Belvidere Water Co. v. Town of Belvidere

The opinion of the court was delivered by Swayze, J.

The plea of mil tiel corporation puts in issue only the present existence of the corporation. It avers that there is not, nor ever was, nor on the day of the commencement of this action, nor ever since, in existence any such corporation. Such a plea is obviously met by proof that the corporation existed at any time, and it was therefore proper to reply, as the plaintiff did, that there is and was on the day of the commencement of this suit, and since that day, in existence a corporation called the Belvidere Water Company. The issue joined was the existence of the corporation at and since the beginning of this suit. This was the proper issue. The question to be raised under the plea of mil iiel corporation is the ability of the plaintiff to sue. 1 Chit. Pl. (16th Am. ed.) *464, note g. It is therefore sometimes regarded only as a plea in abatement. Conard v. Atlantic Insurance Co., 1 Pet. 396 , 450, although the better opinion, sustained by the weight of authority, is that it is a plea in bar. 10 Cyc. 1357. The reason for holding it a plea in bar is well stated in a quotation from Brooke’s Abridgement by the Supreme Court of Massachusetts in Christian Society v. Macomber, 3 Metc. 235 , 238: “In an action by a corporation, or a natural body, mis *603 nomer of one or the other goes only to the writ; but to say that there is no such person in rerum natura, or no such body politic, this is in bar; fox if he be misnamed, he may nave a new writ by the light name; but if there be no such body politic, or such person, then he cannot have an action.” The question, therefore, is whether this action is maintainable in the name of the Belvidere Water Company. This depends not upon the de jure but upon the de facto existence of such a corporation at the time suit was brought. Its right to exist can be questioned by the attorney-general acting for the state, hut not by one who contracts with it as a corporation, provided there is a statute under which such a corporation may exist. Stout v. Zulick, 19 Vroom, 599 ; Vanneman v. Young, 23 Id. 403 ; McCarter v. Ketcham, 43 Id. 247. These principles of law are not disputed by the defendant; it contends that there could be no such corporation de jure because the act, under which it purports to be organized (Rev., p. 1365), permitted water companies only in municipalities having at least two thousand inhabitants, and it is said Belvidere lacked that number. Assuming the fact to be as the defendant contends, the legal result does not follow. At the time the su it was brought, the act had been amended so as to apply to any municipality having a population of not more than fifteen thousand and not less than five hundred. Pamph. L. 1880, p. 273. Since the plea challenges only the right to maintain the action, and there could at that time he a corporation de jure, and it is not questioned that every oilier element necessary to make a corporation de facto was present, the plea is not sustained by the proofs.

This conclusion, however, does not suffice to dispose of the pending ease.

The plaintiff claims under a contract made at a time when the law authorized water companies only in municipalities of two thousand population, and the defendant’s claim is that no rights can arise out of a contract which purports to be made with a corporation that could not at that time have a legal existence.

This case, however, does not present the question whether *604 the parties are hound by the contract of 1877, but the much narrower question whether the facts showed an indebtedness of the town to the water company for the amount for which the verdict was directed. Whatever defects there may have been in the original incorporation, it was validated by the act of 1909 (Comp. Stat., p. 3636, pl. 634), for we must assume in the absence of proof to the contrary that the necessary copy of the ordinance consenting to the formation of the company, was filed with the certificate of incorporation. Omnia, presumuntur rite acta. Both the town and the water company have acted on that presumption for thirty years, and clear proof is required to overcome it. For all that time the water company has furnished and the town has paid for water in accordance with the terms of the contract. The plaintiff has been a de facto corporation at least since 1880, and a de jure corporation at least since the validating act of 1909. The necessary inference is that the parties adopted the contract as far as they legally might. 1 Mach. Corp., §§ 329, 332; Battelle v. Northwestern Cement Co., 37 Minn. 89 ; Bond v. Pike, 101 Id. 127 ; Holyoke Envelope Co. v. United States Envelope Co., 182 Mass. 171 . No question is made of the right of the town under its charter to make a contract for a year at a time, and by adopting a contract that provided for an annual rental and pajdng on that basis, both parties became bound at least for the current year. In the absence of proof to the contrary, a contract for a year is a contract for the calendar .year; and so the town has treated it by paying for the hydrants within the limits for the last quarter. The contract was an entire one and the town could not adopt it as to the hydrants within the limits and repudiate it as to the hydrants outside. Four of these were in fact supplied, and although one of these had theretofore been supplied without charge, that was only as part of the whole contract and dependent upon the other four being paid for. The water company was ready to supply the one hydrant that was cut off and the town could not escape its contractual liability by merely disconnecting. The direction of a verdict was-proper and the judgment is affirmed.

*605 For affirmance—The Cehee Justice, Garrison, Swayze, Thenchard, Parker, Bergen, Vooriiees, Minturn, Kalisoi-i, Bogert, Vredenburgii, Vroom, Congdon, White, JJ. 14.

For reversal—xione.