This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
The power of a corporation to acquire personal property suitable for its business,1 such as supplies of material for manufacturing,2 or means of transportation for its materials and product,3 is so much broader than its power to acquire realty that it is rarely questioned. A corporation cannot, however, buy property suitable only for purposes outside the scope of the corporate business. Thus a bank cannot buy a manufacturing plant.4 So a corporation formed to manufacture and sell cotton-seed products, including fertilizer, cannot buy a different kind of fertilizer to resell at a profit,5 So a manufacturing or trading corporation cannot buy up claims against others as a speculation.6 It may buy up claims, however, as a means of carrying its own powers into execution. Thus a hardware company may buy up claims against its debtor for its own protection.7 So a corporation has implied power to purchase all the assets of a partnership, including an action for damages in tort.8
7 First, etc., Church v. Bank, 57 N. J. L. 27; 29 Atl. 320.
8 Little, etc., Co. v. Ry. Co., 194 Pa. St. 144; 75 Am. St. Rep. 690; 45 Atl. 66.
9 Fort Worth City Co. v. Bridge Co., 151 U. S. 294.
10 White v. Rice, 112 Mich. 403; 70 N. W. 1024.
1 Adams Mining Co. v. Senter, 26 Mich. 73.
2 National, etc., Bank's Appeal, 55 Conn. 469; 12 Atl. 646.
3 Callaway, etc., Co. v. Clark, 32 Mo. 305.
4 Harding v. Glucose Co., 182 111. 551; 74 Am. St. Rep. 189; 55 N. E. 577.
5 Richmond Guano Co. v. Oil Mill & Ginnery, 119 Fed. 709.
6 Farwell Co. v. Wolf, 96 Wis. 10; 65 Am. St. Rep. 22; 37 L. R. A. 138; 70 N. W. 289; 71 N. W. 109.
7 Mahoney v. Hardware Co., 19 Mont. 377; 48 Pac. 545; same case, 27 Mont. 463; 71 Pac. 674.