Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/238

 § 257.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. VII. tract was actually executed is obviously immaterial, his rights will not be affected. Thus, the charter of a corporation required a certain number of managers " to constitute a quorum with power to enter into a contract." The contract before the court was actually sealed and executed by a less number ; but the court held it valid, there being no evidence to show that it had not been authorized by the requisite number. 1 § 255. In certain cases where, as a matter of fact, the person w, contracting 1 with the corporate agent is far less con- V lien cor- ° i i>. .rate versant with the nature of the business in hand than contracting the corporation and its agent, the court has permitted nofstand him, when he has in entire good faith performed his trams 1 * 1 S ^ e °^ ^ ne con tract, to hold the corporation ; although some formality with knowledge of which he must be held affected is not complied with, and he knows or is affected with notice of its non-observance. Thus, an insurance policy- contained a provision that if any subsequent insurance should be made on the same property, the policy should become null and void, unless a consent to the further insurance should pre- viously have been given in writing. The insurance agent orally consented, and the insured in good faith paid out his mone} r in reliance thereon. A loss occurring, the court held that the company could not defend on the ground that the consent was not in writing ; because such a defence would be a fraud on the insured. 2 § 256. If after an act is irregularly done, even in a manner which would not have held the corporation, the cor- tion! Ca ~ poration ratifies or acquiesces in the act as done, the corporation will be bound. 3 § 257. As provisions requiring the observance of formalities 1 Berks, etc., Turnpike Co. v. Myers, 6 S. & R. 12. The defective execution of a mort- gage by an agent who has authority to execute it, will not invalidate the mortgage when the intent is plain. Taylor v. Agricultural, etc., Ass'n, 68 Ala. 229. See, also, Bernards Town- ship v. Stebbins, 109 U. S. 341, § 328. 218 2 Carrugi v. Atlantic Fire Ins. Co., 40 Ga. 135. Compare Wheeler v. Smith, 9 How. 55. 8 Chouteau v. Allen, 70 Mo. 290; State of Florida v. Florida Central R. R. Co., 15 Fla. 690. I