Hazelwood Brewing Co. v. Siebert

Citations

• 256 Pa. 9
• 100 A. 493
• 1917 Pa. LEXIS 549

Syllabus

<p>Corporations — Contracts—Negotiable instruments — Promissory notes — Accommodation endorsement — Ultra vires — Defenses.</p> <p>1. While the validity of an act ultra vires of a corporation may be questioned by stockholders, the state, and in some instances by creditors, it cannot be questioned by a stranger to the transaction.</p> <p>2. Where a brewing company became an accommodation endorser of a promissory note, and having paid the note sought to require payment of a prior endorser, the defense that plaintiffs action in endorsing the note was ultra vires, that payment by plaintiff could not have been compelled, and that for that reason it had no right to require payment of defendant, was without merit; the payment of .the note by plaintiff in no way prejudiced defendant or affected his liability, and the court properly directed a verdict for plaintiff.</p>