respective departments of service is that of the corporation or is the legal equivalent of such knowledge by it.1

§ 754. Must be received officially.--A corporation is not bound by notice to mere stockholders. Nor is knowledge of a director of a bank acquired unofficially that a note discounted by his bank before maturity is illegal or without consideration deemed notice to the bank.

But as notice to a corporation can only reach it through agents, it cannot be considered prejudicial to it to place its agents in its stead, to the extent of the course of business in which they are engaged.*

But the corporation is not bound by notice to its agent except so far as the latter represents it; and the notice to such agent after the termination of the period

Where none of the

1 Denver, etc., R. Co. v. Conway, 8 Colo. 1; 5 P. 142. officers or agents of a bank had any actual notice of any infirmity of a note purchased by the bank, but one of the directors, who was also a member of the discount committee of the bank, was the president and general manager of another corporation, one of whose agents, not the president and general manager, had actual notice of an infirmity of the note such as would require this agent's own corporation to take constructive notice of such infirmity, the bank may nevertheless be considered as an innocent purchaser of the note without notice of any infirmity affecting it, notwithstanding the fact that the other corporation had constructive notice through its agents of such infirmity. Mann v. Sec. Nat. Bank of Springfield, Ohio, 34 Kan. 746; 10 P. 150; Manufacturers' Nat. Bank of Racine v. Newell, 71 Wis. 309; 37 N. W. 420.

* Burt v. Batavia Paper Mfg. Co., 86 Ill. 66. A stockholder of an irrigation company was held not bound by notice of an underlined contract limiting the duty of the corporation in the matter of furnishing water at certain times contrary to its general contract with him. Gray v. Salt R. Val. Canal Co. (Ariz.), 12 P. 607. A different conclusion was reached when notice was given to one who was the sole owner of all the stock., Orr. W. D. Co. v. Reno W. Co., 19 Nev. 60.

* First Nat. B'k v. Christopher, 40 N. J. 435. Compare Craigie v. Hadley, 99 N. Y. 131; 1 N. E. 537.

4 Notice to the president of a bank that certain shares of stock standing in the name of a party were purchased with trust funds belonging to his wife is notice to the bank, and it was held sufficient if the notice were in general terms and yet calculated to put the president upon inquiry. Porter v. B'k of Rutland, 19 Vt. 410.

or transaction in which he acts in.its stead and place is not sufficient to bind it. But it has been held unimportant whether the notice was received in the course of the particular dealings or upon some prior occasion.2 Notice to the board of directors when assembled is binding on them, their successors, and the corporation.3

§ 755. Must affect transactions entrusted to them.—In order that notice to an agent shall be binding upon the corporation it must concern a matter or transaction falling within his department of business, after such relation commenced and before it has ended. But this qualification of the rule does not apply to matters of general concern of which a record is made in the books of the corporation. Officers and agents of a corporation, having in their power the inspection and supervision of its books, are as much bound prima facie by the entries found therein as a partner would be bound by the books of the firm.5

1 Bank of U. S. v. Davis, 2 Hill, 451. Notice of conveyance to which the wife of the president of a railroad corporation was a party, was shown to have come to him directly, but not in the course of official duty; and it was held that the company was not bound by his knowledge of the transaction. Winchester v. Bait. & Susquehanna R. R. Co., 4 Md. 231.

2 Craigie v. Hadley, 99 N. Y. 131.

3 Fulton B'k v. Canal Co., 3 Paige Ch. (N. Y.) 127, Custer v. Tompkins County B'k, 9 Pa. St. 27; Genl. Ins. Co. v. U. S. Ins. Co., 10 Md. 517; U. S. Ins. Co. v. Shriver, 3 Md. Ch. 381. Notice to an engineer appointed to superintend the construction of a bridge of a proposed alteration in the plans; Danville Bridge Co. v. Pomeroy, 15 Pa. St. 151; to the secretary of an insurance company whose duty it was to receive preliminary proofs of a loss that has occurred; Troy Fire Ins, Co. v. Carpenter, 4 Wis. 20, have been held binding upon the corporations respectively represented by them.

+ Goodloe v. Godley, 13 Smed. & Marsh, 233; Hauserman v. Bldg. Ass'n, 81 Pa. St. 256; Lothian v. Wood, 55 Cal. 159. Where the authority of an architect is specially conferred in a written contract for a building, he is not authorized to receive notice of an assignment of a building contract so as to bind the owner of the building by such notice, if such an authority is not expressly conferred. Renton, etc., Co. v. Monnier, 77 Cal. 449.

5 Montgomery v. Exch. Bank (Pa.), 6 A. 153.

§ 756. Statements and admissions of officers and agents.— The declarations and admissions of agents during the transaction of the business are as much those of their principals, within the scope of their employment, as are their acts, both being part of the res gesta.1 But to render a declaration of an agent admissible to bind a corporation there must be some preliminary proof showing his duties, and that it was made within the scope of his authority.2

