Elkinton v. Booth

C. Allen, J. The defendants asked the court to rule that, if the plaintiffs never knew that the defendants were the responsible parties in the Spring Brook Mills Company, and if that company did not owe them anything at the time the defendants ceased to do business, then the plaintiffs were not entitled to actual notice of the dissolution of the firm consisting of the defendants. This request was properly refused. The two particulars mentioned, taken by themselves alone, were not sufficient and decisive to exonerate the defendants from the duty of giving notice to the plaintiffs. It was not necessary that the plaintiffs should have known the names of the defendants. They might, from their own experience and otherwise, have become satisfied that the Spring Brook Mills Company contained, and was managed by, persons, as members of the firm, who were men of means, as well as regular and prompt in paying all their debts, although they never had ascertained the names of such persons. The defendants did not contend that during their membership of the firm they were merely dormant partners. Their request for instructions implies the contrary. They carried on the business. The plaintiffs might well be content to continue to give credit to the firm, if they believed it remained as it had been; and it could not properly be ruled, as matter of law, that the defendants owed no duty of giving notice to the plaintiffs of their withdrawal from the firm, merely because the plaintiffs did not know that these individuals were the responsible parties in the firm. [482] Nor is the fact that the company did not owe anything to the plaintiffs at the time of the defendant’s withdrawal the test of their duty to give notice of such withdrawal. So narrow a rule as this might have the effect to defraud those who were giving credit to the company habitually and regularly, if nothing happened to be due on the particular day when the defendants withdrew. The instructions which are stated in the bill of exceptions have reference to the defendant’s request, and are limited to “ the question of notice,” that is, to the question of whether the facts assumed would exonerate the defendants from the duty of giving notice to the plaintiffs; and they are to the effect that the defendants were not so exonerated, if the plaintiffs had been dealing with the Spring Brook Mills Company, consisting of the defendants, and the company had paid its bills. This was sufficient, in respect to the matters to which the attention of the judge was called by the particular instructions which were asked. The instructions to the jury in other respects are not stated. Of course the plaintiffs could not recover without showing that they sold the goods to the Spring Brook Mills Company under the belief that the same persons who had formerly made that company worthy of credit still remained in it, and in reliance upon their responsibility. This was the ground of the decision in Rich v. Crandall, 142 Mass. 117, where it was said that it did not appear that the plaintiffs were misled by the defendant’s conduct or silence into believing him to be the real party in interest in conducting the business. See also Scarf v. Jardine, 7 App. Cas. 845, where it was held that the liability of a partner who has withdrawn is a liability by estoppel only. It does not appear that there was any omission to instruct the jury properly on this point; and, in the opinion of a majority of the court, the entry must be, Exceptions overruled.