2. In tort. In an early Ohio case it was held that a corporation could not be liable for an assault and battery committed by its agents on its behalf: Orr v. Bank, 1 O. 36.

A corporation is now liable for the torts of its agents to the same extent as a natural person is liable: Railway v. Young, 21 O. S. 518.

A corporation is liable for negligence of its agents and officers to the extent that a natural person would be liable under similar circumstances: Railroad Co. v. Keary, 3 O. S. 201; see also, as to the liability of public corporations: Goodloe v. Cincinnati, 4 O. 500; Smith v. Cincinnati, 4 O. 514.

A corporation is not liable for the wrongful acts of its agent in a matter which is outside the scope of his employment: Railway v. Wetmore, 19 O. S. 110.

A corporation is liable however, for the acts of its agents within the scope of his employment, even if his action is willful and malicious: Business College v. Lloyd, 60 O. S. 448.

If a passenger is wrongfully expelled from a car, it is said that the corporation is liable for the malicious acts of the agent in such expulsion, but not his acts subsequent thereto : Graybill v. Traction Co.. 4 O. L. R. 524, 51 Bull. 428.

A corporation is liable for the wrongful acts of its agents, even if it may be subjected to exemplary damages by reason of their willful or oppressive conduct: Telegraph Co. v. Smith, 64 O. S. 106.

A corporation is liable for the negligence of its agents to the same extent that a natural person is liable: Railway v. Keary, 3 O. S. 201.

A corporation organized for the purpose of public charity is not liable for the negligence of its employes or servants, if it has exercised proper care in their selection: Conner v. Sisters of Poor, 7 O. N. P. 514, 10 O. D. (N. P.) 86; Johnson v. Lawrence Hospital, 12 O. D. (N. P.) 795.

B. Personal liability of agent or member. Members, stockholders, agents and employes who make use of the corporate firm for defrauding or injuring other persons are personally liable for such wrong: Bartholomew v. Bentley, 1 O. S. 37; Kearny v. Buttles, 1 O. S. 362; Medill v. Collier, 16 O. S. 599.

A written instrument signed by the agent of a corporation in such a manner as to import personal liability on his part renders him liable personally, although by oral agreement the agent was not to be liable: Titus v. Kyle, 10 O. S. 444; Robison v. Bank, 44 O. S. 441.

Liability is founded upon the implied promise of the person so contracting as agent that he has authority to bind the principal, and the measure of damages is the loss sustained by the other contracting party by reason of his not having the valid contract which the agent assumed to make: Trust Co. v. Floyd, 47 O. S. 525.

XII. CONVEYANCES BY CORPORATION.

A conveyance which purports to be executed by the president of a corporation and is signed by him personally and sealed by his seal is not valid as the conveyance of the corporation: Hatch v. Barr, 1 O. 390.

The execution of deeds by a corporation is not regulated by statute in Ohio: Sheehan v. Davis, 17 O. S. 571; Norris v. Dains, 52 O. S. 215.

A petition which alleged that certain notes and a mortgage were executed by the corporation was held to be sufficient, although the mortgage concluded "In witness whereof, said company have caused their corporate seal to be attached and signed by their president and attested by their secretary," followed by the official signatures of such officers and the seal of the corporation: Hays v. Gas Light & Coal Co., 29 O. S. 330.

If a deed is executed in proper form by the president of the corporation and sealed with the seal of the corporation, his

authority from the board of directors will be presumed, and the fact that the minutes do not show a specific grant of authority is not sufficient to show that he was not authorized to execute such deed: Railroad v. Harter, 26 O. S. 426.

On account of the general rule as to the signature by the cashier of a bank, a deed given by a bank, which is signed by the cashier in his own name, to which the seal of the corporation is affixed, and which is acknowledged by such cashier, is properly executed: Sheehan v. Davis, 17 O. S. 571.

An assignment of a lease by a corporation which recites in its granting clause that such assignment is made by A, its treasurer, and which is signed "A, Treasurer," and is sealed with the seal of the corporation, is not sufficient to pass the title of such corporation in such lease: Norris v. Dains, 52 O. S. 215.

A mortgage given by a corporation, which by mistake was signed by the stockholders personally, is good at least in equity: Bundy v. Iron Co., 38 O. S. 300.

For the form of executing conveyances on behalf of a railway company, see G. C. 8761.

If the execution of a deed by a corporation is in issue, the signature by the president and the seal of the corporation do not prove themselves, and the deed cannot be admitted in evidence unless execution is proved: Walsh v. Barton, 24 O. S. 28.

XIII. PARTIES TO ACTIONS.

A. Stockholders. In case of breach of trust on the part of the directors or trustees of the corporation, a stockholder may maintain an action on behalf of himself and the other stockholders: Wiswell v. Church, 14 O. S. 31; Henry v. Railway, 2 O. N. P. 118, 5 O. D. (N. P.) 41.

Such right of action exists only if the irregularity or wrongful acts complained of are injurious to the corporation or to its stockholders: Larwill v. Burke, 19 O. C. C. 513, 10 O. C. D. 605.

