Alley v. Bowen-Merrill Co.

Wood, J., (after stating the facts.) Two questions are presented: First, is J. I. Alley, the appellant, liable on the contract made by Glitsch, his law partner, without his knowledge or consent ? Second, can the Bowen-Merrill Company bring this suit and maintain it in this State, it being an Ohio corporation, withóut filing here its articles of incorporation and appointing an agent ? 1. Upon the first question the trial court declared the law as follows over defendant’s objection, which was declaration No. 4: “In a partnership for the practice of law the act of one partner in the scope of business of said firm is the act of all, and every responsibility incident to other partnerships in general attaches to legal partnerships, as well as corresponding rights.” Upon this point the defendant asked the following declarations, which were refused: “ (1). That a firm of lawyers is a non-trading partnership, and one member of the firm cannot bind the other without express authority from the other.” “(2). It is necessary in this case for the plaintiff to prove that Henry Glitsch had the right to contract for books in the firm name.” “(3). It is the duty of persons or firms doing business with a non-trading partnership to know if one member is authorized to bind the other on contracts and commercial paper.” . “(5). That a firm of lawyers is a non-trading partnership, and that one partner cannot bind the other, either on commercial paper or on contracts, although the proceeds were used in the business, without express authority from.the other partner.” The court correctly declared the law that the act of one partner in a firm of lawyers in the scope of its business is the act of all. It is generally held that non-trading firms have no power to borrow money and sign negotiable paper, and that one member of such firm has no power to bind the other members by signing the firm name to such paper. Worster v. Forbush, 171 Mass. 423; Smith v. Sloan, 37 Wis. 285; 22 Am. & Eng. Enc. Law, p. 154, note (Lawyers). This is because such transactions are not generally within the legitimate scope of the business of such firms. There is no reason why such firms should not be bound by the acts of their members within the scope of their business. This would be true even in the case of negotiable pager, where it was shown that such paper was executed within the scope of the firm’s business. 1 Bates, Part. § 343. Mr. Bates, after an exhaustive review'of the authorities on the powers and liabilities of non-trading partnerships, says: “Each partnership must stand largely on the nature of its peculiar business, and no rule of universal application is possible.” This is the correct doctrine, and there is no reason why a firm of lawyers should not be bound by the act of one of its members in buying such law books as may be reasonably necessary for carrying on the business. Such an act is certainly within the scope of the business of such a partnership. It is impossible to practice law successfully in these times without some law books. As Mr. Bates says: “It is difficult to conceive of a partnership which does not require some purchases to be made in the usual course of its business.” In non-trading firms this is certainly necessary. He instances the case of lawyers purchasing their law books. Miller v. Hines, 15 Ga. 197. See also Crosthwait v. Ross, 1 Humph. 23. The purchase of law books reasonably necessary in the business is a responsibilty and liability incident to a partnership for the -practice of law. And when lawyers come together for that business, they are presumed to repose in one another the trust and confidence necessary to attend to the duty of purchasing law books for the firm, and to clothe each with authority to bind the other. 2. “The institution and prosecution of an action is not doing business within the meaning of the act February 16, 1899, and other statutes upon the subject.” Buffalo Zinc & Copper Co. v. Crump, 70 Ark. 525; Railway Company v. Fire Association, 55 Ark. 174. Affirm.