Number and powers of directors. Dividends. Arbitration The number of directors must be the prescribed number. No person is capable of being a director unless he be a shareholder; and no person holding an office or place of trust or profit under the company or interested in any contract with the company is capable of being a director. The directors have the management and exercise of all the powers of the company. The manner in which such powers may be exercised is as follows:Any contract which, if made between private persons, would by law be required to be in writing and under seal, must also be entered into, if on behalf of the company, in writing and under seal. Any contract which, if made between private parties, would be by law required to be in writing and signed by the parties to be charged therewith, the same must also be entered into by the directors in writing, signed by any two of them. And any contract which, if made between private persons, would by law be valid, although made by parol only, and not reduced into writing, may also be made by the directors by parol only. No director, by being party to or executing in the capacity of director any contract or instrument on behalf of the company, or executing any of the powers given to the directors, acquires any personal liability on the same (a). Auditors must be appointed, and proper accounts kept of all matters. Previously to the declaration of dividends a scheme should be prepared showing the profits, if any, of the company, but no dividend can be made whereby the capital stock will be in any degree reduced. The company may from time to time make bye-laws (b). When any dispute arises which must be settled by arbitration, each party must nominate and appoint an arbitrator, and if one of the parties fails to appoint an arbitrator, the other party may appoint his arbitrator to act for both parties, and when more than one arbitrator has been appointed, they may nominate and appoint an umpire to decide on any matters on which they may differ (c). In all cases where damages, costs, or expenses are directed to be paid, and the method of enforcing the same is not provided for, such amount is to be ascertained and determined by two justices; and if no sufficient goods can be found to levy such damages, the same may be levied by (a) 8 Vict. c. 16, ss. 81 to 100. (b) 8 Vict. c. 16, ss. 101 to 127. (c) 8 Vict. c. 16, ss. 128 to 134. distress of the goods of the treasurer of the company. Other clauses refer to penalties, appeal, &c. lands. The Act for consolidating in one Act certain provisions usually Power to take inserted in Acts authorising the taking of lands for undertakings of a public nature (a), provides, first, for the purchase of land by agreement, and otherwise than by agreement. In the latter case the whole capital must be subscribed before compulsory powers of purchase can be put in force. In case of disputes as to compensation, where the amount claimed does not exceed 501., it must be settled by two justices. Where it exceeds 50l., it must be settled by arbitration or jury, at the option of the party claiming compensation (b). The other clauses of the Act apply to conveyances, entry on lands, copyhold, common lands, &c. (a) 8 Vict. c. 18. (b) 8 Vict. e. 18, ss. 16 to 23. CHAPTER VI. Agency how constituted. May be special or general, limited. PRINCIPAL AND AGENT. SECTION I. CREATION OF AGENCY. BRITISH LAW. THE relationship of principal and agent is constituted whenever one person, having power to do any act, authorises another person to do it for him in his name. The person employing is called the principal or employer; the person employed is called the agent or attorney; the relation between the parties is one of agency; and the power thus delegated is the authority. When the agency is created by a formal instrument or by deed under seal, it is called a letter of attorney. The agency may be special or general. A special agency exists when a person authorises another to do a single act; a general agency exists where the party is empowered to do all acts connected with a particular business or employment. The limited or un- authority may be limited or unlimited. It is limited when accompanied by instructions as to the course to pursue. It is unlimited when such course is left to the agent's own discretion. The authority may be created by deed, by writing, or by verbal instructions (a). It may also be inferred from the conduct or relation of the parties; and it may be either antecedently given or subsequently adopted by an act of recognition or by acquiescence (b). An authority to execute a deed on behalf of his principal must, however, be by deed (e). Authority by deed or by parol. Every person may be principal or agent. Every person capable of contracting, and not personally disqualified by law, may be a principal. Infants, married women, idiots, lunatics, and other persons having no capacity to contract (a) Coles