
    Morris Horowitz, Respondent, v. The Broads Manufacturing Company, Appellant.
    (Supreme Court, Appellate Term,
    June, 1907.)
    Corporations — Promoters and contracts made before incorporation — Liability of corporation on contracts made before incorporation.
    Evidence — Relevancy — Res inter alios acta.
    Plaintiff agreed, with a person about to participate in the organization of a corporation and who, when the organization was complete, became its president and treasurer, to go to work for a year,' the terms of the agreement being reduced to writing by plaintiff and expressing a contract with such person in his individual capacity; and, when the incorporation was completed, plaintiff went to work for the corporation but at the end of two months was discharged; held that no contract was established with the corporation b.y which it was obliged to continue plaintiff’s employment for a year.
    It was error to admit the paper embodying the agreement made before defendant’s incorporation over defendant’s objection, as well as conversations between the parties prior to the same event.
    Appeal by the defendant from a judgment of the City Court of the city of New York, entered in favor of the plaintiff after a trial before the court and a jury, and also from an order denying defendant’s motion for a new trial.
    Myers & Goldsmith (Emánuel J. Myers, of counsel), for appellant.
    Morris Meyers, for respondent.
   Goff, J.

In his complaint plaintiff alleged that the “ National Waist Company ” was a domestic corporation and that, subsequently to its organization, its name was changed to “ The Broads Manufacturing Company.” He further alleged that, on September first, the defendant corporation employed him as manager in its business for the period of one year at a stated compensation; that he entered upon the performance of his duties, but subsequently the defendant refused to permit him to do so and he in consequence was damaged. A denial' was interposed by the answer. On the pleadings the first issue raised was, did the defendant corporation make an agreement to employ the plaintiff? This the plaintiff asserted as the basis óf his action; and, on it being proved, depended the defendant’s responsibility. -To prove it, competent evidence was required that, by some lawful and binding act, the corporation entered into such agreement; and it follows that, if on that vital point there was no competent evidence, the defendant could not be held to any liability. From the plaintiff’s case .as presented at the trial, it appeared that plaintiff was engaged in the shirt waist business. In August he met one Bernard Broads who made a proposition to him to give up his own business and go to work for him for one year at a stated salary and commission. Broads said he was not yet ready for business and would not be until September first, when the business would be established as a corporation; that, as soon as he got the corporation papers, he Avould start to work and make his final contract with plaintiff. Among other preparations made by plaintiff, he caused a paper to be drawn up which contained the terms of the contract of employment. This paper plaintiff shoAved to Broads and asked him if it contained the conditions they had agreed upon and, if so, to sign it. Broads said it did, but that he would not sign the paper then; and he told the defendant to go to work. On the thirty-first of August there was filed a certificate of incorporation of the “National Shirt Waist Company,’.’ the purpose of Avhieh was the manufacture and sale of waists and skirts; "and its directors for the first year were named as Bernard Broads, president and treasurer, David Broads, secretary, and Victor Hertz. On September the first the business was started by the corporation, and the plaintiff went to work in its shop and remained so working for two months, when some things took place which it is not necessary to mention but which were the cause of the plaintiff’s leaving. During these two months the Avages plaintiff received were paid by the checks of the “ National Shirt Waist Co.” On this proof, it was held that the corporation was liable for breach of contract. For what contract? Before there can be a breach of contract there must be a contract. Where is there evidence here to show that this corporation ever entered into a contract with the plaintiff ? It could not; for, at the time plaintiff claims the contract was made, the corporation was not in existence. How, then, could an artificial creature make a contract before it received the vital spark of legal life ? How could a corporation springing into life on the first of September be bound by any promise or agreement made by an individual in August? It was contended that Broads made the agreement and that afterward, because Broads was named as the president of a corporation, that of itself bound the corporation. But a corporation can only be bound by the acts of its duly authorized officers or agents while acting within the scope of their authority. Broads had no authority, for there was nothing in existence from which he could derive authority. Nor is there any evidence whatever that the corporation ratified or adopted the agreement made by Broads — assuming that there was one. The theory of plaintiff’s case was to hold Broads responsible, for in fact he was the corporation. This it is claimed was so because he stated, “I am the corporation;” but that did not make him the corporation. There were two distinct legal entities, Broads and the corporation, and Broads’ declaration could not efface that distinction. But the plaintiff himself, by the agreement which he prepared for Broads to sign, plainly indicates his understanding of the relations and his intention as'to the person for whom he intended to work. This paper reads: “Agreement made * * * between Morris Horowitz and Bernard Broads as follows, Brpads employs Horowitz for one year from Sept. 1, 1904, as manager,” etc. It then goes on to specify the contractual relations between the plaintiff and Broads. Hot a word is said about the corporation. Testimony was admitted, over objection and exception, as to what Broads said to plaintiff and also to the witness Edelman before the incorporation. This was error. It was als'o error, to admit against objection the prepared writing for agreement which has. already been referred to. These errors cannot be held trifling, for they went to the very root of the issue. The action was conducted on the mistaken theory that the corporation could be held liable for the acts of Broads before the date of incorporation. It may be that in truth Broads incorporated himself, but that does not alter or avoid the rule of law that every individual, natural or artificial, can be held responsible only for his or its acts. For the errors assigned the judgment should be reversed and a new trial granted, with costs to appellant to abide the event.

Gildersleeve and Fitzgerald, JJ., concur..

Judgment reversed and new trial ordered, with costs to appellant to abide event.  