Page:Harvard Law Review Volume 8.djvu/319

LEASE OF RAILROAD. 303 The directors " are authorized and empowered, by themselves or their agents, to exercise all the powers herein granted to the cor- poration, for the purpose of constructing and completing said rail- road, and for the transportation of persons, goods, and merchandise thereon, and all such other powers and authority for the manage- ment of the affairs of the corporation, not heretofore granted, as may be necessary and proper to carry into effect the object of this grant." ^ The lease is no stronger than it would be if the power thus expressly given to the directors were expressly given to the majority of the stockholders. The power given by the contract to the directors is the authority of an agent to act for his princi- pals within the scope of his employment; and this authority is the same whether expressly or impliedly given to a majority of the principals, or to seven or one of them. Its character and extent, and not the number of persons who can exercise it, is the material subject of inquiry. Wh'^ther the joint principals are called part- ners or not, the question of the validity of the lease is a question of agency. In the nature of things it is impossible for the ma- jority of the stockholders to have any other authority to bind the minority by a contract than that of agents. The act of appointing the majority as agents of the minority is the act of the minority, and not the act of the State. It is not legislation. If it were, no appointment of any agent to do any business for any principal could be made by anybody but the State Legislature, or some other law-making assembly. If the stockholders are regarded as a single corporate body, the result is the same. The majority are not that body, but merely a part of it, and agents of the whole so far only as the whole has given them authority. As agents, the majority can do whatever is necessary to carry on, for their principal, the principal's business of a common carrier between Concord and Lebanon. Within limits, they can select the mode and means of executing their agency. The lease, instead of being a mode or means of their carrying on that business for their principal, transfers it to another principal for ninety-nine years, and transfers their principal to the vocation of a landlord and rent-receiver, which is not, in kind or degree, the same business as carrying passengers and freight. The legal scope of their employment is within the bounds of their principal's busi- ness, or, at most, those bounds and a proceeding for winding up 1 Union M. F. Ins. Co, v. Keyser, 32 N. H. 313, 315 ; Bissell v. M. R. Co., 22 N. Y.