Union Cement Co. v. Noble

• Decision Date: 30 June 1882
• Parties: UNION CEMENT CO. v. NOBLE and another.
• Court: U.S. District Court — Western District of Michigan

15 F. 502

UNION CEMENT CO. v. NOBLE and another.

United States Circuit Court, W.D. Michigan, Southern Division.

June 30, 1882

James B. Petes and John E. More, for plaintiff.

Hughes O'Brien & Smiley, for defendants.

WITHEY J.

This case is here by removal from a court of the state upon defendants' petition, and has been tried without a jury. The declaration consists of the common counts, and a notice that four promissory notes, of which copies are annexed constitute the cause of action. Plea, general issue. At the outset the notes were offered in evidence, and their admissibility objected to on the ground that under the general issue plaintiff must prove corporate existence to entitle the notes to be read. They were admitted, subject to the objection and the opinion of the court. Then plaintiff rested, and defendant offered evidence to prove that plaintiff was not a corporation at the time the notes were made, nor at any time since. Objection was made to the introduction of the evidence on the ground that the plea of the general issue admits the corporate existence of plaintiff.

The declaration, in the commencement, merely states that 'the Union Cement Company, of Buffalo, New York, plaintiff herein,' by attorney, 'complains,' etc., and does not otherwise aver the fact that plaintiff is a corporation. Was the objection to the admission of the notes well taken? I am of opinion that it was not, and that the notes were properly admitted.

It is not necessary for a plaintiff corporation to allege that it is a corporation in the pleading; it is sufficient to state in the commencement of the declaration the name of the corporation, as was done here, just as the name of a natural person suing is stated. 2 Ch.Pl. (16th Ed.)p. 13, form 22; Woolf v. Steam-boat Co 7 C.B. 103; 2 Ld.Raym. 1535; 4 Black, 267; 16 Ind. 278; 14 Johns. 245.

It is a general rule that a plaintiff need prove only the material allegations of his declaration; therefore, in the absence of an averment of being a corporation, it is not plain why proof should be necessary that the plaintiff is such, unless defendant challenges the fact by plea or notice. But the courts are far from uniform upon the question, and this does not seem to arise from a consideration whether the declaration avers or omits to aver that the plaintiff is a corporation.

In several states the courts hold that a corporation instituting suit upon contract, or to recover land, must upon the trial under the general issue, prove the fact of incorporation. Ang. & A. Corp. Sec. 632, note 3. In many other states the courts hold that a plea of the general issue admits or waives proof of the plaintiff's corporate existence. Ang. & A. Sec. 633, note 1. There is a collection of cases in the notes referred to in Angel & Ames, and also in note g, 1 Ch.Pl. (16th Ed.) 464. Some of the courts hold one rule as to domestic corporations, and another as to foreign corporations. 12 Ohio, 132; 8 Vt. 445; 2 N.H. 310; 6 N.H. 198.

The supreme court of the United States, as early as 1826, in Conard v. Atlantic Ins. Co. 1 Pet. 450, held that by pleading the general issue the defendant necessarily admitted the capacity of the plaintiff corporation to sue, as that is a plea to the merits only. The suit was by a corporation, created under the laws of a state other than Pennsylvania, where it was tried, and was, therefore, a foreign corporation as to Pennsylvania, though in the federal court it would be regarded as a domestic one. In the Society for the Propagation of the Gospel v. Powlet, 4 Pet. 500, the same court said:

'The general issue is pleaded, which admits the competency of the plaintiff to sue in the corporate capacity in which they have sued. If the defendant meant to have insisted upon the want of corporate capacity in the plaintiff to sue, it should have been insisted upon by a special plea in abatement or bar.'

The Society for the Propagation of the Gospel was organized under the laws of Great Britain. The two cases lead to the conclusion that in the federal courts the rule is the same whether the corporation is domestic or foreign. Judge STORY cites 1 Peters, and other American and English decisions.

A statute passed in the state as early as 1846, copied from the statutes of New York, declares that corporations 'created by or under the laws of this state' shall not be required to give evidence of being a corporation unless the question is raised by plea or notice, supported by affidavit. Comp. Laws 1871, Sec. 6547. The courts in New York, prior to such statute there, held that when the general issue was pleaded a plaintiff suing as a corporation must prove corporate existence. The New York statute was enacted in Michigan, manifestly, because it was supposed that, under the plea of general issue, without the statute, it was necessary for a plaintiff corporation to make the proof which the New York courts held to be necessary, prior to the passage of said statute. As early as 1844 the supreme court of Michigan said:

'It is well settled that under a plea of the general issue a corporation must prove all it would be required to prove under a plea of nul tiel corporation. ' 1 Doug. (Mich.) 464.

The suit was by a New York corporation.

In 1850 the same court declared that at common law a plaintiff corporation must make proof of its existence under a plea of the general issue. 1 Mich. 498. It is singular that in neither case did the court take notice of the many cases opposed to the view it asserted to be unquestioned law. But in a suit brought by a corporation organized under the national banking law, and where the general issue was pleaded, the supreme court of Michigan, in 1876, disregarded its former utterances by...