the powers and duties of the corporation; and if any greater authority is claimed it must be sought for in an express or special grant from the legislature. It is scarcely necessary to observe that no contract can be made by a corporation which is prohibited by its charter or by the statute law of the State. And it is a general and fundamental principle of law that all persons contracting with a municipal corporation must at their peril inquire into the power of the corporation or of its officers to make the contract; and a contract beyond the scope of the corporate power is void, although it be under the seal of the corporation." This principle is more strictly applied, and properly so, than in the law of private 1 Jackson v. Bowman, 39 Miss. 671 (1861); Indianapolis v. Indianapolis Gas Co., 66 Ind. 396, citing text. Contracts to violate the charter, or to bargain away or restrict the free exercise of legislative discretion, vested in a municipality or its officers, in reference to public trusts, are void. Ib.; Thomas v. Richmond, 12 Wall. 349 (1870), in which notes issued by the city to circulate as money in contravention of law were adjudged void, and the city held not to be liable either in special or general assumpsit; Morgan v. Menzies, 60 Cal. 341. In this case the statute having exempted cities, &c. from giving bond in civil actions, a bond in attachment proceedings given by a city was held void. Ante, secs. 89-92, and cases there cited; post, sec. 487, and cases cited. 2 Marsh v. Fulton County, 10 Wall. 676 (1870); ante, sec. 89; infra, sec. 457; Leavenworth v. Rankin, 2 Kan. 357 (1864); Wyandotte v. Zeitz, 21 Kan. 649; Horn v. Baltimore, 30 Md. 218 (1868); Bridgeport v. Housatonuc R. Co., 15 Conn. 475, 493; Haynes v. Covington, 13 Sm. & Mar. (21 Miss.) 408 (1850); Taft v. Pittsford, 28 Vt. 286 (1856); Montgomery City Council v. M. & W. P. R. Co., 31 Ala. 76 (1857); Pa., D. & M. Steam Nav. Co. v. Dandridge, 8 Gill & J. (Md.) 248, 319; Hodges v. Buffalo, 2 Denio (N. Y.), 110; Baltimore v. Eschbach, 18 Md. 276, 282 (1861); Baltimore v. Reynolds, 20 Md. 1; Dill v. Wareham, 7 Met. (Mass.) 438 (1844); Branham v. San Jose, 24 Cal. 585, 602; McCoy v. Brant, 53 Cal. 247, approving text; Sturtevant v. Alton, 3 McLean, 393 (1844); Wallace v. San Jose, 29 Cal. 180; State ♥. Mayor, 29 Md. 85, 111 (1868); Bateman v. Ashton, 3 Hurl. & Nor. 323; State v. Haskell, 20 Iowa, 276; Baltimore v. Musgrave, 48 Md. 472; People v. Baraga, 39 Mich. 554; Neely v. Yorkville, 10 S. C. 141, approving text; Bryan v. Page, 51 Tex. 532; Baby v. Baby, 5 Upper Can. Q. B. 510; Richmond v. Municipality, 8 Upper Can. Q. B. 567; Campbell v. Elma, 13 Upper Can. C. P. 296; Standly v. Perry, 23 Grant (U. C.), 507; Craycraft v. Selvage, 10 Bush (Ky.), 696 (1874) ; Treadway v. Schnauber, 1 Dak. Ter. 236; Ouachita P. J. v. Monroe, 37 La. An. 641; Laycock v. Baton Rouge, 35 La. An. 475; Keating v. Kansas, 84 Mo. 415. Within the scope of its power a corpora. tion may contract to do an act at any place other than the one where it is located. Bank of Utica v. Smedes, 3 Cow. (N. Y.) 662; Maddox v. Graham, 2 Met. (Ky.) 56. Or prospective in its terms. Davenport v. Hallowell, 10 Me. 317. As to corporate seal. Ante, sec. 190. Where a public corporation, transcending its legal power, assumes to direct its officers-for example, commissioners of highways to bring an action in their own names, or in their name of office, against third persons for trespasses upon the highways, and the action is accordingly brought and the officers are defeated, they cannot sustain an action against the corporation to be reimbursed their costs and expenses; and the reason is, that the action of a corporation directing such a suit to be brought, being in excess of its lawful power, is void, and cannot be the foundation of any contract, express or implied. Cornell v. Guilford, 1 Denio (N. Y.), 510; ante, sec. 147. corporations. So, also, those dealing with the agent of a municipal corporation are likewise bound to ascertain the nature and extent of his authority. This is certainly so in all cases where this authority is special and of record, or conferred by statute. The fact that in such a case the agent made false representations in relation to his authority and what he had already done, will not aid those who trusted to such representations, to establish a liability on the part of his corporate principal.1 - § 448. Scope of Power to Contract. Although it is true, as stated in the last section, that a contract made by a municipality in violation of an express legislative