Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/335

 PART IV.] LIABILITY FOR TORTS OF AGENTS. [§ 338. whom is given by its fundamental law, or in pursuance of it, every power of action it is capable of possessing or exercising. Hence the rule has been established .... that a corporation is responsible for the acts or negligence of its agents while engaged in the business of the agency, to the same extent, and under the same circumstances, that a natural person is charge- able with the acts and negligence of his agent." 1 Granted that a corporation is liable to the same extent as a natural person for the torts of its agents. Nevertheless, it is not liable for any tort they may commit, however foreign to the nature of the corporate business the tort may be. 2 But, say the court, a corporation can act only through agents. Truly : and the binding quality of the acts of the body corporate itself acting as such, i. e., through a majority vote, is determined by a construction of its powers and the principles of agency. As- suredly there exists no universal agency in the corporation which will render any act of the majority binding. Accord- ingly, to hold the corporation liable for any wrong it might authorize would be to hold the corporate funds, in which are interested dissenting shareholders and innocent creditors, bound by the acts of an agent {i. e., the majority) clearly beyond the scope of his authority and business : a liability far beyond that attaching to individuals for the acts of their agents. There is no decision known to the writer holding a corporation liable for a tort committed in the course of an ultra vires transaction on its face foreign to the corporate business, where the persons who could have objected to the transaction had not acquiesced init.O i?v„ €*0fatft2* * 2>fJames500 (talk)*>l /7# 2*4 /<s^ As before stated, the question is not whether the wrongful act itself was ultra vires • any more than the question would be whether the act itself had been authorized by the corporation. 3 The question is whether the employment or general transaction, in the course of which the tort was committed, was ultra vires ; and if this is answered in the affirmative, the corporation should 1 34 N. Y. 50. The point decided in this case was that the corporation was liable in damages to a bona fide holder of shares issued by the proper officer, but in excess of the amount limited by the charter; undoubted law, but not calling for any statement like that contained in the first part of the citation. 2 Langan v. Iowa, etc., Construc- tion Co., 49 Iowa, 317; § 342, note 1. 3 See Butler v. Watkins, 13 Wall. 456. 315