v. Trecothick, 9 Ves. jun. 250 (b) Maclean v. Dunn, 4 Bing. 722; Jones v. Bright, 5 Bing. 533. (c) Harrison v. Jackson, 7 T. R. 209; Coomb's case, 9 Coke R. 766; Horsley v. Rush, 7 T. R. 207. are incapable of appointing an agent. Nevertheless an infant may authorise another to do any act for his own benefit, and a married woman may delegate to another powers with respect to her private property (a). not be trans The authority of the agent is personal to himself. A person Authority canauthorised to do an act for another requiring the exercise of ferred, discretion and judgment must execute it himself, and cannot transfer the authority to another. The trust and confidence are reposed on him, and he cannot assign them to a stranger unknown to the principal. To enable an agent to delegate his unless authorauthority to another a special power must be given him, except where such power is indispensable for the right performance of the act, or where it is implied by the usage of trade (b). When a husband permits his wife to act for him in any department of business, her admissions or acknowledgments are evidence to charge the husband. ised by usage. FOREIGN LAWS. be refused. France.-Agency is a contract by which a person gives power Agency may to another to do something for himself. The contract is completed by the acceptance of the authority. The party to whom such agency is offered may refuse it, but in that case he should notify his refusal as soon as possible. If he keep silence, it will be understood that he has accepted it. But even in case of refusal he must have some regard to the interest of his principal. Thus, when goods are sent for sale, if the party refuses to receive them he cannot leave such goods uncared for; but, whilst making due protest, he must take care of them till they are taken from his hands. The agent who has undertaken to execute an order cannot renounce it unless the principal himself fails to fulfil his obligation in not sending the necessary funds or becomes bankrupt. The authority may be by deed, by letter, and also by parol. The acceptance may be proved by silence or implied by the agent fulfilling his instructions. The authority may be general or special (c). (a) Keane v. Boycott, 2 H. Bl. 515. (b) Solly v. Rathbone, 2 M. & S. 298. In Cahill v. Dawson, 26 L. J. C. P. 253, doubts were expressed as to whether an agent instructed by another agent to procure an insurance could (c) French Civil Code, §§ 1984 to 1990. Once under taken cannot be renounced. Contract of agency express or implied. When the authority is implied. Ratification express or tacit. United States.-Agency is founded upon a contract either express or implied, by which one of the parties confides to the other the management of some business to be transacted in his name or on his account, and by which the other assumes to do the business and to render an account of it. The authority of the agent may be created by deed or writing, or verbally without writing. The agency may be inferred from the relation of the parties, and the nature of the employment, without proof of any express appointment. It is sufficient that there be satisfactory evidence of the fact that the principal employed the agent, and the agent undertook the trust. The extent of the authority of an agent will sometimes be extended or varied on the ground of implied authority, according to the pressure of circumstances connected with the business with which he is entrusted. If an agent is to convey real estate or any interest in land, the appointment must be in writing. The agency must be antecedently given or be subsequently adopted, and in the latter case there must be some act of recognition, but an acquiescence in the assumed agency of another when the acts of the agent are brought to the knowledge of his principal is equivalent to an express authority. By permitting another to hold himself out to the world as his agent, the principal adopts his acts, and will be held bound to the person who gives credit thereafter to the other in the capacity of his agent. So when a broker had usually signed policies of insurance for another person, or an agent was in the habit of drawing bills for another, the authority was implied from the fact that the principal had assumed and ratified his acts, and he was bound by a repetition of such acts where there was no proof of any revocation of the power or of collusion between a third party and the agent. Even silence, under certain circumstances, is equivalent to an approval. When the principal is informed of what has been done, he must dissent, and give notice of it in a reasonable time, and if he does not, his assent and ratification will be presumed (a). Holland. The Dutch Code prescribes the same laws as the French (b). Prussia.-An agency may be given verbally, unless in special cases the law prescribes that it must be by deed. Public agents (a) Kent's Commentaries, vol. ii., p. 797. |