Walsh v. Lennon

Mr. Chief Justice Dickey delivered the opinion of the Court: This is an action of assumpsit, brought by Lennon, against Robert Walsh and Thomas Walsh, as partners, doing business under the firm name of “Walsh Bros.,” upon an instrument in writing, dated Joliet, 111., May 27, 1875, and purporting, on its face, to be signed and sealed by Walsh Bros, and by Thomas Walsh, by which they promised, jointly and severally, for value received, to pay to the order of Lennon ¡§980, one day after date, with interest at ten per cent per annum after due, in which instrument it Avas recited that the same Avas given for money loaned. The instrument also contained a power of attorney authorizing'a judgment by confession to be entered at any time for the amount, then due thereon. Defendants were served with process. Thomas Walsh suffered judgment by default. Robert Walsh made defence, upon the sole ground that he did not seal the instrument in question. The declaration contained special counts upon the instrument, and also the common money counts. On the trial, it was proven that Thomas Walsh and Robert Walsh were partners, doing business as dealers in dry goods, under the firm name, “Walsh Bros.,” and that .Thomas Walsh signed the firm name to the writing in question. It is authenticated thus: “ Witness our hands and seals. Walsh Beos. [seal.] Thomas Walsh, [seal.] • [seal.] ” The plaintiff recoArered, and Robert Walsh appeals to this court. It is insisted that the instrument, being a sealed instrument, is not such an instrument as one partner may execute for another. It is Avell settled that the power of a partner does not enable him, merely as such, to bind the other members of the firm by deed. It is, however, among the powers of a partner in such business, to borroAv money in the name of the firm, and thus render His partners liable for the sum borrowed; and to bind the firm by an agreement to pay interest on the same at any lawful rate; and to sign the firm name to any writing admitting the fact of the borrowing, and promising to pay, and thereby to furnish evidence against the firm and each of its members. All this Thomas Walsh did do, and thereby, (as a majority of the court think), did bind the firm and each of its members. He also added a seal to the signature. This he had no authority to do, in behalf of his firm or of his partner. This seal added nothing to the force and effect of the writing to which the firm name was signed, and a majority of the court are of opinion that the addition of a seal to the firm name did not impair or vitiate the written acknowledgment of the firm, and the written promise of the firm contained in the paper, and sanctioned by the firm name placed thereby one of the partners. It is undoubtedly true, that one partner has no power to bind the firm by deed,—but this instrument is not sued upon as a deed. The declaration contains the common counts. The proof shows defendants were partners, and that the writing in question has the firm name attached thereto by one of the partners. This partner had the right to borrow money on the credit of the firm and give the promise of the firm for its payment. A seal is not necessary to render such a promise effective. The writing, without reference to its effect as an obligation, contains a written admission that the money was borrowed by the firm at the agreed rate of interest mentioned. Had the partner written a letter to a third party and stated these facts in the letter, can any one doubt that such a letter, signed by one of the partners, would be competent evidence to prove these facts ? And can it be contended that the adding of a seal to the letter would have impaired the force of such evidence? Purviance v. Sutherland, 2 Ohio St. 478. The giving of a note for a debt, whether sealed or unsealed, does not pay or discharge the debt, unless it be agreed that it shall be accepted as payment and satisfaction, and assumpsit may be maintained for the debt, if the note be produced on the trial to be cancelled. One partner, acting for the firm, may, in its name, appoint an agent and authorize him to bind the firm by his contracts, made in the name of the firm by him, as such agent. Such authority may be given in writing, and such writing need not be under seal; and if a seal be added it will not vitiate the effect of the writing. Lucas v. Bank, 2 Stewart (Ala.) 297. There are many respectable authorities to the position, that while one partner can not bind his co-partners by deed, yet, if the instrument used in commercial transactions be valid and effective without a seal, and within the power of a partner, the attempt to seal the same in behalf of the firm will not vitiate its legal effect as an unsealed instrument. See Parsons on Part. (2d ed.) p. 191, note m, and Price v. Alexander, 2 Greene (Ia.) 427; Lawrence v. Taylor, 5 Hill, 107; Sweetzer v. Mead, 5 Mich. 107; Tapley v. Butterfield, 1 Metc. 575; Gibson v. Warden, 14 Wall. 247; and authorities collated in Am. Law Peg. vol. 9, N. S. pp. 271—2. Whatever maybe the true rule on this question, a majority óf the court are clear that the plaintiff had a right to recover under the common counts, by bringing in the paper to be cancelled. The proof shows the partnership, from which springs the power of one partner to borrow money for the firm, and to promise, in behalf of the firm, to pay the principal at a' given time, and the interest at any given, lawful rate. The writing, proved to have been signed by one of the firm, without reference to its effect as an obligation, contains an admission made by one of the partners, that the money was borrowed by the firm at the rate of interest mentioned. The judgment must be affirmed. Judgment affirmed.