Steele v. Oswego Cotton Manufacturing Co. — 15 Wend. 265

Majority

p. 265

Steele vs. The Oswego Cotton Manufacturing Company.

Headnote

Jissumpsit will not lie upon a note of a corporation, to which the corporate seal is affixed; and if a count upon such note be joined with the money" counts in assumpsit, the judgment will be arrested.

Motion in arrest. The plaintiff declared in assumpsit. The first count stated that on, &e. at, &c. the defendants made their certain note in writing, the corporate seal of the defendants being thereto affixed, whereby they promised to pay to the plaintiff, four months after date, a certain quantity of sheetings, to be delivered at their warehouse, for value received ; and then follows the common conclusion, that the defendants did not deliver the sheeting, although often requested. The second and third counts were like the first on similar instruments, and then followed the common money counts. The plaintiff obtained a verdict, and the defendants now moved in arrest of judgment.

p. 266

S. Stevens, for the defendants,

insisted that the instruments declared on in the three first counts were covenants,aná the counts were substantially in covenant, which he contend-e<^ cou^ not be joined with the remaining counts, which are in assumpsit.

J. A. Spencer, for the plaintiff,

insisted that the instruments declared on were not necessarily covenants. There is no case which decides that the note of a corporation, expressed by its seal, is a deed. A corporation may give a note, or bind itself by a parol contract, and the seal is in such case only evidence of the assent of the corporation; it does not create it a specialty. Whether it shall be intended a deed or a parol promise, depends upon the nature of the instrument. Here it is a mere promise for the delivery of manufactured articles.

By the Court,

The first three counts are special, and are in assumpsit on a sealed instrument; the residue are the common indebitatus counts. This is probably the first time this form of action has been brought and attempted to be sustained upon such an instrument. It was said by the counsel that he could find no case adjudging that an instrument executed under the seal of a corporation is, in technical language, a deed. This might well be ; for I presume the position was never doubted. It was for a long time doubted by courts whether a corporation could do any lawful act except by their seal—or by deed, which is the same thing ;• and of consequence, as they could make no promise or simple contract, assumpsit would not lie against them at all. Angel & Ames on Corp. 109,110, 117, 126,218, 219. Chitty’s Pl. 98. 7 Cranch, 297 . 12 Johns. R. 227. 14 id. 118. 19 id. 60. 2 Kent’s Com. 288, 292. This ancient doctrine has been exploded in this country, as will be seen by the above cases; though in England it is still maintained, with few exceptions. Waterworks Co. v. Bailey et. al., 4 Bing.283. We have before had occasion to remark, that the legal effect of the use of a seal by a corporation does not differ from that of an individual : the one is the seal of an artificial, the other of a nat

p. 267

Krai person. The Farmer’s Woollen Manufacturing Company v. Clark, ante, p. 256. See also 6 Johns. R. 85.

A motion in arrest of judgment is a proper mode for the defendant to avail himself of this error, it appearing upon the record. Cro. Eliz. 859. Cro.Jac. 598. Cro.Eliz. 786. Cro. Ch. 56.

Judgment arrested