Blen v. Bear River & Auburn Water & Mining Co.

The president of a private corporation has no authority by virtue merely of his official position to make contracts binding the corporation, except in relation to matters arising in the ordinary course of the business of the corporation.

Where a corporation is engaged in the business of conveying water through ditches for sale to miners, a purchase of additional ditch property with a view of extending the operations of the company is not a matter within the ordinary course of business of such corporation, and its president, as such, has no authority to bind the corporation by a contract for such purchase.

A ratification of a contract made by an agent professing to act therein for the principal, but not having authority for such purpose, must, in order to bind the principal, be made by him with a knowledge of the terms of the contract and the material facts affecting it.

A ratification amounts in itself to presumptive evidence of everything necessary to sustain it. It supposes a knowledge of the thing ratified, and in the case of a I contract the inference from the ratification is that its terms were known; and j to rebut this inference, evidence of mistake or misapprehension is required.

H. the president and also one of the trustees of a corporation made on its behalf a written contract for the purchase of certain ditch property, and immediately thereafter participated in a meeting of the trustees, at which he made a written report stating that he had purchased the property, and stating partially, but not fully, the terms of the contract, upon which the trustees by a vote ratified the report and proceedings : Held, that the Board must be presumed to have known the ¡j terms of the contract which it ratified; that this presumption could only be s overcome by evidence to the contrary, that the facts presented did not show a j want of knowledge, but that from the presence and participation of N. actual *J knowledge by the Board was rather to be inferred.

Whether, when knowledge of facts by the Board of Trustees of a corporation is necessary to the validity of their action, knowledge shown in one of the trustees present and participating in the action will affect the whole Board t—Query.

In order that the vendee may avoid a contract for the purchase of real property on the ground of fraud in the vendor in making the contract, he must repudiate the contract and demand its rescission immediately upon discovering the fraud. The vendee cannot, after discovery of the fraud, remain quietly in possession of the property for a long period of time, and afterwards avoid the contract.

The president of a corporation acting as its general agent, is not, if an interested stockholder, a competent witness for the corporation to testify concerning his acts as agent. The exception to the general rule, by which interested agents are sometimes admitted ex necessitate to testify, is, so far as members of a corporation are concerned, confined to keepers and depositaries of corporate documents.