McElroy v. Minn. Percheron Horse Co.
| Citation | 96 Wis. 317,71 N.W. 652 |
| Parties | MCELROY ET AL. v. MINNESOTA PERCHERON HORSE CO. |
| Decision Date | 21 May 1897 |
| Court | United States State Supreme Court of Wisconsin |
OPINION TEXT STARTS HERE
Appeal from circuit court, Winnebago county; George W. Burnell, Judge.
Action by James McElroy and others against the Minnesota Percheron Horse Company. From a judgment for defendant, plaintiffs appeal. Reversed.
Defendant corporation was organized under the laws of the state of Minnesota, among other things, for the purpose of buying, selling, and dealing in real estate. Its principal place of business, by the articles of organization, was located in the town of Troy, Pipestone county, Minn. The business was actually transacted, mostly, at the residence of the president in Milwaukee or Oshkosh, Wis. The principal property of the corporation on the 23d day of November, 1893, was a farm, and some live stock and other personal property thereon, in Pipestone county, Minn. On the date mentioned, George M. Paine, the president of the company, visited plaintiffs, who were real-estate agents in the city of Chicago, and entered into a written agreement with such agents to the effect that the corporation would pay such agents $3,750 to effect a trade whereby the Pipestone farm property could be exchanged for some Chicago real estate, particularly described in the contract, and upon terms therein specified. Plaintiffs thereafter obtained a binding agreement on the part of the owners of the Chicago property to make such exchange, and notified the defendant thereof. It refused to carry out the contract or to pay plaintiffs, and thereupon they sued for their commission. The complaint set forth a good cause of action for such commission. Defendants answered, among other things, that George M. Paine, the president of the corporation, had no authority to make the contract with plaintiffs, and that such contract was not binding upon the defendant. The evidence established plaintiffs' right to recover unless defeated under that part of the answer particularly referred to. The evidence showed that George M. Paine owned 994 shares of the stock of the corporation, or all of the stock except 6 shares, which were owned by other persons principally for the purpose of having a sufficient number of officers to fill the offices and keep up the corporate organization; that Paine was substantially the only person pecuniarily interested; that he had principally transacted its business for a long time and without objection on the part of the persons holding the 6 shares; that in the making of contracts it had not been customary to authorize them by action of the board of directors, but for Paine to conduct the business without previous special authority; that the farming business had been conducted at a loss for some time, and that it was desired to dispose of that property; that to that end the contract of employment made with plaintiffs was entered into by Paine on behalf of the corporation, but that there was no action on the part of the board of directors or stockholders of the company authorizing such contract. Such contract contemplated an exchange of practically all of the corporation property for the Chicago real estate. Negotiations with the agents had been carried on from time to time for upwards of a year in regard to exchanging the Minnesota farm property for other property. At the close of the evidence the defendant moved the court for a nonsuit, which was granted, and plaintiffs' counsel excepted. Judgment was entered in favor of the defendant, from which this appeal is taken.Barbers & Beglinger, for appellants.
Felker, Stewart & Felker, for respondent.
MARSHALL, J. (after stating the facts).
The first question that requires consideration is, was the contract of employment, made with plaintiff to negotiate an exchange of the corporate property in Pipestone county, Minn., for Chicago real estate, ultra vires? That must be answered in the negative. The articles of organization expressly provide, among the purposes of the corporation, that of dealing in real estate...
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