Mehaffy v. Wilson

WOOD, J., (after stating the facts). The testimony was sufficient to prove a cause of action in favor of the appellant against Russell and the only question for our consideration is whether or not a partnership relation was created by the contract between Russell and the appellee. For if Russell and Wilson were partners then Wilson would be liable for the torts of,Russell committed by the latter as a partner in the course of the partnership business, whether Wilson had knowledge of such torts or not. McIlroy v. Adams, 32 Ark. 315; McClure v. Hill, 36 Ark. 268. But if the contract under review did not create the relation of partnership between Russell and Wilson then the latter would not be held liable for the torts of the former, because there is no testimony in the record, to warrant the conclusion that the appellee by his conduct had caused Pearl Mehaffy, the employee, to believe that Russell was the partner of appellee in the sawmill, in the operation of which Mehaffy was injured. In Haycock v. Williams, 54 Ark. 384, we held, quoting syllabus: “To establish a liability against a party as a partner for the acts of others, it must appear that a partnership was formed by express agreement, or that the party sought to be charged has been guilty of some act by which he is estopped from proving that he is not in fact a partner. ” See also Beecher v. Bush, 45 Mich. 188; Miller v. Simpson, 101 Va. 476, 59 S. E. 578, 18 L. R. Ann. (N. S.), 962, ease note subdiv. 6, p. 988. Recurring then to the question as to whether the contract created a partnership relation a careful analysis of it shows that it is lacking in many of the essential elements of such relation. In the recent case of Wilson v. Todhunter, 137 Ark. 80, we quoted from the Supreme Court of Missouri in the case of Distilling Co. v. Milson, 172 Mo. App. 612, as follows: “Mere participation in the profits and losses of a business, alone, would not necessarily make a participant a partner. Whether in fact a partnership exists depends upon the intention of the parties, to be discovered from the contract into which they enter, construed in the light of all the facts and circumstances that obtain.” See also Buford v. Lewis, 87 Ark. 416, where we said, “Whether a given agreement amounts to a partnership between the persons themselves is always a question of intention.” The contract is lengthy and it could serve no useful purpose to discuss its provisions in detail. After the preamble the first paragraph of the contract expressly provides that nothing contained therein is intended to create a partnership. While this language is not conclusive upon that issue yet if there is nothing in the subsequent language of the contract in conflict with such expressed intention, due force and effect should be given toil , i It is undoubtedly true, and many of the authorities so hold, that if the language of the contract when considered as a whole creates the partnership relation then it should be so construed, even though the parties expressly provide that such is not their intention. Fougner v. First National Bank, 141 Ill. 124; Loomis v. Marshall, 30 Am. Dec. 596, 30 N. E. 442; Flower v. Barnekoff, 20 Ore. 132, 11 L. R. A. 149, 30 Cyc. 360. See also Miller v. Simpson, supra, and Beecher v. Bush, supra, and many other cases cited in case note of Miller v. Simpson, supra. ■But here there is nothing in the subsequent language of the contract out of harmony with the expressed intention not to create a partnership. On the contrary, we are convinced that when all of the provisions of the contract are considered it can not be construed as creating a partnership relation between Bussell and Wilson. Where there is a joint enterprise and a division of the profits as such between the parties it is a cogent circumstance tending to prove the existence of a partnership, and, as to third parties, the presumption is conclusive unless proof is adduced to overcome it. See Buford v. Lewis, supra; Rector v. Robins; 74 Ark. 437; Johnson v. Rothschild, 63 Ark. 518. Now, there is nothing before us except the construction of the written contract. No presumptions are to be indulged, and the question as to the intention of the parties must he gathered solely from the language of the instrument taken as a whole. Wilson was the sole owner of the mill, and the machinery that caused the injury. There was no community of interest in the property existing at the time of the injury, no division of profits or losses as such. Wilson was not responsible for any losses and did not share in the profits as profits, but only was to receive a certain price for his timber and then compensation for his services and use of the mill, residences, etc., out of a certain proportion of the profits, if there were profits. These conditions would not make him a partner of Russell. Haycock v. Williams, supra. See also Lacotts v. Pike, 91 Ark. 20-28; Denny v. Cabot, 47 Mass. 82-90; 1 Rowley on Part., § 78. Our conclusion is that when the essential tests for determining partnership are applied to the contract under review, the trial court was correct in holding that it was not a partnership agreement. The judgment is, therefore, affirmed.