While the unlawful conduct of the directors may be enjoined, a court of equity will not take charge of the affairs of a corporation in the absence of specific statutory authority: Railway v. Duckworth, 2 O. C. C. 518, 1 O. C. D. 618.

A stockholder may bring an action in equity to prevent the directors of a corporation from misappropriating the capital thereof in violation of their trust and duty: Dodge v. Woolsey, 59 U. S. (18 How.) 331, 3 O. F. D. 300.

B. Creditors. If the capital of a corporation has been disposed of wrongfully so as to leave the creditors unpaid, the creditors may maintain an action to have such transfer set aside: Goodin v. Canal Co., 18 O. S. 169.

Where, pursuant to an agreement among themselves, partners capitalize the partnership property at a valuation greatly in excess of its true value; create a corporation under the laws of this state to continue the former partnership business, fixing its capital stock at a sum equal to the inflated value placed on the partnership property; elect themselves managing officers of the concern; transfer this property at such inflated value, to the corporation in exchange for its entire capital stock which they cause to be issued, as fully paid up, to each partner, or as he directed, in proportion to his interest in the partnership; and the corporation, continuing the business, afterwards becomes insolvent, the transaction will be regarded as a fraud upon the corporate creditors, although none was intended or contemplated by the parties to such transaction. In such case each partner will be regarded as an original subscriber for so much of the stock as was thus issued to him, and credited on his subscription for the actual value only of his interest in the partnership property transferred to the corporation in payment of such subscription. The balance left, upon applying this credit, will be deemed a debt due from him to the corporation, and therefore corporate assets: Gates v. Stone Co., 57 O. S. 60 (affirming Gates v. Stone Co., 9 O. C. C. 99, 6 O. C. D. 23).

XIV. PLEADING AND EVIDENCE.

A general denial does not raise the issue of a corporate
capacity, whether the petition contains an averment of corporate
capacity: Brady v. Supply Co., 64 O. S. 267; or whether such
averment is lacking: Manufacturing Co. v. Electric Co., 8 O. C.
C. 311, 4 O. C. D. 555 (affirmed in Electric Co. v. Manufacturing
Co., 54 O. S. 659).

Where a corporation whose name is composed of several
words is sued by a name in which a word in the corporate name
is omitted, such omission or misnomer, unless pleaded in abate-
ment, will be disregarded by the court:
phone Co., 36 O. S. 296.
State, ex rel., v. Tele-

In an action against a corporation which is based upon the corporate charter and franchise, the existence of such corporation and the nature of the franchise must be pleaded: Brady v. Supply Co., 64 O. S. 267 (approving and following Devoss v. Gray, 22 O. S. 159); see, also, Streit v. Brewing Co., 12 O. D. (N. P.) 619.

If the corporate existence of the plaintiff is properly denied,
it must establish such existence by evidence:
Co. v. Dodds, 11 Dec. Rep. 759, 29 Bull. 61.
Gas Light & Coke

Under an answer nul tiel corporation, a certificate of incorporation is not admissible unless all the conditions precedent to form the corporation are shown to have been complied with: Navigation Co. v. Eagle, 20 O. S. 238. (In this case a corporation was formed under a law authorizing the formation of corporations "to improve any stream heretofore declared navigable," and it was not shown that the stream for the improvement of which the corporation was formed was declared navigable).

Under an indictment for burglary which consisted of breaking into the office of a railway company, the omission of an averment that such railway was incorporated is not ground for a motion to quash: Hamilton v. State, 34 O. S. 82.

The same result was reached under an indictment for burglary consisting of breaking into a car of a railway company: Burke v. State, 34 O. S. 79.

The verification by an officer of a corporation is not admissible as evidence of its corporate capacity: Packet Co. v. Fogarty, 9 O. C. C. 418, 6 O. C. D. 375.

XV. FOREIGN CORPORATIONS.

A corporation which is organized under the laws of another state and which is authorized by such state to transact business in Ohio, may transact business here and may sue and be sued in our courts, unless in some way restrained by Ohio legislation: Newbury Petroleum Co. v. Weare, 27 O. S. 343.

A general statute of another state which restricts the powers of testators to devise realty to corporations, does not prevent a corporation formed in such state from taking realty in. Ohio by devise: Bible Society v. Marshall, 15 O. S. 537.

There is no rule of comity whereby a foreign corporation can engage in business which it would not be permitted to engage in in the state wherein it was created under its articles of incorporation: Cattle Co. v. McGillin, 21 O. C. C. 210, 11 O. C. D. 413; Cattle Co. v. McGillin, 7 O. N. P. 575, 10 O. D. (N. P.) 146.

Same or

289

SECTION 8628. The secrtary of state shall not file or record any articles of incorporation wherein the corporate similar names. name is likely to mislead the public as to the nature or purpose of the business its charter authorizes, nor if such name. is that of an existing corporation, or so similar thereto as to be likely to mislead the public, unless the written consent of the existing corporation signed by its president and secretary, be filed with such articles. (R. S. Sec. 3238.)

19

B. OF P. S.

Certified copy evidence of incorporation.

Subscription books.

