Manhattan Hardware Co. v. Roland

Opinion, Mr. Justice McCollum: What was said in Manhattan Hardware Company v. Phalen, decided at this term [ante, p. 110], is applicable to this case, and need not be repeated. In February, 1886, Roland, in good faith, loaned to the Manhattan Hardware Company $15,000 upon bond and mortgage. The mortgage was duly executed under the seal of the corporation, and was promptly recorded. It recites a resolution, which appears on the minutes of the corporation, authorizing it. The money secured by it was received by the company and used for its benefit. It is not alleged that any stockholder was ignorant of these transactions, or protested against them. The corporation cannot deny the accuracy of its own minutes, as against a party who loaned it money on the faith of them. The stockholders cannot now dispute the loan on the ground that it was not preceded by a formal meeting and vote authorizing it. They have ratified it by their acquiescence. There is nothing in the affidavit of defence which gives the creditors a standing to contest the mortgage. It follows that the judgment should be affirmed. Judgment affirmed.