Chicago & North-Western Railway Co. v. James

Aoenoy. Railroads : Power of director or vice-president of railway company to sell lands, etc. — Evidence of .such power. 1. Under the principles which usually govern such corporations, neither a director nor vice-president of a railway company is empowered to hind it hy his acts, such as appointing agents to protect its lands, or to sell the lands or timber, 2. In an action where the defendant claimed rights growing out of the exercise of such a power hy a director and vice-president of the plaintiff company, held, that the authority of such officer must he shown hy the same kind of evidence that would he required in the case of any other agent; as hy resolution of the hoard of directors, hy verbal appointment made under their authority, or hy proof that they had knowledge of and acquiesced in the action of the officer.

APPEAL from the Circuit Court for Winnebago County. Action for damages for a conversion by defendants to their own use of a lot of pine logs alleged to have been cut on plaintiff’s land and to have been its property. The defense was, that defendants bought the logs'of oné Weatherby, by whom the logs were cut (in the winter of 1865-6) under a license from James McGillan, who acted as agent for the plaintiff. On the question whether McGillan had authority to grant the license, the evidence on the part of defendants was as follows: E. C. Goff: “I am timber agent of the plaintiff P. IT. Smith appointed me. James McGillan was before me, and C. Foote before him. I know this only by rumor; have no knowledge that McGillan acted as timber agent.” P. PI. Smith: “I reside in Chicago, and am vice-president and one of the directors of the plaintiff company, and have been since 1859.” Question: “Was James Mc-Gillan ever the timber agent of the company ? ” Answer (against plaintiff’s objection): “We never had any officer known as timber agent. "We have bad an agent to look after the land of the company, and to prevent trespasses. Mr. Goff is such agent now; Mr. James McGillan preceded Goff, and Mr. Eoote preceded McGillan. Eoote acted about two years; McGillan about the same. McGillan ceased to act in the winter of 1866. He had nothing to do except during the winter; was employed by the day. He acted by my appointment.” The licenses from McGillan to Weath-erby were then put in evidence. Weatherby, testified that for a year or two before taking these licenses he had understood that McGillan was plaintiff’s agent; did not know of his selling timber; did not know, of his own knowledge, of Foote’s doing so. Mr. Fitzgerald testified that he bought logs on plaintiff’s land from Eoote in 1862, and took it off in the winter of 1863; and afterwards the plaintiff recovered a judgment against him for the amount, the complaint being for stumpage sold by plaintiff to him. The judgment roll in said action was put in evidence, and the complaint therein was verified by one Strong as assistant superintendent of the plaintiff company.' N. Leavitt testified that he bought stumpage on plaintiff’s land from McGillan in the winter of 1864, and had never heard anything about it from the company. A written direction (to McGillan ?) to sell to one Hunter stumpage on a specified tract of plaintiff’s land, if not already sold, which direction was entered in Hunter’s memorandum book, and was signed by P. H. Smith, was also read in evidence, and Hunter testified: “ When I went to Smith I asked him who was agént for plaintiff’s land; he said, McGillan;’ I told him I wanted to buy; he said Weed was bargaining for them, and if any was left, I could buy of Mc-Gillan.” Another witness : “In 1864, I bought timber on plaintiff’s land from McGillan; paid him for it, and cut it that year. P. H. Smith referred me to McGillan; said I could get. the land I wanted, he presumed, if it was not already taken.” Another: “In 1865-6, I-purchased timber of McG-illan on lands of plaintiff, and paid him therefor. I heard he was agent and went to see him; nobody called on me a second time for pay. I bought more than once.” Another: “In 1862, I purchased timber on plaintiff’s land of C. D. Foote, and paid him for it; took it off in 1862 and 1863; never heard any complaint about it. I got R. Campbell to see P. H. Smith for me at Chicago; he did so, and Smith wrote me, and Foote has our letters.” All this evidence was received against plaintiff’s objections. For the plaintiff, P. H. Smith testified: “ C. D. Foote acted under my direction; he was authorized to protect plaintiff’s lands from trespasses. He had no authority to sell land or stumpage, except when there was application to us for purchases in particular eases. He was employed to go on lands to see if any trespasses had been committed, and warn people off. I never knew of his making any sales, except in three or four cases, and then he had special permission. Employed McGillan simply to protect lands against trespasses, and no sales permitted except in particular authorized cases. I had no knowledge McGillan was making sales, except as authorized in special cases, and as soon as I knew of it, I discharged him. I remember of one or two more coming to me about buying land. I presume I referred them to McGillan for the purpose of having him advise me as to condition of land, its value, etc., that sale might be authorized if thought best; never authorized the sale to “Weatherby.” 0. D. Foote : “P. H. Smith employed me; I was not authorized generally to sell stumpage; think I did in three cases; in each case Smith instructed me to sell.” The court gave the jury the instruction recited in the first sentence of the opinion. Verdict for the defendants; new trial denied; and plaintiff appealed from a judgment on the verdict. contended, among other things, that the acts of a director or other officer of the plaintiff company will not bind it, unless within the scope of his ordinary powers or some special agency. Soper v. Buffalo fe. B. B. Co., 19 Barb., 810; National Bank v. Norton, 1 Hill, 572; L. f id Ins. Co. v. Mechanic F. Ins. Co. of N. Y., 7 "Wend., 31; Stephenson ,v. N. Y. H. Bailroad, 2 Duer, 341; Hoyt v. Thompson, 5 N. Y., 320; Hallowell ¿-c. Bank v. Hamlin, 14 Mass., 178; Hartford Bank v. Barry, 17 id., 95. cited in support of the instructions given, Warren v. Ocean Ins. Co., 4 Shep., 439; 3 Met., 282; 9 Porter, 210: 3 Gratt., 215; 34 N. H., 278.J