SMITH
v.
SHEELEY
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Mitchell granted Redick a power of attorney to sell property that Mitchell then held only possessory rights to, and Redick subsequently conveyed the property to a bank after Mitchell acquired legal title; the Supreme Court held that Mitchell was estopped from disavowing Redick's authority based on the subsequent acquisition of legal title and that the bank, though lacking proper congressional approval of its charter, was a competent grantee as a de facto corporation whose capacity could not be questioned collaterally by the grantor after payment of consideration.
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Mr. Justice DAVIS delivered the opinion of the court.
‘ It is insisted, in behalf of the plaintiff'in error, that Redick had no authority to make this deed in Mitchell’s name, because the power under which he acted directed him to convey such title as Mitchell then had, which was only a possessory right. It is true that in February, 1857, when the power of attorney was given, Mitchell had not the legal title to the lot, but as the mayor of Omaha conveyed it to him a short time afterwards, it is a fair presumption that he was, at the date of the execution of the power, one of the class of persons who were entitled to a deed from the mayor under the provisions of the Town Site Act of 1844. If so, he was to all practical purposes the real owner of the property, and intended that Redick should sell and convey something more than a “ mere uncertain and shadowy right,” as the plaintiff in error claims.
But, in the state of the pi’oof it is not necessary to look into the power of attorney to see the extent of the authority conferred, because the subsequent conduct of Mitchell renders it an unimportant subject of inquiry. It would be grossly unjust for Mitchell, having acquired the legal title, to let Redick, under a power of attorney executed before the title was obtained, make a deed in his name to the bunk, appropriate to himself the money received for the sale of the property, and then, six years afterwards, disavow the act of his attorney on the plea that he had exceeded his authority. The law will not permit this to be done, and estops Mitchell from setting up-such a claim.
It is insisted, however, as an additional ground of objection 'to this deed, that the bank was not a competent grantee to receive title. It is not denied that the bank was duly organized in pursuance'of the provisions of ah act of the legislature of the Territory of Nebraska, but, it is said it bad no right to transact business until the charter creating it was approved by Congress. This is so, and it could not legally exercise its powers until this approval was obtained, but this defect in its constitution cannot be taken advantage of collaterally. No proposition is more thoroughly settled than this, and it is unnecessary to refer to authorities to support it. Conceding the bank to be guilty of usurpation, it was still a body corporate de facto, exercising at least one of the franchises which the legislature attempted to confer upon it, and in such a case the party who makes a sale of real estate to it, is not in a position to question its capacity to take the title, after it has. paid the consideration for the purchase. If, prior to the execution of the deed, there had been a judgment of ouster against the corporation at the instance of the government, the aspect of the case would be different.
There is no error in.the record, and the-judgment is
Affirmed.
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Brant v. Coal, 93 U.S. 326 (U.S. 1876)
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Jones v. Habersham, 107 U.S. 174 (U.S. 1882)…charter of a corporation upon the amount of property that it may hold cannot be taken advantage of collaterally by private persons, but only in a direct proceeding by the State which created it. Runyan v. Coster, 14 Pet. 122, 131; Smith v. Sheeley, 12 Wall. 358, 361; Bogardus v. Trinity Church, 4 Sandf. (N. Y.) Ch. 633, 758; De Camp v. Dobbins, 29 N. J. Eq. 36 ; Davis v. Old Colony Railroad Co., 131 Mass. 258, 273. 2d. By an act of amendment of the 28th of October, 1870, the provisos in the first section…
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Fritts v. Palmer, 132 U.S. 282 (U.S. 1889)…uch advances from the prohibitory provisions of the statute, the objection can only be urged by the government.” To the same effect are Swope v. Leffingwell, 105 U. S. 3, and Reynolds v. Crawfordsville Bank, 112 U. S. 405, 412. In Smith v. Shelley, 12 Wall. 358, 361, which was an action of ejectment, the question was collaterally raised as to the validity of the title acquired by a banking institution, under a deed of the premises, in consideration of a.certain sum paid by it to the grantor. The bank was c…
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