If a contract is made with a known agent acting within tbe scope of bis authority for a disclosed principal, tbe contract is that of tbe principal alone, unless credit has been given expressly and exclusively to tbe agent, and it appears that it was clearly bis intention to assume tbe obligation as a personal liability and that be has been informed that credit has been extended to him alone. 2 Amer. Jur., page 247, and numerous authorities cited in note. Way v. Ramsey, 192 N. C., 549, 135 S. E., 454.
Tbe presumption is that where one known to be an agent deals or contracts within tbe scope of bis authority, credit is extended to tbe principal alone and tbe act or contract is bis engagement as if be were personally present and acting or contracting. 2 Amer. Jur., page 247. There is no implied warranty by an agent that bis principal has authority to make a contract signed by tbe agent; and tbe agent, acting within tbe scope of bis authority, is not answerable upon such a contract where bis principal is not bound by it merely because be bad no authority to enter into tbe particular contract. Ellis v. Stone, L. R. A., 1916 F, 1228. Upon like principle, tbe American Law Institute has advanced tbe general rule that an agent making a contract for a disclosed principal whose contracts are voidable because of lack of full capacity to contract, or for a principal who, although having capacity to contract generally, is incompetent to enter into tbe particular transaction, is not thereby liable to tbe other party by reason of tbe failure of tbe principal to perform, unless be contracts or represents that tbe principal has capacity *248or unless be bas reason to know of tbe principal’s lack of capacity and of tbe other party’s ignorance thereof. 2 Amer. Jur., 249; Restatement, Agency, sec. 332.
Tbe plaintiff dealt with tbe individual defendants as a committee representing tbe corporate defendant. Tbe committee acted within tbe scope of tbe authority vested in them by tbe board of aldermen and no credit was extended to them as individuals. Furthermore, tbe contract purports to impose liability only on tbe city of Henderson. In no event, on tbe facts appearing on this record, is tbe plaintiff entitled to recover of tbe individual defendants. The judgment dismissing tbe action as to them is sustained.
In repairing and grading its streets a city acts in a governmental capacity and is not liable for resulting damages to abutting property. This question was first considered by this Court in 1848 and exhaustively discussed by Judge Pearson, who reached tbe conclusion that where a municipal corporation bas authority to grade its streets it is not liable for consequential damages unless tbe work was done in an unskillful and incautious manner. Meares v. Wilmington, 31 N. C., 73. This ease bas been approved and consistently followed in many adjudications of this Court since that date. Dorsey v. Henderson, 148 N. C., 423, and cases there cited. Calhoun v. Highway Commission, 208 N. C., 424. In Thomason v. R. R., 142 N. C., 307, it is stated that this is “tbe settled doctrine of tbe State.” It is almost universally so held by tbe state courts in this country, as well as tbe courts of tbe United States and of England. 2 Dillon on Municipal Corp., sec. 1040; Pollock on Torts (7th Ed.), 128; 10 Am. and Eng. Enc. of Law (2nd Ed.), 1124 FF. Transport Co. v. Chicago, 99 U. S., 635; Smith v. Washington, 20 Howard, 135; Cooley on Const. Lim., 542, and notes; Manufacturers v. Meredith, 4 Durn. and East Term, 794-796; Sutton v. Clark, 6 Taun., 28; Bolton v. Crowther, 2 Barn, and Cres., 703.
If a contract is ultra vires it is wholly void and (1) no recovery can be bad against tbe municipality; (2) there can be no ratification except by tbe Legislature; (3) tbe municipality cannot be estopped to deny tbe validity of tbe contract. 3 McQuillin, Municipal Corporations, 2nd Ed., page 817. “A contract of a corporation which is ultra vires, in tbe proper sense, that is to say, outside tbe object of its creation as defined in tbe law of its organization, and therefore, beyond tbe powers conferred upon it by tbe Legislature, is not voidable only, but wholly void, and of no legal effect. The objection to the contract is, not merely that the corporation ought not to have made it; but that it could not make it. The contract cannot be ratified by either party, because it could not have been authorized by either. No performance on either side can give the unlawful contract any validity, or be the foundation of any right of *249action upon it.” Central Transp. Co. v. Pullman Palace Car Co., 139 U. S., 24, 35 L. Ed., 55; Realty Co. v. Charlotte, 198 N. C., 564.
A city is not estopped from pleading ultra vires in defense of an action on contract by the fact that the other party to the contract expended money to perform his part of the agreement. Mealy v. Hagerstown, 92 Md., 741, 48 Atl., 746. The fact that the other party to the contract has fully performed his part of the contract, or has expended money on the faith thereof, will not preclude the city from pleading ultra vires. Dawson v. Dawson Waterworks, 106 Ga., 696, 32 S. E., 907; Mealy v. Hagerstown, supra. No subsequent action on the part of the municipal corporation will prevent it from denying the validity of such contract. State ex rel. v. Murphy, 134 Mo., 548, 56 Am. State Reports, 515, 34 L. R. A., 369; Realty Co. v. Charlotte, supra.
There is no allegation in the complaint that in grading Williams Street the city took any part of plaintiff’s property or imposed any additional burden thereon. Jt clearly appears, that the consideration for the contract was the apprehended damages resulting from the lowering of the grade of said street where the plaintiff’s property abutted thereon.
Conceding that if the city took the property of the plaintiff it could pay just compensation therefor in money or by the services contemplated by the contract, this would not avail the plaintiff here. Such damages as the plaintiff sustained, and such as were within the contemplation of the parties at the time the contract was made, resulted from the lowering of the grade of Williams Street. This constitutes no valid consideration for the contract and the city authorities were without lawful authority to make the contract sued upon or to expend public funds therefor. A municipal corporation cannot assume a liability where none exists and the defendant’s act in entering into the contract sued upon was ultra vires. The corporate defendant is not liable for any damages resulting from the breach thereof. It follows that the city of Henderson likewise was entitled to a judgment of dismissal on its motion to nonsuit.
Affirmed.