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Published in December, February, April and June by the faculty and students of the Cornell Law School, Ithaca New York.

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James Leslie Brierly, O. B. E., Chichele Professor of International Law and Fellow of All Souls College, Oxford, will be visiting professor of International Law at Cornell during the second term of the present academic year. He is being brought to Cornell on the Jacob H. Schiff Foundation and will lecture in the Law School. He will reach Ithaca about the middle of March and will stay at Cornell until June.

Professor Brierly received his education at the Haddersfield College School and at Brasenose College, Oxford, where he received his M.A. and B.C.L. degrees. He is also a Barrister at Law of Lincoln's Inn. Professor Brierly was a Fellow of All Souls College, Oxford, from 1906 to 1913 and of Trinity College, Oxford, from 1913 to 1920. From 1920 to 1922 he was professor of law at Victoria University, Manchester, and since 1922 has been Chichele Professor and Fellow of International Law of All Souls College, Oxford.

Among his other public and professional activities, Professor Brierly is the English representative on the International Committee of Jurists which is functioning under the auspices of the League of Nations, studying the possibility of codifying certain branches of international law. In this work he is associated with men of fifteen different nations representing all of the important systems of law, and among his associates is the Hon. George W. Wickersham, who spoke at Cornell last year on the work of this committee. Professor Brierly is one of the foremost scholars and teachers in the field of International Law in England at the present time.

Agency: Promoter: Liability of a self-styled agent where the corporate principal is known to be non-existent, but is falsely alleged to be in the process of formation.-In Weiss v. Baum, 217 N. Y. Supp. 820 (2d. Dept. 1926), the action was for specific performance of a contract to buy real estate. The defendant, Baum, at the time of making the contract, had falsely and fraudulently represented to the plaintiff that a corporation to be called the Ruth Realty Corporation was then being formed. The parties to the contract were recited therein at the outset to be Weiss and the Ruth Realty Corporation. Though the contract is not set out in full, it seems a safe presumption that the corporation was the promising party. After the usual statement of the terms of sale, the contract closes with the following statement:

"Witness the signatures and seals of the above parties.


"Alex Weiss. "Ruth Realty Corp., "By Charles Baum. L.S." The plaintiff's complaint specifically alleged: "That prior to the execution of the said contract the defendant stated to the plaintiff's that he1 desired to enter into and execute the said contract and to take title to the said property in the name of Ruth Realty Corporation”.

On a motion to dismiss the complaint for failure to state a cause of action, the Appellate Division, two judges dissenting, affirmed the holding of the Special Term dismissing the complaint, and intimated further Kelly, P. J., refusing to concur on the point-that the plaintifi's remedy was an action for the breach of the defendant's implied warranty of authority. The court seemed to be unanimously; of the view that the plaintiff could recover for the fraud if he sustained his allegation, and this is undoubtedly sound.

Where the defendant without authority claims an existing individual or corporation as his principal and purports to act as agent, there is an increasing reluctance to follow the older authorities and hold him on the contract.2 This reluctance is based on a desire to

1Italics the writer's.

"Most of the older cases hold the agent on the contract, and some modern cases still adhere to that doctrine: Reeb v. Bronson, 196 Ill. App. 518 (1915); Terwilliger v. Murphy, 104 Ind. 32, 3 N. E. 404 (1885); Thilmany v. Iowa Paper Bag Co., 108 Iowa, 357, 79 N. W. 261 (1899); McCann v. Clark, 166 Iowa 705, 148 N. W. 1025 (1914); Richie v. Bass, 15 La. Ann. 668 (1860); Holland v. Stewart, 2 Mich. N. P. 39 (1870); Pratt v. Beaupre, 13 Minn. 187 (1868); Dusenberry v. Ellis, 3 Johns. Cases 70 (N. Y. 1802); Taft v. Brewster, 9 Johns. 334 (N. Y. 1812); White v. Skinner, 13 Johns. 307 (N. Y. 1816); Randall v. Van Vechten, 19 Johns. 60 (N. Y. 1819); Mott v. Hicks, I Cow. 513 (N. Y. 1823); Sinclair v. Jackson, 8 Cow. 543 (N. Y. 1826); Meech v. Smith, 7 Wend. 315 (N. Y. 1831); Rossiter v. Rossiter, 8 Wend. 494 (N. Y. 1832); Palmer v. Stephens, i Denio, 471 (N. Y. 1845); Kennedy v. Stonehouse, 13 N. D. 232, 100 N. W. 258 (1904); Stiteler v. Ditzenberger, 45 Pa. Super. Ct. 266 (1911); Clark v. Foster, 8 Vt. 98 (1836); Cobb v. Glenn Boom and Lumber Co., 57 W. Va. 49, 49 S. E. 1005 (1905). For a further collection of cases holding the agent liable


