Lewis v. Montgomery

Citations

• 145 Ill. 30
• 33 N.E. 880

Syllabus

<p>1. Advances—whether loans or advance payments—liens on the goods consigned. Advances made by a factor to the consignor of goods under an express contract, which provides that the former shall reimburse himself out of the. proceeds of the goods when sold, are not in the nature of loans of money, but they are payments in advance as to a part of the price. Such advances are liens upon the goods in the hands of the factor, as the primary fund to which he must look for reimbursement, and until that fund is exhausted, he can have no recourse upon the consignor, whose liability is contingent, and only for the deficiency in the proceeds of the goods when sold.</p> <p>2. Corporation—indebtedness in excess of capital stock—advances by a factor. Advances by a factor to a manufacturing corporation of a part of the invoice price of goods, under a contract that the former is to reimburse himself from the proceeds of the goods when sold, do not create any substantial liability or indebtedness against the corporation while the goods are in the hands of the factor and before their sale, within the meaning of Sec. 16 of the act of 1872, relating to corporations.</p> <p>3. Sams—fixing the salaries—whether creating any indebtedness. The fixing of the salary of the superintendent of a corporation and that of the secretary, in the absence of other proof, is not sufficient to show that any corporate debt was thereby incurred, as it will be presumed that such salaries were paid as they accrued.</p> <p>4. Same—proof of incurring the indebtedness. To show the incurring of an indebtedness of a corporation in excess of its capital stock, it is not sufficient to show that various expenditures were ordered or authorized by the board of directors, when, so far as it appears, such expenditures may have been met at the time by cash payments. It must be shown that such expenditures resulted in indebtedness, or formed part of the indebtedness in excess of the capital stock.</p> <p>5. Same—liabilit