Merrill v. O'Bryan

Hadley, C. J. This- is an action to recover the contract price of a quantity of lumber and a small amount of building paper. The amount sought to be recovered is $5,890. The action was brought by the vendor of the lumber against [416] Thomas O’Bryan, Edward M. Sullivan, and L. E. J. Davis, co-partners under the firm name of Dawson and White Horse Navigation Company. The defendant O’Bryan is the only member of the partnership who was served with summons or who appeared in the action. The contract of sale was made with the defendant Sullivan at St. Michaels, Alaska, in September, 1901, and the lumber was delivered into his charge at that time and place. He delivered to the plaintiff a draft on the Canadian Bank of Commerce for the payment of $5,-890, upon condition expressed in the draft that the lumber and paper, an invoice of which was attached to the draft, should arrive at Dawson, Yukon Territory, on or before November 1, 1901. The draft was signed: “Dawson & White Horse Nav. Co., per E. M. Sullivan, Manager.” It was presented to said bank about July 1, 1902, and payment was refused. Meantime the lumber did not arrive at Dawson before November 1, 1901, or at all, for the reason that Sullivan used it in the construction of a warehouse at St. Michaels. The defendant partners were the owners of steamers plying the Yukon river, and were at that time engaged in the transportation of freight up and down said river between Dawson and St. Michaels. The defendant O’Bryan, who appeared and defended, admits that Sullivan was a member of the partnership at the time he bought the lumber, but claims that as such partner he had no authority to purchase the lumber in behalf of the partnership, for the reason that the partnership was a non-trading one and existed for the purpose of carrying on a transportation business only. The court tried the cause without a jury and rendered a judgment in favor of the plaintiff for the full amount with interest against the partnership, enforcible against the joint property of the partners and against the separate or any property of the defendant O’Bryan. Defendant O’Bryan has appealed. The court found that the sale was made to the partnership through the defendant Sullivan, a member of the firm; that [417] it was agreed that, in the event the lumber was not transferred to Dawson on or before November 1, 1901, then payment for it should be made on July 1, 1902; that it was not transferred to Dawson for the reason before stated, and that the warehouse erected at St. Michaels by the use of the matei’ial was for the partnership, and to enable defendants to house and store such freight as might come into their possession at St. Michaels consigned to points up the Yukon river, and which should come into their possession after the closing of navigation by the ice. We think the findings are justified by the evidence. It is contended that the authority of Sullivan to bind the firm was not shown, in that it appeared that the partnership existed for a transportation business only, and that he was therefore not authorized to purchase lumber or other material for trading purposes. There was, however, no evidence to the effect that the purchase was made for trading purposes, and it was certainly within the scope of the partnership business to purchase lumber for some purposes. The partnership operated three steamers upon the Yukon river and handled a large amount of freight. The use of lumber for the construction of warehouses at terminal points or en route, for the housing of freight, or its use in the construction of barges, scows, or small boats, or in repairing the steamers, was certainly within the scope of the business of such a partnership, and this material was in fact used to construct a warehouse at a terminal point. Sullivan was at St. Michaels looking after the business of the partnership, and considering the nature and scope of the business as above stated he, as a partner, was a principal and had actual authority to purchase the lumber. He also had apparent authority to bind his partners. So far as third persons who deal with a partner without notice are concerned, the copartners are bound if the transaction be such as the public may reasonably conclude is directly and necessarily embraced within the partnership busi [418] ness as being incident or appropriate to such business according to the course and usage of conducting it. Heirn v. M’Caughan, 32 Miss. 17, 66 Am. Dec. 588; Pahlman v. Taylor, 75 Ill. 629; Todd v. Jackson, 75 Ind. 272; Seaman v. Ascherman, 57 Wis. 547, 15 N. W. 788; 22 Am. & Eng. Ency. Law (2d ed.), 141, 142. In the case of Alley v. Bowen-Merrill Co., 76 Ark. 4, 88 S. W. 838, 113 Am. St. 73, it was held that a partner in a nontrading partnership may effectually bind his partners by an act apparently within the scope of the partnership. Whether the act of a partner is within the scope of his authority is a question of fact to be determined by the court or jury trying the facts. Dowling v. Exchange Bank of Boston, 145 U. S. 512, 12 Sup. Ct. 928, 36 L. Ed. 795. The fact in this regard having been determined by the trial court against the partnership, and the evidence in the record being, as we believe, sufficient to sustain the finding, we shall not disturb it. It is insisted that the court erred in admitting in evidence the declaration of Sullivan to the effect that he would use, and did use, the lumber to build the warehouse. It is true the authority of an agent is not established by proof of his own declarations, but in this case the fact of the partnership and the general nature of its business were admitted, and the declarations of the partner that he did a specific act which act was clearly within the actual or apparent scope of the partnership business, was not a declaration as to his authority as an agent, but was the mere statement or admission of a fact concerning partnership transactions. As such the testimony was admissible against all the partners. 22 Am. & Eng. Ency. Law (2d ed.), 140; Griswold v. Haven, 25 N. Y. 595, 82 Am. Dec. 380; Coleman v. Pearce, 26 Minn. 123, 1 N. W. 846. Some contention is made that appellant was surprised by respondent’s evidence tending to show the necessity for build [419] ing the warehouse, and that the court erred in not granting the continuance at the trial for that reason. We think the point is not well taken. The trial was had in June, 1906, and appellant introduced in evidence the affidavit of Davis, one of the partners, which was, by consent, used as a deposition. The affidavit was subscribed in March, nearly three months before the trial, and it denied that the lumber was used to erect a warehouse by authority of the partnership. It is therefore manifest that appellant anticipated that the question of the necessity for the warehouse would arise at the trial, and he was not in position to claim such surprise upon that subject as justified a continuance. The judgment is affirmed. Fullerton, Rudkin, Crow, Mount, and Dunbar, JJ., concur.