prohibition is void, yet, in the absence of special legislative restriction, the municipal authorities possess the same power as other debtors to make a new contract in any proper form, purging the former contract of its illegality. This principle is distinctly affirmed and well illustrated in a judgment by the Supreme Court of the United States. A city, in violation of local statutes forbidding the issue, circulation, or receipt of scrip or currency intended to circulate as money, issued such currency, engraved in the similitude of bank-paper, and by means 1 Baltimore v. Eschbach, 18 Md. 276, 282; Baltimore v. Reynolds, 20 Md. 1 (1862) Delafield v. State of Illinois, 2 Hill (N. Y.), 159, 174; 26 Wend. (N. Y.) 192 (1841); affirming s. c., 8 Paige, 531, restraining unauthorized sale of bonds. Hodges v. Buffalo, 2 Denio (N. Y.), 110; 3 Comst. 430; 2 Barb. 104; Supervisors, &c. v. Bates, 17 N. Y. 242 (1858). This case also determines how far, in such a case, the sureties of such an agent or officer are liable for his acts. And see cases cited Ib. p. 245. Chemung Canal Bank v. Chemung Co. Sup., 5 Denio, 517; Overseers, &c. of Norwich v. Overseers, &c. of Pharsalia, 15 N. Y. 341; Albany v. Cunliff, 2 Comst. 178, per Strong, J.; Marsh v. Fulton Co., 10 Wall. 676 (1870); Miners' Ditch Co. v. Zellerbach, 37 Cal. 543 (1869); Swift v. Williamsburg, 24 Barb. (N. Y.) 427; Hague v. Philadelphia, 48 Pa. St. 527; State v. Mayor, &c., 29 Md. 85, 111; Horn v. Baltimore, 30 Md. 218 (1868); Thomas v. Richmond, 12 Wall. 349 1870), per Bradley, J.; Ford v. Mayor, &c. of New York, 63 N. Y. 640 (1875); Stoneburgh v. Brighton, 5 Upper Can. L. J. 38; Belleview v. Hohn, 82 Ky. 1; Farnsworth v. Pawtucket, 13 R. I. 82. Special and limited authority to borrow money conferred upon the town treasurer, when exercised, is exhausted, and the town is not liable for money he subsequently borrows and converts to his own use, although he assumed to act, and was, by the lender, supposed to be acting under the authority conferred upon him. Savings Bank v. Winchester, 8 Allen (Mass.), 109 (1864); ante, sec. 117. So in Upper Canada it is held that an individual dealing with a corporation through its council or the members of the governing body, is bound to notice the objects and limits of their powers, and the manner in which those powers are to be exercised, since their acts, when beyond the scope of their authority or done in a manner unauthorized, are in general nugatory and not binding on the corporation. Ramsay et al. v. The Western District Council, 4 Upper Can. Q. B. 374; Silsby v. Dunville, 31 Upper Can. C. P. 301; Harr. Manual (5th ed.) p. 12; Mora wetz on Corp. (2d ed.) secs. 621, 718. thereof paid valid debts against itself; subsequently the holders of this illegal currency, at the instance of the city, surrendered the same, and received therefor new obligations of the city in the forms of bonds, to which there was no legal objection except that the consideration was illegal; it was held by the Supreme Court of the United States that the city was liable on the new bonds.1 § 449 (373). Mode of exercising the Power. Respecting the mode in which contracts by corporations should be made, it is important to observe that when, as is sometimes the case, the mode of contracting is specially and plainly prescribed and limited, that mode is exclusive and must be pursued, or the contract will not bind the corporation; 2 but the courts have sometimes regarded 1 Little Rock v. Merchants' National Bank, 98 U. S. 308 (1878); s. c. below, 5 Dillon, 299. The statement of the text as to the substance of the statutes of Arkansas in this regard is accurate. Mr. Justice Hunt supported the judgment of the Supreme Court of the United States by the following argument: "It can scarcely be doubted that whoever is capable of entering into an ordinary contract to obtain or receive the means with which to build houses or wharves or the like, may, as a general rule, bind himself by an admission of his obligation. The capacity to make contracts is at the basis of the liability. The first liability of the city was disputed by it. It had gone beyond its power, as it said, in making a debt in the form of bank-notes. If it had not denied its power, judgment and an execution might have gone against it, and the creditor would have obtained his money. This privilege of non-resistance every person retains, and continues to retain. He can reconsider at any time, and confess and admit what the moment before he denied. In 1874 the city of Little Rock did reconsider. It said, 'We