EXERCISE or CORPORATE POWER. 261 movement in the direction of enforcing unauthorized and prohib- ited contracts as between the parties. It is insisted, however, that Judge Thompson's "ancient doctrine" was not the starting point of this movement, and that the movement has not manifested itself as part of a development of the right to recover in quasi contract. It is a movement which has resulted from a new judicial conception of public policy, and from a more or less careful study of the needs of the business world. It is a movement of vast importance, and it is fraught with as much interest for the student as any tendency in modern legal development. The writer has ventured to suggest as a defect in Judge Thompson's work his failure to exhibit the operation of this more modern conception of public policy in con- trast with the older view which treated unauthorized contracts as illegal. This was the fourth point for discussion. A few thoughts derived from a study of this tendency may not be out of place. If this modern development is treated as being independent of moral considerations, and as being the result of the gradual substi- tution of a new theory of public policy for the old, a most interest- ing and important question presents itself. Is the interest of the community best subserved by adhering to the theory that a cor- poration is a legal person with limited powers, or by disregarding ihis theory in the determination to enforce all contracts, not im- moral, which have been in fact entered into between the parties t If the former view were to prevail, it would follow that contracts made in excess of corporate power or in defiance of statutory pro- hibition should receive judicial condemnation of a more or less severe character. They might be condemned as being wholly void, or as beinjj merely voidable. In either event, it might be held that their invalidity depended either upon the fact that such con- tracts are i oimoral, — contra bonos moresy — or that they are illegal merely, without any moral quality. If immoral, then (upon settled principles of law) no recovery could be had by either party from the other, even if the suit were brought m disaffirmance of the con- tract. If illegal, as being what is somewhat unscientifically called malum prohibitum merely, no action could be maintained upon the contract, but before the contract was wholly executed a recovery, with respect to benefits conferred, could be had by a plaintiff in default, and by a plaintiff against a defendant in default — except where the parties were in pari delicto. Thus, conceivably, three distinct developments might take place in pursuance of this funda- mental conception of public policy, (i) An unauthorized or pro-
