99.66 thereto... These are clauses that should never be omitted where the contract is executed by parties other than those on whose behalf it is made. It is a clause that will protect the engineer, agent, or board, and will afford the contractor information by which he can learn the duties, powers and resources with which the parties propose to act. This is imperative with the contractor, for if the contract is executed by an engineer, officer, or board who has not the requisite authority, the contract is void, and the contractor finds he has done work unauthorized by the principal and for which he may not recover. 30. Principal should be Made the Party If Agent Assumes the Obligation He will be Liable. The principal or proprietor should be made the party to the contract, and his [its] name be signed at the end. If the contract is executed by or through an engineer, officer, or agent, the intention must be perfectly plain. The proper form for such a contract is the one given above, although other forms may be binding and the engineer or agent escape liability. Thus in an agreement in the form "Memoranda of agreement between C. [the contractor] and F. [the engineer] on the part of A [the company], the said E. hereby agrees... ..signed E," E. was held liable.' In another case, the contract read: "On behalf of B. we hereby consent...... ..money to be paid to A. and E.; E. to supervise certain work. [Signed, A. and E.]" A. and E. were held liable because A. and E. were to receive payment. This case has been criticised by good authority, but it nevertheless stands on record. .... In a contract of sale where E. as agent for A. agrees........[signed] E., E. was held personally liable on the contract." The tendency seems to be to get away from these precedents, and to interpret the contract, according to the intention of the parties, but they are established decisions and may be followed." A mere description in the body of an instrument of a person as agent, without words or necessary implications showing that he signs as agent only, will not exempt him from liability on the contract. So it was held that a contract for the sale of wheat in the following form: "Sold C. 200 quarters. wheat [as agents for, etc.], and signed E.," made E. liable upon the contract." An engineer or agent who uses his own name instead of that of his principal (company) when he intends to bind the latter, renders himself liable. The word "engineer or agent" appended to his name is universally 1 Norton v. Herron, Ryan & Moody 229. 2 Tanner v. Christian, 4 E. & B 590. Paice. Walker. L. R 5 Exch. 173; Stone v. Wood, 7 Cowen 453. 757. Deering v. Thorn (Minn.), 13 Rep. Haskell v. Cornish, 13 Cal. 47; Quigley v. De Hass, 82 Pa. St. 267; see also Hutchison v. Eaton, 13 Q B. D. 861. 6 Paice v. Walker, L R. 5 Exch. 178 [1870]; and see Fairlee v. Fenton, L. R. 5 Exch. 169. held a mere description of the person. It is held to afford no relief from personal liability, but amounts to no more than if he affixed the abbreviations of his collegiate degrees, as C. E., M.E., or B. Arch.' If, on a note, the name of the corporation be signed followed by the name of an individual with "Prest." after it, though without the word "per" between the names, it is the promisory note of the corporation and not a joint note.' If the president had signed his own name and written "Prest. " after the signature, it would not have relieved him from personal liability. If he does not disclose the name of his company he is personally liable, and parol evidence is not admissible to show that a written instrument was made on behalf of another unless there be something on the face of the instrument to indicate it.' 31. Proof of Agency.-Some proof it seems may be offered that it was the intention of the agent to bind his company and not himself. Evidence may be given that it was known to the one party that the other party was an agent, and evidence may be admitted on the other hand to show that in this particular case he was acting as a principal, having agreed to pay for the work done out of his own money. A distinction has been made between contracts with public agents and officers who act on behalf of their governments and those made by agents of a private corporation or a person. If a public officer fails to bind his government and no action can be had against it, yet the officer is not personally liable, the public faith being the only security. In the case of a private corporation, the law requires the agent to see that his employer or principal is legally bound by his act, or it holds him personally responsible.' Agency cannot be proved by the declaration of one assuming to act in that capacity nor by declarations of one claiming to act as agent. The extent of his authority cannot be shown by proving his declarations though accompanied by acts, unless such declarations or acts were brought home to the principal. Evidence that there was a general understanding 'Hough o. Manzanos, 4 Exch. Div. 104; Saver. Nichols, 5 Cal. 487; see Hill v. Miller, 76 N. Y. 32 [1879]; Haskell v. Cornish, 13 Cal. 47 [1859] Sharp . Smith, 32 Ill. App. 336, Directors Paige v. Walker, L. R. 5 Exch. 173 [1870]; Fullam . West Brookfield, 9 Allen (Mass.) 1, Committee" Sperry v. Farming, 80 Ill. 371 [1875]. Trustee"; Pershing v. Industrial Co. (Minn.), 59 N. W. Rp. 1084; see 29 Amer. & Eng. Ency. Law 863, note. 853. 