Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/766

 § 752.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. XIV. CHAPTER XIV. LEGAL RELATIONS BETWEEN OFFICERS AND CREDIT- ORS OF A CORPORATION. Liability of officers acting on behalf of their corporation, §§ 752, 753. When the contract is ultra vires, §754. Officers' liability to outsiders for the acts of other agents, § 755. Responsibility of directors to cred- itors, § 756. For misapplication of the corporate funds, § 757. For neglect of duty, § 758. Director's duties to creditors on the insolvency of the corporation, §§ 759, 760. Statutory liability of officers to cred- itors. Four classes, § 761. First class, § 762. Second class, § 763. Third and fourth classes, §§ 764- 766. Liability for failure to file annual reports, §§ 767-771. What debts are included in this lia- bility, §§ 772, 773. Liability for signing false reports, §774. Forms of action. Joinder of parties, §775. Liability of officers acting on behalf of their corpo- ration. § 752. Before entering on the discussion of the legal rela- tions between the officers of a corporation and cred- itors whose rights in respect of the corporate assets have already accrued, it will be well to notice the relations between officers acting on behalf of the cor- poration and persons with whom they deal, whose legal relations in respect of the corporate enterprise are first occasioned by their transaction with the officers. In contracting on behalf of a corporation, its officers owe to the person with whom they contract usually no duties which ordinary agents do not owe to persons with whom they con- tract on behalf of their principals. The same degree of fair- ness and good faith is to be observed by officers as is ordi- narily required in the dealings between man and man. 1 And 1 See Edgington v. Fitzmaurice, 29 Ch. Div. 459. An officer who states to a person about to sell goods to the corporation that in his opin- ion the corporation is solvent, will not be liable for his misrepresen- tation if honestly made, although 746 the corporation was insolvent at the time. Searightu. Payne, 2 Tenn. Ch. 175; but will be liable for fraud- ulent misrepresentations. Phillips v. AVortendyke, 31 Hun (N. Y.), 192. The president of a corporation is liable in damages for putting his