Clark v. Rumsey

SPRING, J. It is unimportant to determine what the relations of the defendants are among themselves. The agreement was made to exploit for gas, and it was consummated, after notice to all the parties, by the election of officers, the designation of a company name, and the selection of a committee, who were to be the executive managers in the development of the enterprise foreshadowed in the chart, which all subscribed. The executive committee, thus pushed into existence with the approval and authority of the defendants, agreed with Sutton to drill the well a certain depth. Clearly, this committee possessed the power to make this agreement. The formation of the company, and the election of the committee, were made after notice to each defendant, so none can be heard to disown his offspring. The subsequent agreements were made with Sutton by the same committee for the prosecution of the same line of work which was the basis of the original agreement of the defendants among themselves. That some of the defendants failed to respond, or to attend meetings, or to assent to the continued prosecution of the work, constitutes no defense against Sutton, who was earning his money, relying upon their liability to pay him. The subscription agreement provided that all the subscribers to it were to be sharers in the profits in proportion to the respective sums subscribed, and that is sufficient to constitute them partners inter se. Clift v. Barrows, 108 N. Y. 187-193, 15 N. E. 327; In re Sheldon, 25 App. Div. 182, 49 N. Y. Supp. 377; King v. Barnes, 109 N. Y. 267-285, 16 N. E. 332; Wilcox v. Pratt, 125 N. Y. 688, 25 N. E. 1091. But in any event that agreement established a joint liability among its subscribers in favor of third persons who expended money or did labor fairly within its compass, and in reliance upon it. Colly. Partn. § 78 et seq.; Story, Partn. §§ 60-63; Manufacturing Co. v. Sears, 45 N. Y. 797; Haas v. Roat, 26 Hun, 632; Magovern v. Robertson, 116 N. Y. 61, 22 N. E. 398; Mason v. Partridge, 4 Hun, 621. It is no sort of con 418 sequence whether or not they were co-partners, in the strict sense of that relation. They joined together to drill for gas, and in the execution of that design they are liable jointly to third persons.