avoid the risk of doing violence to the actual intent of the plaintiff as well as of the defendant. The more recent cases have, therefore, given the plaintiff relief in the form of damages for the defendant's breach of an implied warranty of authority, or in deceit for the defendant's fraud. These remedies have also been held to be available to the plaintiff where the defendant, as the duly authorized agent of an existing principal, exceeds his authority. This tendency to refuse the remedy on the contract is not quite as strong where the defendant purports to act for a non-existent principal whose nonexistence is not known to the plaintiff, there being recent, wellconsidered cases definitely holding both ways. In these cases of non-existent principals however, there seems to be no reason for refusing to follow the modern decisions above referred to, where the agent acted without authority for an existing principal.R

The instant case does not fall into any of the above categories, since the plaintifl knew that the Ruth Realty Corporation was non-existent. The court nevertheless, moved apparently by the desire to hold out to the plaintiff some hope of recovery, intimated that the plaintiff's remedy would be an action for the breach of an implied warranty of

on the contract, see: 1 MECHEM, Agency (2d ed. 1914) § 1395; 2 CLARK & SKYLES, LAW OF AGENCY (1905) 1273; 42 A. L. R. 1310, citing cases in Ala., Ind., Iowa, Ky., Mass., Miss., Mo., N. H., S. C., Tenn., Tex., and W. Va. For cases refusing to hold the agent liable on the contract, see infra notes 3, 4, and 5. 'Sheffield v. Ladue, 16 Minn. 388 (1881); Fowle v. Kerchner, 87 N. C. 49 (1882); I MECHEM, loc. cit. supra note 2.

"Ogden v. Raymond, 22 Conn. 379 (1853); Chieppo v. Chieppo., 88 Conn. 233, 90 Atl. 940 (1914); Sheffield v. Ladue, supra note 3; Skaaraas v. Finnegan, 32 Minn. 107, 19 N. W. 729 (1884); Patterson v. Lippincott, 47 N. J. L. 457, I Atl. 506 (1885); White v. Madison, 26 N. Y. 117 (1862); Dung v. Parker, 52 N. Y. 494 (1873); Baltzen v. Nicolay, 53 N. Y. 467 (1873); Simmons v. Moore, 100 N. Y. 140, 2 N. E. 640 (1885); Taylor v. Nostrand, 134 N. Y. 108, 31 N. E. 246 (1892); Campbell v. Muller, 19 Misc. 189, 43 N. Y. Supp. 233 (Sup. Ct. 1897); Dailey Bros. v. Clements Co., 120 Misc. 310, 198 N. Y. Supp. 387 (Sup. Ct. 1923); Mickles v. Atl. Brokerage Co., 209 App. Div. 183, 204 N. Y. Supp. 571 (4th Dep't. 1924); Haupt v. Vint, 68 W. Va. 657, 70 S. E. 702 (1911); Yonge v. Toynbee, [1910] 1 K. B. (Eng.) 215. For a further collection of cases, see: I MECHEM, op. cit. supra note 3, §§ 1363, 1364, 1395, 1598; 34 L. R. A. (N. S.) 525; 2 C. J. 803-807; 42 A. L. R. 1312, citing cases in the U. S. Fed. Cts., Cal., Conn., Fla., Ga., Iowa, Me., Mass., Mo., Neb., N. Y., N. C., Ohio, Okla., Or., Tex., W. Va., Eng., Can.

