Tischler v. Kurtz Bros.

Mabry, C. J.: The general rule is, that one partner has no implied power to bind the firm by an instrument under seal. This court said in Jeffreys vs. Coleman, 20 Fla. 536,. that ‘‘the doctrine of the English common law was that — 328 — a bond signed by one partner in the course of partner ship business, without an authority under seal, binds only the partner who signs and seals it, although it is signed and sealed in the name of the firm. The old authorities assert that no prior authority or subsequent ratification, either verbal or by writing without seal, is sufficient to give validity to the instrument as the sealed contract of the parties. The American courts have strongly inclined to repudiate the doctrine in all cases where an express or implied authority or confirmation could be justly established, not under seal, whether it be verbal, or in writing, or circumstantial.” It was held that a bond given on suing out an attachment by a partnership firm, signed and sealed by one member in the firm name, the same having been ratified by parol, is a sufficient bond of all the partners. The authorities are numerous holding that validity and effect may be given to an instrument under seal, executed by one partner in the firm name in the scope of the partnership, by prior oral assent or subsequent parol ratification, or by implication of authority from acts or declarations of the other partners. 17 Am. and Eng. Ency. of Law, 1001, paragraph 5 and note. This court has, in the case referred to, sanctioned this view. On the uncontradicted evidence before us it is clear that the three-year lease of the premises therein described, though under seal, was binding upon the firm of Kurtz Bros. After the lease was executed in the firm name the leased premises were used for the purpose of conducting therein a wholesale and retail business by Kurtz Bros., and they continued to use and occupy’the premises for partnership purposes up to the time of the dissolution of the firm, some time in May, 1888. They do not deny that they went into possession of the premises under the lease and occu — 329 — pied them for the purposes and during the time mentioned. The act of Philip Kurtz in going into the possession of the premises under the lease and paying rent as therein provided, in the absence of any proof to the contrary, is sufficient to show that he ratified the acts of his partner in making the lease under seal. The uncontradicted testimony further shows that the rent provided for in the lease was not paid from the 15th day of August, 1888, to the 15th day of January, 1889. The affidavit of the defendants states that Benjamin Kurtz owed the plaintiff three hundred dollars, one hundred of which had been paid and attempted to be returned, and the entire amount had been tendered and refused before suit commenced. No effort was made, except on cross-examination of plaintiff, to show that any payment or any sufficient tender, was made of the rent for the time from the 15th of August, 1888, to January 15th, 1889, and the plaintiff expressly negatived any such payment or tender. Plaintiff testified that he was informed in May, 1888, by Philip Kurtz that he ivas going to leave Jacksonville, and go to New York, and would not come back to Jacksonville, and plaintiff expressed a hope that Kurtz would do well, and that it did not matter who paid the rent, so long as it ivas paid. Philip Kurtz testified that he retired from the firm of Kurtz Bros., in May, 1888, and put notice of the dissolution of the firm in the post office addressed to plaintiff, and he called plaintiff’s attention to the fact that he, Philip Kurtz, had retired from the firm, and that Benjamin Kurtz would pay the rent in the future. He further testified that plaintiff said it was all right, he did not care, so long as he got his rent. This testimony, and the further fact that Benjamin Kurtz gave plaintiff two checks, dated in June .and July, 188S, for rent, constitute the showing as to — 330 — the release of Philip Kurtz from, the payment of the-rent due under the lease. The suit was against Kurtz Bros., as partners, and the court charged the jury that if they believed from the evidence that the partnership was dissolved May 24th, 1888, and that plaintiff knew it, and released Philip Kurtz from the payment of the rent, then their verdict should be for the defendants. The court also-instructed the jury that as the defendants were sued as partners a verdict could not be found against one without finding against both, and that unless both of said defendants were liable for the claim of plaintiff, the verdict should be in favor of the defendants. It is evident that the verdict of the jury