to the purposes for which the same was formed,1 but they have no power to engage in a class of business for the transaction of which the company was not formed, and where such contracts are entered into, the corporation cannot be estopped by deed or otherwise, from showing that it had no power to do that which it purports to have done.2 Where the limitations of the directors' authority to bind the company is made public, or the purposes for which the corporation was formed can easily be obtained, the public dealing with the corporation is bound to notice its regulations and the extent of the directors' powers, and those dealing with the company assume the risk of entering into contracts which the corporation had no power to make.3 But this doctrine is based upon the necessity of protecting the shareholders from liability resulting from unauthorized acts of directors, and although one dealing with the directors with full knowledge of the limitations of their authority would have no recourse, either against the corporation, or the directors; where one who is ignorant of the limitations on the power of the directors enters into a contract with them in good faith, they can be held personally liable in respect to such a contract, if it afterwards develops that in entering into the contract they assumed powers which they did not, in fact, possess.4

§ 319. Same Whether Irregular acts intra vires. the directors are to be regarded as the special agents of

1 Wood Hy. H. M. Co. v. King, 45 Ga. 34.

2 McCullough v. Moss, supra.

3 Watts' App., 78 Pa. St. 423.

4 Lindley Part., Secs. 250 and 252 and cases cited; Beach Priv. Cor., Secs. 421, 434. The burden is on the party alleging ultra vires. Allen v. West Point Mining Co. (Ala. 1902), 31 South. Rep. 462.

the corporation for certain purposes, or whether they are to be considered the general agents of the company, for the purpose of transacting its business, is a question upon which the authorities have differed widely, but the tendency of the courts is to hold the directors to be special, rather than general, agents of the corporation. However this may be, it is well settled that the company is bound by the acts of the directors, which are within the general scope of their authority, whether they acted in the manner prescribed by the regulations of the company or not.2 In this particular there is a practical distinction between acts which are entirely beyond the power of the directors to perform, and those which they can perform conditionally, provided certain requisites which have been prescribed by the by-laws or charter of the corporation are complied with. The first are commonly called acts ultra vires, and the second, although intra vires, are irregular. With the exception of their liability on commercial paper which has passed into the hands of bona fide holders, corporations are not generally liable for the acts of their directors, which are altogether beyond the scope of their authority; 3 but they would be liable to persons who deal with the directors, in good faith, for acts which the directors had power to perform, provided they had complied with certain conditions, although they should fail to comply with the conditions prescribed for the performance of those acts, if

1 They are the trustees for the stockholders and corporate creditors. Simons v. Oil Co., 61 Pa. St. 202. They can but act for and not against the interests of the company. Id.

2 Union M. Co. v. Bank, 2 Colo. 248. Unless restrained, the directors can exercise the ordinary powers of the corporation. Wood Co. v. King, 45 Ga. 34.

8 Tiedeman on Com. Paper, Sec. 116 and cases cited; Beach Priv. Cor., Secs. 421, 434.

the persons dealing with the corporation had no notice of the irregularities of which the directors had been guilty.1

§ 320. Authority of the president. - The president of a mining corporation has no authority by virtue of his position, merely, to make contracts binding the corporation, except as to matters in the ordinary course of the corporate business.2 As a general rule the corporation could not be held upon any unauthorized contracts of the president to buy or sell property; he could not acquire either by assignment 5 or lease,6 the entire property of the corporation to the injury of its creditors, but the corporation and its 'assets in his hands would remain liable for its debts; nor would it, generally, be liable for commercial paper issued by him, unless for legitimate business of the company.7 But as the chief officer and agent of the company the president can convene and supervise, generally, the business of the managing board; 8 can assume general control of the corporation affairs, handle its property, pay its debts and manage its business, and generally bind the corporation, so long as he acts the part of a faithful officer,

1 Lindley on Part, Sec. 250 and citations; Tiedeman Com. Paper, Sec. 116; Beach Priv. Cor., supra.

2 Blen v. Bear River & A. W. & M. Co., 20 Cal. 602. He cannot bind the corporation by the ratification of an unauthorized contract of its superintendent. Union M. Co. v. Bank, 2 Colo. 248.