1 Northrop v. Miss. Val. Ins. Co., 47 Mo. 435; Western Boatman's Benev. Ass'n v. Kribben, 48 Id. 37; Florida M. & G. R. Co. v. Vannedoe, 81 Ga. 175; Morris & Essex R. R. Co. v. Green, 15 N. J. Eq. (2 McCarter) 469. The statement made to a shipper by one who was president, general manager, and controlling owner of a transportation company, that a loss of property transported by it was due to the company's negligence is admissible in an action against the corporation, though the president's information in the premises may have been derived wholly from hearsay. Costigan v. Michael Turnp. Co., 38 Mo. App. 219. An insurance was effected with an insurance corporation through the agency of a solicitor, the insured not meeting with the company's agent who issued the policy during the transaction. In an action upon the policy, it was held that conversations between the insured and the solicitor during the course of the transaction were admissible in evidence. Fishbeck v. Phoenix Ins. Co., .54 Cal. 422. But in an action for the specific performance of a parol agreement entered into by an agent on behalf of his principal, a declaration by such agent a year or two after the consummation of the agreement, with respect to the terms thereof, were excluded in an action against the principal. Clunie v. Sacramento Lumber Co., 67 Cal. 313. Since the acts of corporate agents, and even of corporate bodies, may be established independently of the written minutes of their proceedings, the declarations of the trustees of a religious corporation were held admissible to show the possession of land held by the corporation and the extent of its claim in an action of ejectment. Magill v. Kaufman, 4 Searg. & R. 317. 2 Spaulding v. B'k of Susquehanna County, 9 Pa. St. 28. A treasurer was held not authorized to bind the corporation by an admission of indebtedness. Tripp v. New Metallic Packing Co., 137 Mass. 499. The same rule was held to apply to an admission of indebtedness by the president of a bank, the principle being that debts can only be created, discharged and annulled in the regular course of business and in some manner pointed out in the charter or by-laws. Spyker v. Spence, 8 Ala. 333; Henry & Co. v. Northern B'k of Ala., 63 Ala.527. An admission by the president of a corporation, made on the discharge of the manager of the corporation, that royalties on certain patents assigned by the manager to the corporation in consideration of his appointment would be paid after his discharge, would not bind defendant, in the absence of evidence that he was authorized by the company to make such promise or put such construction on the contract. Johnson v. Union Switch & Signal Co., 13 N. Y. S. 612.

Where one claims to be an agent of a corporation, evidence that other agents or officers with less authority than the appointing power permitted or declared him to be an agent will not be sufficient."

Neither the president nor the cashier of a bank, nor the cashier and one of the directors, nor all of them combined can release the maker of a note from his liability as such, by an admission that he is not legally bound.2

§ 757. Representations of agents. Nor can either or any two of them or all bind the bank by a representation that the indorser of a note is perfectly solvent, and that the indorsee is entirely safe in becoming his indorser, unless such statement being made in the usual course of business amounts to a guaranty. Otherwise such declarations and representations are not within the course of their duties and can no more bind their principals than the declarations and recommendations of third parties.3

Statements by individual directors when not acting as a board or a committee, meeting under express authority from the board, are not binding upon the corporation. Nor are statements made in discussion while the board is in session competent evidence to prove a contract.1

1 Alleghany Co. Workhouse v. Moore, 95 Pa. St. 408 where a banking company being incorporated by the same name with a former one, and having appointed the same president and cashier, received and issued the notes of the former company, the officers of the new company frequently declaring that there was no difference between those notes and those issued by the new company, it was held that these acts and admissions did not make the stockholders of the new company liable for the notes of the old. Wyman v. Hallowell & Augusta B'k, 14 Mass. 57.

2 Hodge v. First Nat. B'k, 22 Gratt. 51; B'k of U. S. v. Dunn, 6 Pet. 51; U. S. v. City B'k of Columbus, 21 How. 356.

3 Mapes v. Second Nat. B'k, SO Pa. St. 163.

4 Peek. Detroit Novelty Wks., 29 Mich. 313. See Imboden v. Etowah Battle Branch, etc., Min. Co., 70 Ga. 86; Coyle v. Balt. & Ohio R. R. Co., 11 W. Va. 94; Smith v. Woodville, Consolidated Silver Mining Co., 66 Cal. 398.

Those admissions and declarations only are admissible which are made by the agent while transacting the business of the principal and as part of the transaction then depending.'

To be admissible, the statement need not partake of the nature of narrative or rehearsal. But it must be original and constitute part of the fact to be proven.2

THIRD. OF THE DEFENCE OF A LACK OR EXCESS OF CORPORATE AUTHORITY.

§ 758. Matters which enter into a consideration of the subject.—In the determination of the validity and effect upon the rights of the parties of every act of a corporation alleged to be invalid for lack of corporate authority, several distinct propositions have to be considered. If it is within the chartered powers the only question which can arise, is as to the authority of the particular agent who performed the act. This particular branch of inquiry has been elsewhere treated.3

An act having been done by an agent without the

1 Ladd v. Couzins, 35 Mo. 516; McDermott v. Hannibal & St. Joseph R. R. Co., 73 Id. 516; Adams v. Same, 74 Id. 553; Stiles v. Western R. R. Corp., 8 Metc. 44; Sweatland v. Ill. & Miss. Tel. Co., 27 Ia. 433. Statements of a conductor concerning the movements and condition of the train under his supervision while managing it or soon after reaching its destination, or of a baggage master concerning the manner of the loss of a trunk, in answer to inquiries made soon after its loss, it being a part of his duty to deliver the same or account for it in case of its loss, are evidence against a railroad company. Morse v. Conn. Riv. R. R. Co., 6 Gray, 450; Lane v. Boston & Alb. R. R. Co., 112 Mass. 455. But not those of an engineer made several days after an accident as to how it occurred. Robinson v. Fitchburgh, etc., R. R. Co., 7 Gray, 92.

2 Expressions of pain made by the injured party at the time of receiving an injury, are in the nature of occurrences and are admissible as evidence of a mental or bodily condition at the time. Hogenlocher v. Coney Island, etc., R. R. Co., 99 N. Y. 136. But a remark of one trainman to another as If you had stopped the train when I told you, you would not have killed him" was held not admissible. Adams v. Hannibal & St. Jo. R. Co., 74 Mo. 553.

a Supra, Ch. IX., § 739, et seq.