will purge the transaction of its illegality. We had the authority to accept from you in satisfaction of amounts received by us for legitimate purposes the sums in question. We did so receive and expend for legitimate purposes. We erred in making the payment to you in an objectionable form. We now pay onr just and lawful debt by cancelling the bank notes issued by us, and delivering to you obligations in the form of bonds, to which form there is no legal objection."" See, also, Hitchcock v. Galveston, 96 U. S. 350; Nashville v. Ray, 19 Wall. 468; Police Jury v. Britton, 15 Wall. 570; Mullarky v. Cedar Falls, 19 Iowa, 24; Sykes v. Lafferry, 27 Ark. 407; Wright v. Hughes, 13 Ind. 113. See also the cases cited post, sec. 487, note. Where a city borrowed money of a bank upon its note at usurious interest, and the bank had subsequently cancelled the illegal note, had refunded the excessive interest, and received a new note for a lawful amount, the new note is valid. Miller v. Hull, 4 Denio (N. Y.), 104; Kent v. Walton, 7 Wend. (N. Y.) 256. So it has been held that where the consideration of a contract declared void by statute is morally good, a repeal of the statute will validate the contract. Washburn v. Franklin, 35 Barb. (N. Y.) 599; 13 Abb. P. R. 140, same case. Infra, sec. 487, note. People v. Weber, 89 Ill. 347; Bryan v. Page, 51 Tex. 532, approving text; Francis v. Troy, 74 N. Y. 338; State v. Passaic, 41 N. J. L. 90; Perrine v. Farr, 2 Zabr. (22 N. J. L.) 356; Carron v. Martin, 2 Dutch. (N. J.) 594; State v. Hudson, 5 Dutch. (N. J.) 104; State v. Marion County, 21 Kan. 419; Garvey, In re, 77 N. Y. 523; Smith v. Newburgh, 77 N. Y. 130; Allen v. Galveston, 51 Tex. 302; Dore v. Milwaukee, 42 Wis. 18; Butler v. Nevin, 88 Ill. 575; Kansas City v. Flanagan, 69 Mo. 22; Bentley v. County Comm'rs, 25 Minn. 259; Fulton v. Lincoln, provisions on this subject as directory. Thus, where the charter directed the mode in which moneys should be drawn from the treasury to be by an order of the council, signed by the mayor, such an order, issued upon a memorandum in the minutes of the corporation, without a formal order being entered, was adjudged a sufficient compliance with the charter. But unless the mode be prescribed and limited, valid contracts within the scope of the corporate powers may be made, as we shall see, otherwise than under seal or in writing. A contract with a municipal corporation, which by its terms is not to be performed within one year 9 Neb. 358; Hurford v. Omaha, 4 Neb. 350; Reis v. Graff, 51 Cal. 86; Addis v. Pittsburgh, 85 Pa. St. 379; McDonald v. Mayor, &c. of New York, 68 N. Y. 23 (1876); s. c. 23 Am. Rep. 144; Leavenworth v. Rankin, 2 Kan. 357; McCoy v. Brant, 53 Cal. 247, approving text; Murphy v. Louisville, 9 Bush (Ky.), 189 (1872); post, sec. 481, note; Montgomery County v. Barber, 45 Ala. 237; Terre Haute v. Lake, 43 Ind. 480; Head v. Prov. Ins. Co., 2 Cranch, 127 (1804). White v. New Orleans, 15 La. An. 667; infra, sec. 466; Dey v. Jersey City, 19 N. J. Eq. 412 (1869); Baltimore v. Reynolds, 20 Md. 1; Town of Durango v. Pennington, 8 Col. 257; Worthington v. Covington, 82 Ky. 265; Laycock v. Baton Rouge, 35 La. An. 475; North Pac. L. & M. Co. v. E. Portland, 14 Oreg. 3; Los Angeles Gas Co. v. Toberman, 61 Cal. 199. Speaking of this subject in a case above cited, Marshall, C. J., says: "The act of incorporation is to them an enabling act; it gives them all the power they possess ; it enables them to contract, and when it prescribes to them a mode of contracting, they must observe that mode, or the instrument no more creates a contract than if the body had never been incorporated." Approved, Bank of United States v. Dandridge, 12 Wheat. 64, 68 (1827); see, also, Angell & Ames Corp. sec. 253; Diggle v. Railway Co., 5 Exch. 442; Homersham v. Wolv., &c. Co., 4 Eng. Law & Eq. 426; Frend v. Dennett, 4 C. B. (N. s.) 576; Butler v. Charlestown, 7 Gray (Mass.), 12; Trustees v. Cherry, 8 Ohio St. 564 (1858); Bladen v. Philadelphia, 60 Pa. St. 464; McCracken v. San Francisco, 16 Cal. 591; Pimental v. San Francisco, 21 Cal. 351; Zottman v. San Francisco, 20 Cal. 96 Argenti v. San Francisco, 16 Cal. 255, 282, opinion of Field, C. J.; post, chapter on Taxation and Local Assessments. If a corporation sue upon a contract though it be executory on their part, and not executed, this amounts to a conclusive admission that the contract was duly entered into by them. Grant on Corp. 63; 5 Man. & G., 192. A contract by a city with a street railway company held not concluded, something remaining to be done. People's