Warren v. Littleton Orange Crush Bottling Co., Inc.
| Decision Date | 08 March 1933 |
| Docket Number | 100. |
| Citation | 168 S.E. 226,204 N.C. 288 |
| Parties | WARREN v. LITTLETON ORANGE CRUSH BOTTLING CO., Inc. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, Halifax County; Clayton Moore, Special Judge.
Suit by N.W. Warren against the Littleton Orange Crush Bottling Company, Incorporated. From a judgment of nonsuit, plaintiff appeals.
New trial.
Corporation which profited by extension of time within which it could pay its note could not retain benefit of agreement and at same time repudiate its obligation thereunder.
On November 14, 1929, the defendant purchased property from the plaintiff at $32,000, and made a mortgage reciting the payment of $12,000 in cash or other securities and the execution of notes for $20,000--one for $2,000 and six for $3,000 each. The note for $2,000 was paid at maturity. On October 31, 1931, the parties entered into negotiations for an extension of time for the payment of the note next due. The purported agreement of October 31 is as follows:
There is evidence that the defendant complied with the contract except as to the payment of $720. The plaintiff testified that the $720 item represents the interest on the $12,000 notes, "their individual notes." The individual notes were made to the plaintiff: $5,000 by C. E. Carter, $5,000 by Mrs. Bena Crockett, and $2,000 by Dr. Carter.
The plaintiff brought suit to recover judgment for $720, and at the close of his evidence the court intimated that he could not recover. The plaintiff took a nonsuit and appealed.
Julian R. Allsbrook, of Roanoke Rapids, and Cromwell Daniel, of Littleton, for appellant.
George C. Green, of Weldon, for appellee.
The only question is whether the evidence construed most favorably for the plaintiff should have been submitted to the jury. The notes referred to in the contract were given for the purchase of property necessary for the prosecution of the defendant's business, and the contract under consideration was incidental to the business. Being incidental, if it was authorized, and was properly executed, the contract is binding on the defendant. Fowle Memorial Hospital v. Nicholson, 189 N.C. 44, 126 S.E. 94.
The corporate seal was not necessary. In Mershon & Co. v. Morris, 148 N.C. 48, 61 S.E. 647, 648, the court, after saying that the ancient rule that a corporation could act only by its corporate seal has been greatly relaxed in later times, if, indeed, not wholly abrogated, approved the following quotation from 10 Cyc. 1003: "Excluding the operation of express statutes, a very extensive principle of the law of corporations, applicable to every kind of written contract executed ostensibly by a corporation, and to every kind of act done by its officers and agents professedly in its behalf, is that, when the officer or agent is the appropriate officer or agent to execute a contract or do an act of a particular kind in behalf of the corporation, the law presumes a precedent authorization, regularly and rightfully made, and it is not necessary to produce evidence of such authority from the records of the corporation, always provided that the corporation itself had the power, under its charter or governing statute, to execute the contract or do the act."
We find nothing in the evidence which as a matter of law rebuts the presumption of previous authorization. The plaintiff testified that he had attended a meeting of the directors held with reference to the agreement on October 29. The defendant had five directors; only four of them attended the meeting; Mrs. Crockett had not been notified and did not attend. The defendant insists that as there is no evidence of by-laws fixing the time and place of the meeting any pretended authorization of the contract by the directors is void, and, for this position it cites Bank v. Lumber Co., 116 N.C. 828, 21 S.E. 948. In that case it was shown that...
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