'Chieppo v. Chieppo, supra note 4; Noyes v. Loring, 55 Me. 408 (1867); Haupt v. Vint, supra note 4. For further collection of authorities, see: 1 MECHEM, op. cit. supra note 2, §§ 1363, 1395, 1398; 2 C. J. 807.

"See supra notes 4 and 5.

"That the agent is liable on the contract: Alden v. Pegram, 16 Iowa, 163 (1864); Medlin v. Ebenezer Methodist Church, 132 S. C. 498, 129 S. E. 830 (1925), the latter holding that where the agent acts for a non-existent-principal, he should be liable on the contract regardless of the rule as to the liability of an agent on a contract made without or in excess of authority. For further collection of cases, see HUFFCUT, AGENCY (2nd ed.) 234.

That the agent is not liable on the contract, the remedy of the third party being for a breach of warranty: Chieppo v. Chieppo, supra note 4; Rowland v. Hall, 121 App. Div. 459, 106 N. Y. Supp. 55 (2d Dept. 1907); Trust Co. v. Floyd, 47 Ohio St. 525, 26 N. E. 110 (1890). See also I WILLISTON, CONTRACTS (1920) § 282; 1 MECHEM, op. cit. supra note 2, § 1383, the latter maintaining that the agent impliedly warrants the existence of his principal.

Chieppo v. Chieppo, supra note 4.

authority, apparently overlooking the fact that the plaintiff's confessed knowledge of defendant's lack of authority excludes any implied warranty thereof."

Among the decided cases in this general field of quasi-promoteragents, those which are most nearly in point as respects the instant case are those in which there is a written instrument purporting to be a contract of sale, to which the plaintiff has signed his name, and to which the defendant has signed both the name of a corporation known by both parties to be non-existent, and his own name beneath the corporate name in a manner designed to indicate that he is acting as agent for the corporation. Faced with such a situation, the courts have generally held the question of the liability of the agent to be a matter of determining the intent of the parties who actually signed the instrument,10 by looking not only at the instrument, but outside of it. While most courts do not expressly say that they look beyond the instrument for evidence as to intent, that there is no doubt that all of them do so, in cases where the question of intent involves the question as to who are the parties, is shown by the fact that they receive without question evidence as to the non-existence of the corporation purporting to be a party to the instrument."

If the third party and the alleged agent intended to form any valid legal contract at all, the agent is held liable on the contract.12 This proceeds on the theory that the parties are presumed to know the law. They are presumed to know that the non-existent principal can not be bound, and since they intended to form a binding contract, they are presumed to have intended to bind each other. If the parties did not intend to form a valid contract, there is no further question of the liability of the agent.13 The writing is merely a continuing offer which may be accepted by the corporation when it comes into existence.14 The point of cleavage in the decisions of the various courts arises in determining what intent is shown by a given state of fact. The majority declare that in the absence of other evidence beyond the non-existence Yof the corporation, it is presumed that the parties intended to form a valid contract with each other. Others agree with the instant

'Chieppo v. Chieppo, supra note 4; McQuiddy Printing Co. v. Head, 7 Ala. App. 384, 62 So. 287 (1913); Hersey v. Tully, 8 Colo. App., 110, 44 Pac. 854 (1896); Sinclair v. Jackson, supra note 2; Hall v. Lauderdale, 46 N. Y. 70 (1871); Mickles v. Atl. Brokerage Co., supra note 4. For further authorities, see: I MECHEM, op. cit. supra note 2, §§ 1369, 1383; Story, Agency (9th ed. 1882) § 265. 10McQuiddy Printing Co. v. Head, supra note 9; Queen City Furn. Co. v. Crawford, 127 Mo. 356, 30 S. W. 163 (1895); Davis v. Joerke, 47 N. D. 39, 181 N. W. 68 (1920); O'Rorke v. Geary, 207 Pa. 240, 56 Atl. 541 (1903); For further authorities, see I WILLISTON, Contracts (1920) p. 538.

