assault upon the transaction come from the corporation itself. Bank v. Dunkin, 54 Ala. 471; Chambers v. Falkner, 65 Ala. 448; Sherwood v. Alvis, 83 Ala. 115, 3 South. Rep. 307; Lime-Works v. Dismukes, 87 Ala. 344, 6 South. Rep. 122. But where the contract is fully executed, where whatever was contracted to be done on either hand has been done, a different rule prevails. In such case the law will not interfere, at the instance of either party, to undo that which it was originally unlawful to do, and to the doing of which, so long as the contract to that end remained executory, neither party could have coerced the other. As declared by Mr. Bishop, "the parties' voluntary doing of what they had unlawfully agreed places them, in effect, in the same position as if the contract had been originally good; neither can recover of the other what was parted with; the reason for which is that, since they are equally in fault, the law will help neither." Bish. Cont. § 627. The former decisions of this court are in line with this doctrine, and fully recognize the distinction between executory and executed void contracts, to the effect that, while suits to enforce the former may always be defended on the ground of their invalidity, no relief prayed upon such ground can be granted with respect to the latter. Morris v. Hall, 41 Ala. 510; Ingersoll v. Campbell, 46 Ala. 282; Sherwood v. Alvis, 83 Ala. 115, 3 South. Rep. 307; Dudley v. Collier, 87 Ala. 431, 6 South. Rep....