in favor of the defendants was based upon the view that plaintiff had released Philip Kurtz from the payment of rent under the lease. Under no other theory could the jury have failed to find a verdict for at least three hundred dollars in favor of plaintiff. The testimony is not sufficient, in our judgment, to authorize a finding that plaintiff released Philip Kurtz from payment of rent under the lease, and the court was in error in submitting the case co the jury on that theory. The dissolution of the firm alone did not, of course, have the effect to release either of the parties from antecedent firm liabilities. The statement of Tischler to PhilipKurtz (conceding that it was made) when informed of the dissolution of the firm, and that Benjamin Kurtz, would pay rent in the future, can not properly be construed into a release of Philip from paying rent under the lease. There was no consideration whatever for the-alleged release, and in fact the language used does not imply any release. The fact that Benjamin Kurtz paid rent after the dissolution does not change the nature of the obligation under the lease. The verdict of the — 331 — j ury in favor of the defendants on the evidence as to a release of Philip Kurtz is without legal support and can not be sustained. This conclusion is reached without reference to whether the rent reserved in the lease-under seal can be changed by parol. The judgment must be reversed and a new trial had, but as it is apparent from the testimony offered by defendants, tending to show that plaintiff agreed to reduce the rent fifty per cent, on certain accounts, that the question will again arise as to the right to do this, it becomes proper for us to express an opinion on this point. It is well settled, as a general rule, that a written contract not under seal may be varied by subsequent oral agreement based upon a sufficient consideration as to its terms to be performed in the future. Wheeler vs. Baker, 59 Iowa, 86, 12 N. W. Rep. 767; Hastings vs. Lovejoy, 140 Mass. 261, 2 N. E. Rep. 776; 1 Greenleaf on Evidence (15th ed.), secs 302, 303. There is a conflict in the American decisions as to whether a parol agreement reducing the rent is competent evidence to vary the terms of a lease under seal. In the case of Hastings vs. Lovejoy referred to, the Massachusetts court held that in an action for rent reserved in a written lease under seal the lessee could prove in defense that, after the delivery of the lease, the lessor for a good consideration orally agreed that for the future the rent should be reduced. It was said: “In reference to contracts under seal, it was formerly held, especially in England, that they could not b thus varied. But in the United States the tendency of judicial decisions has been to apply the same rule in this respect to sealed instruments as to simple contracts.” Considering the real virtue there is in the use of seals at the present day, the. view taken by the Massachusetts court has much weight. The legisla — 332 — tion of this State has not undertaken to change the legal effect of sealed instruments, and it is our duty under our system to keep in mind, in declaring the law, what is the common law rule so far as it has not been changed by statute or our peculiar institutions. Without going into a discussion of the cases on the subject, we are of the opinion that the prevailing view in America following the common law rule is that a covenant or contract under seal can not be modified before breach by a parol executory contract. Sinard vs. Patterson, 3 Blackford, 353; Carpenter vs. Shanklin, 7 Blackford, 308; Hume Bros. vs. Taylor & Moss, 63 Ill. 43; Eddy vs. Graves, 23 Wend. 82; Allen vs. Jaquish, 21 Wend. 628; Delacroix vs. Bulkley, 13 Wend. 71; Coe vs. Hobby, 72 N.Y 141, 28 Am. Rep. 120; Smith vs. Kerr, 33 Hun. 567. The New York courts held that the breach of a sealed contract, the parties to it may discharge any liability under it by entering into a new agreement in relation to the same subject-matter founded upon a sufficient consideration. We can not anticipate what the evidence will be on the next trial of this case, and do not desire to express .any opinion as to the effect of that now before us in reference to reducing the rent. So far as we are advised by the record, there was no purpose to show that the lease existing between the parties had been surrendered, but only a modification of its terms as to the amount of the rent, leaving the other terms and conditions in force. Whether a lease by simple contract or agreement under seal can be surrendered and a new contract substituted therefor is, of course, not involved in what is here said. The judgment is reversed and a new trial awarded.