MacIntyre v. Massey

Hill, C. J. (After stating the foregoing facts.) The only question raised by the record is as to whether or not the plea 'as amended set out a good defense. Section 3188 of the Civil Code (1910) provides, that “after dissolution, a partner has no power to bind the firm £>y a new contract, or to revive one already for any cause extinct, nor to renew or continue an existing liability, nor change its dignity or its nature.” In the case of Preston v. Garrard, 120 Ga. 689 (48 S. E. 118, 102 Am. St. R. 124, 1 Ann. Cas. 724), it is held: “Where a partnership is dissolved by the retirement of one of the partners, and the continuing partner agrees to assume the debts of the firm, the retiring partner becomes a surety for his copartner.” “A creditor of the partnership, who has notice of the dissolution and of the agreement by the continuing partner to assume the debts, is bound thereafter to accord to the retiring partner all the rights of a surety. Hence, if, without his knowledge or consent, the creditor, upon a sufficient consideration, extends the time of payment of the firm indebtedness, the retiring partner is released from the indebtedness, and the creditor must thereafter look only to the firm assets and to the individual assets of the continuing partner.” Do the allegations of the plea as amended in the present case fall within the rule of law thus announced by the Supreme Court? There was no special demurrer filed to the allegations of the original plea or. the plea as amended, and, in the absence of such special demurrer, the general allegations contained in the plea and the amendments filed thereto must be .accepted as sufficient. These allegations, in substance, are that after the dissolution of the copartnership and the sale of its assets, the plaintiff, who was the payee and holder of the note sued upon, had continued the note, unto J. S. Montgomery Jr. or the Montgomery Drug Company, and had collected from'Montgomery payments of interest on the note in advance, and renewed and extended the time of payment of the note in consideration of the said payments, and that this was all done without the knowledge, authority, .acquiescence, or consent of the defendant MacIntyre. It seems to us that these allegations are sufficient to bring the case within the 461 principle of the decision above cited, as well as within the spirit of the code section cited. The receipt of interest in advance, and the extension of the time of payment of the note, in consideration of such advance, would, if this was done without the knowledge of the retiring partner, relieve him from further liability on the note, and would relegate the payee, for further payment, to the partnership assets and the partner to whom the extension had been granted. It is insisted by counsel representing the defendant in error that credits on the note, a copy of which is attached to the petition,, shows that only the interest due on the note had been paid on the due dates. The dates when the credits were apparently entered upon the note would not be conclusive on that subject, and the defendant MacIntyre would be entitled to show that, notwithstanding these dates, the interest was nevertheless advanced. And besides he alleged that the tim'e for payment of the principal of the note had been extended by the plaintiff to the continuing partner or to the successor of the partnership, without his knowledge or authority. If, on the trial, it appeared that the. only payments that had been made on the note were simply the interest, and that this interest had only been paid when due, and that there was no agreement for any extension of time on account of the payment of interest, the defense on this ground would fail. But these were questions of fact which were sufficiently put in issue by the plea, and should have been submitted to the jury; and we therefore think that the trial judge erred in striking the plea as amended. Judgment reversed.