His Honour Judge Lobingier has given his decision in the case of the Mao Tung Products Ca. against the Chinese American Provision Corporation, an action involving questions of a guarantee and the rights of an intervener. Mr. R. T. Evans appeared for the plaintiff and Mr. T. E. Simmang for the defendant and intervener.
In giving his decision his Honour said, inter alia:—Defendant is an insolvent corporation for whom a receiver was appointed at plaintiff's instance. Among the many claims presented against defendant those of plaintiff and the intervener were sought to be placed in judgement. But in view of the receivership no judgements will, of course, be rendered, but we shall examine into the validity of the claims of these two parties and enter a judgement directing the applica~ tion upon as equitable a basis as possible, of defendant's limited assets.
On September 14, 1921, I. E. Shulman executed to the plaintiff corporation two promissory notes. for amounts aggregating $6,167.86. Appended to each instrument is the following notation:
"Chinese American Provision Corp. Gnaranteed by H. J. Zimmerman, President"?
The petition alleges that the defendant company has thereby "for valid consideration guaranteed the payment of the above two sums." This averment is expressly denied in the answer which further avers that the "'alleged—instruments of guaranty... are without the powers of the de fendant corporation and_ therefore ultra vires." It is well settled that an officer of a corporation "cannot bind it by a contract of indemnity, guaranty, or suretyship, unless he is cither expressly er impliedly authorized to do so."
Aside from the form of the insstrument (which purports to be hardly more than a guaranty by the president himself) we are unable to find from any competent evidence in the record that the president of the defendant corporation had any express or implied authority to execute the guaranties in question and plaintiff is consequently not entitled te judgement thereon over defendant's cbjection-
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