Upon the dissolution of a trading copartnership, its assets, including the good will of the business, may be sold as a whole, either by the partners directly, or through a receiver under an order of court in a case in which they are parties; and a purchaser thereof, under either method of sale, is entitled to continue the business as the successor of the firm, and make use of the firm name for that purpose. Where the purchaser transfers the property so acquired by him to a corporation of which he is a member, organized to succeed to the business, it may carry on the business in the same manner, under a corporate name, including the name which had been used by the firm: Manufacturing Co. v. Snyder, 54 O. S. 86.

SECTION 8629. A copy of articles of incorporation so filed, and duly certified by the secretary of state, shall be prima facie evidence of the existence of the corporation therein named. (R. S. Sec. 3238.)

See State v. Robinson, 9 Dec. Rep. 383, 12 Bull. 269.

SECTION 8630. The persons named in the articles of incorporation of a corporation for profit, or a majority of them, shall order books to be opened for subscriptions to the captital stock of the corporation at such time or times and place or places as they deem expedient. (R. S. Sec. 3242.)

In the absence of statutory authority, a corporation cannot subscribe to the stock of another corporation: Railway Co. v. Iron Co., 46 O. S. 44.

For the effect of the subscription of a married woman at a time when she could not bind herself personally, but could bind her separate estate, see Rice v. Railroad, 32 O. S. 380.

For the power of a municipal corporation or a public quasi corporation to become a stockholder in a corporation, see Art. VIII, 6, of the Ohio constitution and the cases thereunder.

II. OFFER AND ACCEPTANCE.

An offer to subscribe to the stock of a corporation is not operative until it is accepted, and the death of the subscriber before such acceptance causes such offer to lapse: Wallace v. Townsend, 43 O. S. 537.

If a subscription to stock is made as a part of a contract, the consideration for which is an agreement to sell realty belonging to the corporation at a specified price, such contract is not binding upon the corporation if the officer was not authorized to sell such land, but the corporation, cannot repudiate the coven

ant to sell the land and enforce the subscription, the contract being entire: Weeden v. Railroad, 14 O. 563.

III. MISREPRESENTATION AND FRAUD.

One who has been induced to become a stockholder by fraudulent statements on the part of the promoters may rescind, if they act promptly and if the rights of other stockholders or creditors will not be affected injuriously by such rescission: Bank v. Fence Post Co., 3 O. C. C. (N. S.) 372, 13 O. C. D. 274.

A subscriber is not liable if the name of the corporation is not stated correctly and truthfully in a contract of subscription: Biggio v. Sandheger, 8 O. N. P. 13, 10 O. D. (N. P.) 316.

As against a creditor who is seeking to enforce the stock liability, the stockholder cannot introduce the fraud of a person who secured a subscription which consisted in representing that one hundred thousand dollars had already been raised: Ryan v. Railway, 6 Dec. Rep. 1070, 10 Am L. Rec. 263.

If the subscriber waits an unreasonable period of time (in this case three years), and in the meantime the corporation has become insolvent, he cannot set up fraud as a defence to an action upon subscription: Bank v. Varnish Co., 8 O. C. C. 563, 4 O. C. D. 511.

A subscription cannot be avoided on the ground of fraud if the representations which were made dealt with the future only and were promises or expressions of opinion: Armstrong v. Karshner, 47 O. S. 276.

See, also, upon the nature of fraud, Freeman v. Muth, 7 Dec. Rep. 555, 3 Bull. 914.

One who purchases stock in an Ohio corporation on the open market for about twenty-five per cent. of its face value, without inquiry as to the assets of the company, or the representations made upon the face of its certificates of stock, can not, upon the subsequent insolvency of the company, recover the amount paid for said stock from the president of the company in an action for deceit, upon an alleged misrepresentation made by him when he signed certificates of stock, certifying that they were "fully paid and non-assessable," notwithstanding said president knew that upon the original issue of said stock property greatly overvalued had been received by the company in payment for it: Nutt v. Wheeler, 10 O. C. C. (N. S.) 217, 20 O. C. D. 86.

IV. CONSIDERATION.

A subscriber may introduce as a defence to an action upon a subscription to corporate stock, the fact that no such corporation as that for the stock of which he subscribed ever existed: Navigation Co. v. Eagle, 29 O. S. 238.

See, also, VII, this section.

V. AMOUNT TO BE SUBSCRIBED.

In the absence of specific statutory provision, it is not necessary that all the stock of the corporation be subscribed before such corporation can engage in business: Bank v. Hall, 35 O. S. 158.

In the absence of specific statutory provision to the contrary, the subscription price for the stock actually subscribed may be collected, although the entire amount of the capital stock named in the articles of incorporation has not been subscribed: Jewett v. Railway, 34 O. S. 601; see, to the same general effect, Chamberlain v. Railroad, 15 O. S. 225; Railroad v. Smith, 15 O. S. 328.

This is true, especially if, by the contract of subscription, a certain amount is to be subscribed before the subscription is to be collected, which amount is less than the amount of the capital stock named in the articles of incorporation: Emmet v. Railway, 31 O. S. 23.