Hussey v. Norfolk Southern Railroad

Davis, •!., (after stating the case). The question presented by the appeal is: Was there error in sustaining the demurrer of the defendant company, as set out in paragraphs “a,” “b” and “ c ” of the first cause of demurrer ?. The Code, §233, requires that the complaint shall contain “ a plain and concise statement of the facts constituting a cause of action, without unnecessary repetition.” The facts should be so stated as to leave the defendant in no doubt as to the alleged cause of action against him, so that he may know how to answer, and what defence to make. The demurrer admits the facts contained in this complaint. Do they constitute a cause of action? The defendant company says no. It is true, that the defendant King is the general manager of the co-defendant company’s business, and that the defendants King and The Norfolk Southern Railroad Company did the acts complained of, and the chai’ge upon which the alleged malicious prosecution was instituted, and the false arrest and imprisonment made, was the alleged embezzlement of the money of the defendant company, and the warrant was sued out by the defendants, upon the written affidavit of the defendant King, general manager of the defendant company; but, says the defendant company, the plaintiff fails to allege that these acts were done, by King, “in the scope of his authority or duty as agent,” &c., and therefore he cannot recover. It is admitted (the demurrer admits) that the acts •were *40 done by the defendant; if so, does it matter how? Is it necessary to'allege that the agent was authorized to do them, and that he was acting within the scope of his authority and duty ? It must be necessary to prove any material fact, necessary to be alleged, unless admitted. If corporations, as we shall presently see, are liable for torts and wrongs committed ultra vires, outside and beyond 'the purpose of their creation, and not within the scope of their granted powers and authority, it would seem a logical absurdity, to say that any tort or wrong so committed, was committed, or could be committed, by an agent or servant within the scope of the authority of such agent or servant. If the acts were ultra vires, they could not be within the scope of the power or authority of the company, or of its agent or servant, and the allegation, if necessary to be made, could not be proved, and the plaintiffs must fail. This cannot be so. It was long thought that as the corporation has no mouth with which to utter slander, or hand with which to write libels, or commit batteries, or mind to suggest malicious prosecutions or other wrongs — as it was an artificial person and could speak and act only through and by the agency of othi rfe, it was, therefore, not liable for any torts except such as resulted from some act of commission or omission of its agents or servants, while acting within the scope of granted powers, or wrongfully omitting or neglecting some duty imposed by its charter or by laws; and consequently it was necessary to allege that the act committed was while acting within the scope of the power and authority of the company, or that the act omitted was required to be performed. Whether it was wise to depart from this rule, that exempted corporations from liability for the acts of agents in cases where the character of the act depended upon motive or intent, seems no longer an open question. *41 The old idea that because a corporation had no “ soul,” it could not commit torts or be the subject of punishment for tortious acts, may now be regarded as obsolete. The rights, the powers, and the duties of corporate bodies have been so enlarged in modern times, and these “ artificial persons” have become so numerous, and entered so largely into the every day transactions of life, that it has become the policy of the law to subject them, as far as practicable, to the same civil liability for wrongful acts, as attach to natural persons, and this liability is not restricted to acts committed within the scope of granted power, but a corporation may be liable for an action “ for false imprisonment, malicious prosecution, and libel.” Pierce on Railroads, 273. “ The doctrine which once obtained that the master is not liable for the wilful wrong of his servant, is now understood as referring to an act of positive and designed injury, not done with a view to the master’s service, or for the purpose of executing his orders. ****** Whether the servant did the act with a view to the master’s service, or to serve a purpose of his own, is a question for the jury.” Ibid., 279. Whether the corporation authorized or participated in the tort is matter for proof, and the defence of ultra vires is not admitted. Ibid, 520. It is true that it was held in Orr v. The Bank of the United States, 1 Hamm., Ohio Reports, 25, that a corporation could not be sued in an action for assault and battery, nor could it be joined in such an action with other defendants, and in Gillett v. Missouri Valley R. R. Co., 55 Mo., 315, it was held by a divided Court, that a railroad corporation was not liable for a malicious prosecution in the name of the State for alleged embezzlement of its funds, but a different doctrine seems now well established. “ Corporations are liable for every wrong they commit, and in such cases the doctrine of ultra mres has no application. *42 They are also liable for the acts of their servants while such servants are engaged in the business of their principal, in the same manner, and to the same extent, that individuals are liable under like circumstances. An action may be maintained against a corporation for its malicious or negligent torts, however foreign they may be to to the object of its creation, or beyond its granted powers. It may be sued for assault and battery, for fraud and deceit, for false imprisonment, for malicious prosecution, for nuisance and for libel.” National Bank v. Graham, 100 U. S., 699, and many authorities there cited; Merchants’ Bank v. State Bank, 10 Wallace, 645; Angell & Ames on Corporations, §388. “ It is no defence to legal proceedings in tort, that the torts were ultra vires.” Gruber v. Railroad Co., 92 N. C , 1. Philadelphia, Wilmington & Baltimore R. R. Co. v. Quigley, 21 Howard, 202, was an action against the defendants (plaintiffs in error) for libel. It was insisted that the railroad being a “ corporation with defined and limited faculties and powers, and having onty such incidental authority as is necessary to the full exercise of the faculties and powers granted by their charter; that being a mere legal entity, they are incapable of malice, and that malice is a necessary ingredient in a libel; and the action should have been instituted against the natural persons concerned in the publication of the libel. But a different view was taken by the Court, and it was held that a corporation could be held liable ex delicto, as well as ex contractu, and that this view was in consonance with the legislation and jurisprudence of the States of the Union, relative to “ these artificial persons.” The subject is discussed at length in Williams v. Planters’ Insurance Co., 57 Miss, 759, and the note to the case as reported in 34 Am. Rep., 494, in which the authorities are collated, from which the conclusion is fully warranted, that a corporation is liable for malicious prosecution conducted by one of its agents. *43 In the still more recent case of Denver & C. R. R. Co. v. Harris, 122 U. S., 597, in an elaborate opinion, in which many authorities are cited, it is said : “ If a corporation has itself no hands with which to strike, it may employ the hands of others; and it is now perfectly well settled, contrary to the ancient authorities, that a corporation is liable emitter for all torts committed by its servants or agents by authority of the corporation, express or implied. ***** The result of the modern cases is, that a corporation is liable emitter for torts committed by its servants or agents, precisely as a natural person; and it is liable as a natural person for the acts of its agents, done by its authority, express or implied, though there he neither a written appointment under seal, nor a vote of the corporation constituting the agency, or authorizing the act.” “The corporation, and its servant, by whose act the injury was done, may be joined in an action of tort in the nature of trespass.” Pierce on Railroads, 292. In the case before us, the “statement” contained in the complaint, is sufficiently “plain ” to enable the defendant company to understand clearly and without mistake, the nature of the tort with which it is charged, and it is thus enabled to answer and prepare intelligently for its defence. There is error. The demurrer is overruled, and the defendant may take such action below as he is advised. Error.