Adams v. Beall

Robinson, J., delivered the opinion of the Court. The appellee, while a minor, paid to the appellant twenty-nine hundred dollars, as a consideration for being admitted- as a partner in the appellant’s business. The partnership continued for more than a year, and finding it unprofitable, the appellee, without formally dissolving the partnership, withdrew from the business. The question in the case is whether the appellee is entitled to recover of the appellant the money thus paid? ^ His right to disaffirm the partnership contract, and to avoid all liabilities under it, including the partnership debts, is not denied. Being an infant when the contract *56 was made, this is a privilege to which, for his protection, he is entitled. But when he seeks to recover money paid for a consideration which he has enjoyed, or has had the benefit of, this presents quite another question. The $2900 was paid to, the appellant in consideration of being admitted as a partner in his business. He was admitted as a partner, and continued to be a member of ¡ the firm for at least a year. The business was not, it is / true, a successful one, but this, in the absence of fraudu i lent representations on the part of the appellant, cannot affect the question. We are dealing with a contract between an infant and an adult, executed on both sides, and upon the faith of which money was paid by the infant-for a consideration which he has enjoyed. The privilege of infancy, says Lord Mansfield, in Zouch vs. Parsons, 3 Burr., 1804, was intended as a shield or protection to the infant, and not to he used as the instrument of fraud and injustice to others; and to hold that an infant has the right, not only to withdraw from a partnership at his own pleasure, and to subject the adult partner to the payment of all the partnership debts, but has the right also to recover money paid by him as a consideration for being admitted into ihe partnership, would be, it seems to us, to extend the privilege beyond any just principles upon which it is founded. So long ago as Brawner and Wife vs. Franklin, et al., 4 Gill, 463, it was held that where an infant advances money upon a contract, he cannot disaffirm the contract and recover the money advanced, if he has enjoyed the consideration for which the money was paid. Holmes vs. Blogg, 8 Taunt., 508, is to the same effect. There the infant paid a sum of money as his share of the consideration for a lease of premises, in which he and his partner carried on the business of shoemaking. . They occupied the premises from March till June, when the infant dissolved the partnership, and brought an action to recover hack the *57 money he had paid the lessor for his lease. Gibbs, C. J. said, “ He may, it is true, avoid the lease; he may escape the burthen of the rent, and avoid the covenants; but that is all he can do. He cannot, by putting an end to the lease, recover back any consideration which he has paid for it; the law does not enable him to do that.” It is a mistake' to suppose, that the principle on which this case was decided, was either overruled or even questioned in Corpe vs. Overton, 10 Bing., 252. In the latter case, the plaintiff while an infant signed an agreement to enter into partnership with the defendant, and to pay him £1000 for a share in the business; and to execute on the first day of January a partnership deed with the usual covenants. He also paid £100, as a deposit for the fulfilment of his part of the contract. The plaintiff after-wards disaffirmed the partnership contract, and never did in fact become a partner. The suit was brought to recover of the defendant the £100 paid by the infant as a deposit. Tindal, C. J. said : The case was distinguishable from Holmes vs. Blogg. In that case the plaintiff and partner occupied the premises from March till June, and the money was paid for something available, that is, for three months enjoyment of the premises. “ In the present case, the plaintiff has paid to Overton £100, for which he has not received the slightest consideration. The money was paid, either with a view to a present or a future partnership. I understand it as having been paid with a view to a future partnership. Now the partnership was not to be entered into till January, 1833; and in the meanwhile the infant had derived no advantage whatever from the contract.” Bosanquet, J.: “We are far from impeaching the judgment of the Court in Holmes vs. Blogg, as applicable to the facts of that case. * * * * Here, the infant has derived no benefit whatever from the contract, the con *58 sideration of which has wholly failed. * * * The £100 paid here was in the nature of a deposit; money paid on a deposit may generally he recovered back where the contract goes off; and here the contract was defeated before the infant derived any benefit from it.” Audersou and G-aselee, Justices, were of the same opinion. The plaintiff was allowed to recover the deposit money paid by him while an infant, because the partnership contract was disaffirmed, by Corpe before the time agreed upon for it to begin! As was said by. Alderson, J., “ Before the contract is performed, one of the parties revokes it, and remits the other to the same situation as if the contract had never been made.” The distinction between Holmes vs. Blogg and Corpe vs. Overton is this: In the former the plaintiff was not allowed to recover the money paid by him while an infant, because it was paid on a consideration which he had in-part enjoyed; while in the latter, the plaintiff was allowed to recover as upon an entire failure of consideration. Passing then from these cases we come to Ex parte Taylor, 8 De Gex, Mac. & Gor., 254, which is a case directly in point. There an infant paid a premium on entering into a partnership, and before he came of age disaffirmed the contract, and upon the bankruptcy of the firm attempted to prove for the premium thus paid. Lord Justice Kni&ht Bruce said : “ In my opinion a case of fraud has not been established. That being so, the matter remains One of a contract fairly made, or as fairly made as a contract with an infant could be made, — a contract upon which the infant acted during his minority, and which during the minority has been in part performed on each side. In such a state of things I conceive that if the bankrupts had continued solvent, and an action had been brought against them by the minor, either before or after majority for the purpose of recovering the money in question or *59 any part of it, there must have heen either a non-suit or a verdict against him.” Lord Justice Turner said: “ It is clear that an infant cannot he absolutely hound hy a contract entered into during his minority. He must have a right upon his attaining his majority to elect whether he w'ill adopt the contract or not. It is, however, a different question whether, if an infant pays money on the footing of a contract, he can afterwards recover it hack. If an infant buys an article which is not a necessary, he cannot he compelled to pay for it, hut if he does pay for it during his minority he cannot on attaining his majority recover the money hack.” We have quoted at length from the preceding cases, because the question at issue is an important one, and comes before us for the first time for decision. And whilst fully recognizing the privilege which the law accords to minors in regard to contracts made during their minority, yet in a case like the present, where mone'v is paid hy a minor in consideration of being admitted as a partner in the business of the appellant, and he does become and remains a partner for a given time, he ought not to he allowed to recover back the money thus paid, unless he was induced to enter into the partnership by the fraudulent representations of the appellant. Whether an infant can avoid a contract and sue thereon during his minority, or must wait until he arrives at age, is a question about which the decisions are conflicting. To hold that he cannot disaffirm a voidable contract until he attains his majority, would in many cases work the greatest injustice to an infant. And where the contract is of a personal nature, or relating to personal property, we see no good reason why such a contract may not be avoided either before or after his majority. Stafford vs. Roof, 9 Cowen, 626; Shipman vs. Horton, 17 Conn., 481; Willis vs. Twambly, 13 Mass., 204. *60 (Decided 16th March, 1887.) The Court having erred in granting the plaintiff’s first and sixth prayers, the judgment must he reversed. Judgment reversed, and , new trial awarded.