46 Reeve . Bank (N. J.), 23 Alt. Rep. Heffner. Brownell, 31 N. W. Rep. 947 [1887]. See collection of cases and references in 8 N. E Rep. 586, note, and also Mid Co. Bk. v. Hirsh Bros., 4 N. Y Supp. 385 [1889]. 5 Deering v. Thorn (Minn.) 13 Rep. 757 [1882]; and see also 13 Minn. 106, 187; 14 Minn. 214 Hewes v. Andrews (Colo.), 20 Pac Rep. 338 [1889]. Randall v. Van Vechten, 19 Johns. (N. Y.) 60. 8 Brady v. Nagle (Tex. Civ. App.). 29 S. W. 943; Burke v. Frye (Neb ). 62 N. W. Rep. 476; Fullerton McLaughlin (Sup), 24 N. Y. Supp. 280; Dowden v. Cryder (N. J.), 26 Atl. Rep. 941. Richardson Co. v. School Dist. (Neb.), 64 N. W. Rep. 218. among business men that an agency existed has been held admissible,' and the agency may be proven by letters and telegrams from the principal." 32. Names of Parties in Body of Contract should Correspond with Signatures. The names of the parties in the introduction should correspond strictly with the signatures and seals at the end of the contract, for a variance may be fatal to the contract. A contract made in the name of a railroad corporation for grading its roadbed was signed by its engineer, who used his own private seal, subscribing to his signature and seal "Chief Engineer of T., etc., R. Co., and as such its authorized agent to make this agreement." And the court held it was not the corporation's sealed contract; but as the engineer had authority to make a simple contract, that the seal should be disregarded and the contract held a simple contract. This has not been the universal interpretation of such contracts, and unless it can be shown that a simple contract was entered into preliminary to the sealed instrument, it is submitted that the contract would fail. It is difficult to impose upon the parties a contract which they never contemplated or intended, but if they have undertaken to merge an existing simple contract into a specialty and have failed, then the simple contract remains and the written document is evidence of the terms of that contract. It is very unsafe to draw contracts in such a form; the party who covenants should be the party to sign and seal. If the covenantor does not sign and seal, then he is not liable because it is not his seal; and the party who has signed and sealed is not liable, for it is not his covenant. It is important to distinguish between simple contracts and contracts under seal in determining whether the engineer [agent] or principal is liable. In simple contracts the intention of the parties should prevail; in contracts under seal the question is, who signed and sealed the specialty and who made the covenant. Therefore a deed made in the name of a corporation authorized by law to have a common seal, signed by the president and secretary of the corporation, but without authority from the board of trustees and not sealed with the corporation seal, was held void. It seems that a public officer does not bind himself to pay the debt of his principal when, in a sealed instrument, he imposes the obligation upon himself." * 1 Gregor v. Hu son (Tex ), 30 S.W. Rep. 489. 2 Farrell v. Edwards (S. D.), 66 N. W. Rep. 812 As to the prop r manner for corporation officers to sign and indorse negotiable instruments and the liabilities created thereby, see 39 N. W. Rep. 640, note, and 3 N. Y. Supp. 771. note. 3 Mott . Danville Seminary (Ill.), 21 N. E. Rep. 927. 4 Saxton v. Texas, S. F & N. R. Co. (N. M.), 16 Pac. Rep. 851 [1888]; Haskell v. Carnish, 13 Cal. 47 [1889]: Dickerman v. Ashton, 21 Minn 538 [1875] 5 See Whitford v. Laidler, 94 N Y. 145; Appleton v. Binks, 5 East 148: Townsend v. Hubbard, 4 Hill, 351; McCauley . Jenny, 5 Houston (Del.) 132. Mott v. Danville Seminary (Ill.), 21 N. E Rep. 927 [1889]. Knight . Clark (N J.), 2 Atl Rep 780 [1885]; Huthsing v. Bausquet, 12 The Reporter 225; but see Wing v. Glick, 46 Iowa 473 [1881]. * See Secs. 789 and 855, infra. 33. Agents should be Duly Authorized to Contract.-" by or through President, Treasurer, Engineer, or other officer or agent." Every person who enters into a contract with officers or agents of a public corporation is bound at his peril to ascertain the extent of their authority.' He must know the extent of their power conferred by the act of incorporation, and notice all public limitations on their authority. Rules and regulations of a private corporation made and signed by the officers cannot, however, affect contracts made by third parties with their agents without notice of such rules.* 34. Unauthorized Acts of Agent may be Ratified or Adopted.--A private corporation, like an individual, may ratify the acts of its officers or agents done in excess of authority, if it could have authorized the act itself. It is submitted that if a contract with a private corporation or individual were declared void for want of authority in the agent to contract, that the contractor could recover on an implied contract to pay for the benefit it had received, but not upon the contract under which the work was begun. 35. No Claims or Obligations are Created by Contract of Public Officer or Agent who Acts without Authority.