Mix v. Shattuck

The opinion of the court was delivered by Royce, J. The first exception taken was to the admission of evidence offered by the plaintiff tending to show that the defendants at the time they executed the note declared upon, were co-partners, and that they treated the debt created by the note as a partnership debt, and that the money for which said note was [424] given was used as partnership funds. The evidence was not objectionable as varying the written contract, and, we think, was admissible for the purpose of showing the relation that the makers pf the note sustained to each other, and as affecting the rights of the payee of the note resulting from that relation, and the use made by the defendants of the funds which constituted the consideration for the note. The fact stated in the exceptions that the defendants in 1868 procured an act of incorporation, taken in connection with what the case finds was done by them under the charter, seems to be wholly immaterial upon the question of their liability. They carried on the same business as copartners under the corporate name that they, did before the act incorporating them under the firm name. They took all the property and effects of the old firm, and assumed all its debts, and the court was right in holding that the liability of the defendants was the same after organizing under their charter that it was before. The only remaining question is as to the effect of the payments made by the defendant Chesmore in preventing the running of the Statute of Limitations against the defendant Shattuck. The court made the operative effect of the payments for that purpose dependent upon the finding of the facts that the defendants were copartners at the time the note was signed by them, and that it was a partnership debt, and that the payments made by Chesmore were made out of the joint funds of the corporation. There has been a great diversity of judicial opinion upon the question of the legal effect of part payment by one partner after the dissolution of the partnership in preventing the running of the Statute of Limitations, or removing the statute bar when it has already run against the other partners. Ever since the case of Whitcomb v. Whiting, Doug. 652, in which it was decided that payment by one is payment for all, the one acting virtually as an agent for the rest, the courts of common law in England have held that payment by one partner after the dissolution of the partnership would prevent the running of the statute or, revive the debt against the other partners! The courts in some of the States have adopted the English rule, while others, upon reasons that are quite satisfactory to me, have held that such a payment had no such legal [425] effect. The Supreme Court in Joslyn v. Smith, 13 Vt. 353, and in Wheelock v. Doolittle, 18 Vt. 440, has decided that the English rule is the law upon the subject in this State; and in Carlton v. Ludlow Woolen Mill, 28 Vt. 504, it was held that a payment such as this appears to have been, is not within the provision of the statute which declares that payment made by one joint contractor shall not affect the liability of the others. Judgment affirmed.