"Kelner v. Baxter, L. R. 2 C. P. 174 (Eng. 1868); McQuiddy Co. v. Head, supra note 9.

i2Abbott v. Hapgood, 150 Mass. 248, 22 N. E. 907 (1889); Thilmany v. Iowa Paper Bag Co., supra note 2, applying the rule where the agent acts without authority for an existent principal; I WILLISTON, op. cit. supra, note 10, § 282. 18McQuiddy Co. v. Head, supra note 9; I WILLISTON, op. cit. supra note 10. 14See note 13.

15 Meinhard Co. v. Bedingfield Co., 4 Ga. App. 176, 61 S. E. 34 (1908); Wells v. Fay & Egan, 143 Ga. 732, 85 S. E. 873 (1915); Hilgemeir v. Bower M'f'g. Co., 81 Ind. App. 191, 139 N. E. 691 (1923); O'Rorke v. Geary, supra note 10; Strause

case, and maintain that where one signs as agent for an admittedly non-existent corporation, it is presumed that the intention of the parties is that the agent is not to be personally bound in the absence of apt words in the contract to bind him.16 The latter cases seem to have for their support the very logical argument that the parties, knowing the situation, can bind each other if they so desire. If they can bind each other and do not do so by express words, the presumption is that they do not desire to be bound. The problem, therefore, is to find whether the intent of the parties was that there should be an immediate contract between them, particularly in cases where the appropriate method of signing to avoid liability, as in the instant case, is employed.

Where the custody of chattels or the use of land has been given to the defendant, except under unusual circumstances, 17 the defendant is held to be bound under both the above theories, 18 though the steps by which the result is arrived at necessarily differ. In considering this point, it should be noted that it can not be said, without begging the question, that title to the goods so given into the custody of the defendant passes, as title can not pass without the existence of a contract, and the turning over of the goods is to be used as evidence of an intent to contract. The courts which, in the absence of evidence outside the contract beyond the non-existence of the corporate party, hold the defendant on the contract need only treat evidence of the giving of the custody of chattels or of the use of land as cumulative; while the courts which, in the absence of such other evidence, hold that the defendant is not bound on the contract justifiably find in such a transaction the basis for holding the defendant on the contract.19 The plaintiff certainly would not ordinarily have given this custody of chattels or use of land had he not thought that the de

v. Richmond Woodworking Co., 109 Va. 724, 65 S. E. 659 (1909); Bell v. Francis, C. & P. 66 (Eng. 1839). See also 2 CLARK & SKYLES, op. cit. supra note 2, § 572; I FLETCher, Cyclopedia of Corp. (1917) § 158.

16McQuiddy Printing Co. v. Head, supra note 9, seems to support this contention by implication. It is rare that the court states which theory it is upholding, the theory having to be construed by implication. Belding v. Vaughan, 108 Ark. 69, 157 S. W. 400 (1913), may also be construed in this manner.

In Strause v. Richmond Woodworking Co., supra note 15, these special circumstances were: Delivery to the corporation after it became organized, charging the corporation on the books of the Co., and not sending a bill to the defendant in person. In McQuiddy Printing Co. v. Head, supra note 9, the court found that both parties were so confident of the success of the corporation that the plaintiff supplied the goods on the credit of the prospective corporation. See also Belding v. Vaughan, supra note 16; 7 R. C. L. 85, and the cases there cited.

18It seems generally recognized that the delivery of goods under such a contract binds the agent. Brisacher v. Baier, 67 Cal. App. 96, 226 Pac. 830 (1924); Bradshaw v. Jones, 152 S. W. 695 (Tex. 1913); Kerridge v. Hesse, 9 C. & P. 200, (Eng. 1839). The cases do not generally make the distinction, but the instant case correctly points out that most of the cases holding an agent for an admittedly non-existent principal liable on the contract are cases where goods have been delivered.

19Meinhard Schaul & Co. v. Bedingfield Co., supra note 15. Both parties knew that there could be no corporate liability when the goods were delivered, so they must have intended to bind each other.

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