-Contracts by public officers, or officers and agents of public corporations, must be strictly within the authority delegated by the act of incorporations. Contracts made in excess of such power conferred by the sovereign power will not bind the corporation, nor is there. any guaranty on the part of the corporation that the forms of law have been complied with because its officers, without authority, attempt to contract. Those dealing with cities and other public corporations must see to it that its agents have power to act, for no liability is incurred for work done under a void contract. They must ascertain at their peril that officers are acting within the scope of their lawful powers. They must ascertain and take notice of the extent and power of a building committee to bind the city. Likewise a party who undertakes work under an order of a court must see to it that the order as entered by the clerk in the records is in accordance with the terms of his agreement, or run the chances of not recov 'Davis v. The City, 3 Phila. 374 [1859]; 1 Dillon Munic. Corp. (Ed 1873). § 372; Baltimore v. Reynolds, 20 Md. 1; Hume v. United States. 132 U. S. Rep. 406; Wells * Mich. Mut. L. Ins. Co (W.Va.), 23 S. E. Rep. 527; Pearce o. Madison & J. R. Co., 21 How. (U S.) 441; Smith v. Co-operative D. Ass'n. 12 Daly (N. Y.) 304; Little . Kerr (N. J.), 14 Atl. Rep. 613. Walker . Wilmington, C. & N R. Co. (N. Car.), 1 S. E. Rep. 366; Griffins v. Land Co., 3 Phila 447 (1859); Blanding Davenport, etc., N. R Co. (Ia.), 55 N. W. Rep. 81; R. R. & B'king Co. v. Skellie, 16 S. E. Rep 657. 14 Amer. & Eng. Ency. of Law 247, and cases cited. 4 181. 5 Wallace v. Mayor of San Jose, 29 Cal. Daly v. San Francisco, 13 Pac. Rep. 321; Hume v. United States, 132 U. S. Rep. 406, and see Dhrew v. Altoona, 121 Pa. St. 411; McDonald v. Mayor, 68 N. Y. 27; Smith v. City of Newburg, 77 N. Y. 136: Davis v. City, 3 Phila. 374; Miller, v. Goodwin, 70 Ill. 659; Bateman v. Mayor, 3 H. & N. 323. Cheeney v. Brookfield, 60 Mo. 53, 17 Amer. & Eng. Ency. Law 157, 15 Amer. & Eng. Ency. Law 507-509; Keating v. Kansas City, 84 Mo. 415; Boston E. L. Co. v. Cambridge (Mass.). 39 N. E. Rep. 787; Osgood v. Boston (Mass.), 43 N. E. Rep. 108. ering for his work. This was a contract to survey, subdivide, map, and classify school lands by a person who had no personal fitness to perform the work, which the commissioners of the court knew. Though it was understood that the person was to employ substitutes to perform the work, it was held that an order entered in the records which fails to mention the fact that the contractor was to employ substitutes, could not be corrected.' Contracts made by a receiver of a railroad company for materials and supplies in excess of the needs of the road cannot be enforced against the receiver. It was held, however, that the contractor was entitled to be reimbursed for expenses incurred in good faith under such contracts." 36. Public Agents Not Liable for Blunders.-A contractor cannot be too cautious and careful in taking public work. Commissioners and boards of public works, city engineers, supervisors, and other officers are likely to mistake the extent of their powers, and to contract for, and order things, for which the contractor can never recover. The innocence and honesty with which the officer oversteps the limit of his authority seem to afford no excuse to the contractor's neglect to ascertain the extent of his powers.' The corporation is not liable, and if the officer has exercised his honest judg ment, and is guilty of no negligence or abuse, he is not liable for innocent blunders or mistakes." * 37. Agent's Authority must Come from His Principal.-Contractors will ask "With whom can I safely contract?" The answer to this must depend upon the circumstances and conditions of each case. If the contractee be an incorporated company it will be well to have access to its charter, in which its powers and purposes will be set forth, and a copy of its by-laws will shed some light upon the powers of the persons exercising authority. If a stock company there will be a board of directors, who, in a strict legal sense, are agents and representatives of the corporation and trustees of the stockholders, but in a practical sense the board of directors become, so far as the company's relations to the public are concerned, the corporation itself." Whatever authority officers, agents, and employees have they must derive from the board of directors or governing power, unless they are conferred by the charter of the corporation or the legislative act creating the body politic. The authority to contract must be given either expressly, impliedly, or by ratification.' Contracts which a corporation may legitimately make, the manner of the making of which is not directed otherwise, may be made by its board of directors without the consent or ratification of stockholders; Gano v Palo Pinto Co. (Tex.), 8 S. W. 634 [1888]. Little v. Vanderbilt (N. J.), 26 Atl. Rep. 1025. 1 Dill. Mun. Corp., § 372. 4 State v. Karn, 81 N J. Law 259. 'Hall v. Crandall, 29 Cal. 567; Hum * See also Secs. 826-859, phrey v. Jones, 71 Mo. 62; Dillon's Mun. Corp., vol. 2 (3d ed.), §§ 588, 978 and 979. 6 Board of Com'rs v. L. M. & B. R. Co., 7 Amer. Corp. Cas. 26. The L. E & St. L. Ry. Co. v. McVay, 96 Ind. Rep. 391 [1884]. "Engineers' Personal Liability." |