Pass. R. Co. v. Memphis City R. Co., 10 Wall. 38. Where a charter limits the exercise of power the mayor and council cannot, in a different mode, make a valid contract, nor can they, by any subsequent approval or conduct, impart validity to such contract, nor would the law imply any such contract: the law never implies an obligation to do that which it forbids the party to agree to do. Bryan v. Page, 51 Tex. 532; s. P. Francis v. Troy, 74 N. Y. 338. In the absence of proof of bad faith, or of a usurpation of authority, or that a public loss or private injustice will result from a contract made by a municipal council without complying strictly with charter provisions, the State will not be warranted in interfering to set it aside. Attorney-General v. Detroit, 55 Mich. 181. 1 Kelley v. Mayor, &c. of Brooklyn, 4 Hill (N. Y.), 263 (1843); see Neiffer v. Bank, 1 Head (Tenn.), 162; Pennington v. Taniere, 12 Q. B. 998, 1013; Maddox v. Graham, 2 Met. (Ky.) 56; ante, sec. 291. Under charter, executory contracts for grading, &c., must be in writing. Starkey v. Minneapolis, 19 Minn. 203 (1872). from the making thereof, is within the statute of frauds; but an entry in the official minutes of the corporation of a resolution passed by the governing body expressing the terms of the contract, signed by the clerk, constitutes a note or memorandum in writing sufficient to take the case out of the statute and to bind the corporation.1 § 450 (374). Seal not Necessary; How concluded. Modern decisions have established the law to be, that the contracts of municipal corporations need not be under seal unless the charter or other legislative enactment so requires.2 The authorized body of a municipal corporation may bind it by an ordinance, which in favor of private persons interested therein may, if so intended, operate as a contract; or they may bind it by a resolution, or by vote clothe its officers, agents, or committees, with power to act for it; and a contract made by persons thus appointed by the corporation, though by parol (unless it be one which the law requires to be in writing), will bind it.4 3 1 Argus Co. v. Albany, 55 N. Y. 495 (1874), Grover and Rapallo, JJ., dissenting. Municipal corporations may contract by parol through their duly authorized agents, and such contracts cannot be changed without the consent of the parties to be affected thereby. Duncombe v. The City of Fort Dodge, 38 Iowa, 281 (1874). 2 Draper v. Springport, 104 U. S. 501; Halbut v. Forrest City, 34 Ark. 246. A written proposal by a town to have work done, a written bid to do it and a written acceptance of the bid, held to constitute together a sufficient contract. Hoss, 114 Ind. 371 (1887). Wiles v. 3 The obligation of a contract, made by an ordinance, cannot be impaired by a subsequent ordinance, though it be authorized by a new city charter. Ante, sec. 314. So where the revenues of a market were, by ordinance, appropriated to pay municipal bonds, a later ordinance passed under a power granted by a new charter, diverting the revenues, was declared void. Fazende v. Houston, 34 Fed. Rep. 95. Ante, sec. 314, as to repeal; and chaps. iv. and vii., passim, as to extent of legislative power over Municipal Corporations. Fanning v. Gregoire, 16 How. (U. S.) 524 (1853); ante, sec. 192; Abbey v. Billups, 35 Miss. 618; Alton v. Mulledy, 21 Ill. 76 (1859); Western Sav. F. Soc. v. Philadelphia, 31 Pa. St. 175; lb. 185; Clark v. Washington, 12 Wheat. 40 (1827); Hamilton v. Newcastle & D. R. Co., 9 Ind. 359; Ross v. Madison, 1 Ind. 281 (1848); Bellmyer v. Marshalltown, 44 Iowa, 564 (1876); Chattanooga v. Geiler, 13 Lea, 611; where a contract is accepted unconditionally by the resolution of a city council the proceedings by which the resolution was adopted are presumed to be regular. Over v. Greenfield, 107 Ind. 231. Not essential that vote of directors appear on the record. Story Agency, sec. 52, where it is said that, "as the appointment of an agent of a corporation may not always be evidenced by written vote, it is now the settled doctrine at least in America that it may be inferred and implied from the adoption or recognition of the acts of the agent by the corporation." Post, sec. 459. And when this is the case an action of assumpsit lies against such corporation upon an express or implied promise. Post, sec. 459. Parol contract by council with city physician. Selma v. Mullen, 46 Ala. 411 (1871). See also, Broom Com. on Com. Law, 561570; Montgomery Co. v. Barber, 45 Ala. 237 (1877). In Fleckner v. United States Bank, 8 Wheat. (U. S.) 338, 357 (1823), it was |