3 Blen v. Bear River &c. Co., supra.

4 Crump v. U. S. Mining Co., 7 Gratt. (Va.) 352. Unless appointed its agent to sell, his representations are not binding upon the company. Crump. U. S. M. Co., 7 Gratt. (Va.) 352; Barnard Bank v. Tessler, 89 Mo. App. 217.

5 Conro v. Port Henry Iron Co., 12 Barb. 27.

6 Ante, idem.

7 Moss v.

Livingston, 4 N. J. 208; Rand v. Hale, 3 W. Va. 495. 8 Union G. M. Co. v. Bank, 1 Colo. 532.

within the line of the company's business; 1 render it liable for debts contracted in the course of its business,2 and on commercial paper for legitimate corporate debts or money borrowed by the corporation.3 On account of his trust relation, however, the president is held to the utmost good faith; can derive no secret advantage of the corporation; 4 must make full disclosures, and unless provision is made in the by-laws, he cannot recover for his services.6

§ 321. Rights and powers of mine superintendent.— The rights and powers of a mine superintendent, like any other agent of a corporation, are limited to those conferred on him by the corporation and such implied powers as are necesary to enable him to enforce those expressly given him by the company.7 He does not acquire any implied powers by virtue of his office, and unless the corporation. has given him the express authority to contract debts, he will not have any right, by virtue of his position merely, to borrow money on the credit of the corporation. If a mine superintendent borrow money without any express authority given him by the corporation, the president of the company, as such, has not the power to ratify the contract of the agent, and to undertake, in the name of the corporation, for the repayment of the unauthorized loan,

1 Ante, idem.

2 Savage v. Ball, 17 N. J. Ch. 143.

8 Moss v. Oakley, 2 Hill, 265; McCulloh v. Moss, 5 Den. 567; Magee v. Maklumne Min. Co, 5 Cal. 258.

4 Cumberland &c. Co. v. Parish, 42 Md. 598.

Conro v. Port Henry Iron Co., 12 Barb. 27.

6 Merrick v. Peru Coal Co., 61 Ill. 472.

Atty.-Gen. v. Jackson, 5 Hare. 355; Carpenter v. Biggs, 46 Cal. 91.

8 Moss v. Ashley, 2 Hill, 265; McCulloh v. Moss, 5 Denio, 566. To relieve himself of personal liability superintendent may show paper was executed for company and that the payee so understood. Schafer v. Bidwell, 9 Nev. 209; Gerber v. Stuart, 1 Mont. 172.

for such authority could only be conferred or exercised by the stockholders or directors of the corporation.1 The same rules apply in regard to written instruments and commercial paper, executed by the superintendent of a mining company, and in the absence of express authority given by the corporation, he will not have any power to change the terms of a written instrument, or to bind the corporation by any species of commercial paper.3 His commercial paper made · without authority from the corporation, unless he derives his power from the established custom of the company, or the recognized usage of his predecessors, is absolutely void in law, and the assignment of such paper does not operate as an assignment of the indebtedness for which it is given, even though the paper was given in payment for articles necessary for the use of the mining operations.5

§ 322. Company bound by what acts of superintendent. The superintendent or manager of a mining company has full authority to bind the company, as to those with whom he is dealing, for all acts within the real or apparent scope of his authority, and this applies as well to contracts with employees to work in and about the mine, as to contracts for materials necessary for carrying on the mining operations, and the company would ordinarily be bound by all such contracts entered into by its superintendent.6 But the superintendent has no implied power to borrow money

1 Union G. M. Co. v. Rocky Moun. Nat. Bank, 2 Colo. 565; 248.

2 Lankey v. Succor M. & M. Co., 10 Nev. 17.

3 Carpenter v. Biggs, 46 Cal. 91; Union Gold Min. Co. v. Rocky Mountain Nat. Bank, 2 Colo. 565.

4 Tiedeman on Com. Paper, Sec. 243.

• Skillman v. Lackman, 23 Cal. 198; Gillig v. Lake Brigler &c. Co., 2 Nev. 214.

6 Adams Min. Co. v. Senter, 26 Mich. 23; Jones v. Clark, 42 Cal. 180; B. & W. L. C. 525 et seq.