Tuttle v. Junior Building Corp.

Seawell, J.

The defendant contends that the interchanges between the parties as above set out do not constitute a binding contract for the sale of the lands in question for that those who dealt with the plaintiff in the acceptance of his offer had no authority to make such contract, and that this want of authority appears so definitely in plaintiff’s evidence as to support a judgment of nonsuit.

This want of authority, it is claimed, appears in this way: Inasmuch as the building and lot in controversy constituted the entire property of the corporation it could only be conveyed on approval by a two-thirds vote of its stockholders, which the record does not disclose to have been given, G. S., 55-26.11; and that in any event the property could not have been conveyed except by specific corporate action upon a vote of at least a majority of the directors, and that no such meeting was held and no such majority vote obtained.

As to the first contention, construing the charter of defendant, it appears that it has general power to buy and sell real estate as its regular business and the specific mention of the Junior Order Building and lot does not exempt it from such power or segregate it from such property acquired generally for such purpose. The defendant occupied no part of it. It was not used for a permanent office, home or other facility in carrying on the business in which it vras engaged or in which it might engage, but was a part of its stock in trade. Hence G. S., 55-26.11, has no application to its contemplated sale.

G. S., 55-26.9, gives the power “to sell, transfer and convey any part of its corporate property in the course of its regular business.” G. 3., 55-26.10, empowers a corporation (applying to corporations generally) “to sell, transfer and convey any part of its corporate real or personal property when authorized so to do by its board of directors.”

"Whether there is intended a distinction between subsections 9 and 10 wdiich would relieve a corporation trading in real estate as a regular business from the necessity of calling on the directorate for authority for each particular sale we need not inquire. Under the agency doctrine authority to make a valid contract of sale may be referable to or implied from other considerations to which, when present, it was not the purpose of section 10 to apply an overall restriction. Williston on Contracts, Sec. 271.

But aside from tbis, plaintiff’s right to go to the jury on the evidence presented would not be defeated,- even considering that the authority to make a binding sales contract must depend, ultimately, on action by the board of directors, either by specific or general delegation of powers, however or whenever conferred.

It is assumed by appellee that the meeting of the stockholders and directors mentioned in the evidence, at which the plaintiff was informed that his offer had been accepted and at which certain details as to the rental of offices in the building were agreed upon, was the only meeting at which any action by the directors could have been taken. That is not a necessary inference. Prior to that meeting the plaintiff had been informed that his offer had been accepted and that statement was repeated to him in the meeting which he attended as a conferee.

But we do not think that the right of the plaintiff rests upon this narrow ground. Under the Agency Doctrine the apparent authority of the officers of the corporation with whom the plaintiff dealt may have been derived, and in trading corporations of this kind usually is derived, from sources other than formal action of the directors on each particular offer as made; and the supposed defect in plaintiff’s evidence is not of such a nature as to relieve the defendant from establishing its defense. Williston on Contracts, Vol. 1, Sec. 271, pp. 786, 787.

The plaintiff dealt directly with responsible officers of the corporatioh. The offer and its acceptance by them was complete in every detail. But the evidence of plaintiff goes much further. Notwithstanding much of the evidence relating to the transaction was rejected on objection by defendant, enough remains which tends to show that a deed was properly executed by officers of the'corporation, designated by statute, and by agreement was put in escrow at the State Planters Bank to be lifted by the plaintiff on payment of the balance of the. purchase price, $500 having already been paid and accepted. He promptly appeared at the bank and paid in the money, but was informed the deed had been withdrawn. He was subsequently informed that defendant had “changed its mind.”

If the instrument thus put in escrow was what the evidence tends to show that it was — a deed — it bore the seal of the corporation and raised the presumption that it was executed by authority. Fletcher, Cyc. Corporations, Vol. 2, sec. 486, et seg.

At this point it is not necessary for us to go into the question of authority, or power, to withdraw the deed from escrow without consent of the plaintiff. We say, however, that from the circumstances detailed in the evidence there is an inference of authority to make a binding contract not negatived by anything we find in plaintiff’s evidence, con sidered in its most favorable light, and the evidence ought to have been submitted to the jury. The judgment of nonsuit is, therefore,

Eeversed.