Lynch v. Thompson

Chalmers, J., delivered the opinion of the court. P. K. Peterson and. James H. Lynch entered into a written agreement by which they contracted to embark together in the enterprise, business, or adventure of raising and dismantling a large steamer which lay sunken off the Gulf coast of this State near Scranton. Lynch was to furnish certain necessary machinery and appliances named, and with these Peterson was to do the work, furnishing labor, provisions, money, and such further appliances as were necessary for the work. As fast as the wreck was dismantled, the material saved was to be turned over to Lynch, who was to control and sell the same for joint account, first repaying to Peterson the [358] amounts paid out by him. This agreement constituted the parties partners in this enterprise or adventure both inter sese and as to third persons. The attempt to dismantle the vessel was entered upon and persisted in for some time but ultimately abandoned. Plaintiff Thompson, who was a merchant in the town of Scranton, sold and delivered to Peterson many things essential to the enterprise, which by Peterson’s directions were charged to Peterson & Lynch. Lynch, knew that these articles were being bought, that they were being used in the joint business, and that they consisted of the very things the purchase of which it was contemplated by the articles of agreement Peterson should furnish, but did not know that they were being bought on the joint credit of the two partners or of the firm, and supposed that they were sold on the credit of Peterson alone. Being sued jointly with Peterson for their price, he resists liability upon the ground that he and Peterson were not general traders nor partners of any sort, but simply adventurers embarked in a single enterprise, and that, therefore, all who dealt with them were bound to inquire into and to take notice of their private agreement, •and could impose no liability upon either except as contemplated by its articles. The court below rightly rejected this view. Partners in a single venture are like other partners, liable for all contracts entered into by either for the promotion of the scheme within the scope of the venture where it can be affirmatively shown that such was the nature of the contract. The scope of the power to make contracts will be broader or narrower according to the business and the usually recognized methods.of conducting it. It is generally held that in non-trading partnerships there is no power in one partner to execute promissory notes or other negotiable paper, and this has been several times held in this State as applicable to farming partnerships, the reason being that such partnerships do not ordinarily contemplate the borrowing of money. Davis v. Richardson, 45 Miss. 499; Cooper v. Frierson, 48 Miss. 300; Prince v. Crawford, 50 Miss. 344; Morgan v. Pierce, 59 Miss. 210. But no matter what the business nor how the contract is evi [359] deuced, the act of one partner will bind the rest where the plaintiff affirmatively shows that the real consideration was within the scope of the business as generally understood and conducted in the country, or was actually essential to the promotion of the enterprise; nor will this liability as to third persons be affected by the private agreement inter sese, that a particular member of the firm shall alone be liable for such matters. When the contract has taken the form of negotiable paper it loses its strictly negotiable character, as to which the authorities show a great jealousy in non-commercial partnerships; but this would be a matter of little concern under our anti-commercial statutes as to such paper. In other words, partners in a single undertaking are, like other partners, bound for the acts of each other done in the conduct of the business, the only difference being that in commercial partnerships third persons are protected by some presumptions of law which do not attach in non-trading enterprises. In the present case, however, no presumptions are necessary, since it affirmatively appears that the articles furnished were essential to the enterprise, as evidenced both by its nature and by the articles of agreement between the partners. The articles sued for were labor done and provisions and materials supplied in carrying on the work. Collyer on Part., § 402 and notes; Lindley on Part. 55-6 and notes; Story on Part. 126 and notes. The instructions given and .refused in the court certainly did' appellant no injustice, though they were not perhaps all that the appellee had a right to demand. It is objected that there was a trial of the issues joined between the plaintiff and defendant Lynch without any previous judgment or dismissal as to defendant Peterson, who had made default. There was a subsequent judgment by default as to Peterson, and though it would have been more orderly to have made some previous disposition as to him, it is not perceived how any wrong or injustice accrued to Lynch by the order adopted. The verdict and judgment against Lynch was for two hundred and fifty-seven dollars, and the judgment by default against Peterson was for two hundred and twenty-five dollars, and this, it is insisted, [360] makes both judgments erroneous. The judgment against Peterson is undoubtedly erroneous. The suit was against both defendants as partners, and they must both, therefore, be liable for the same amount. While §§ 1732-1733 of Code of 1880 permit judgments for different amounts to be entered in the same suit against different defendants as justice may demand, this will not justify as to Peterson the judgment here entered, since such judgment must be based upon the idea that he owed something more than the amount due by the firm, because of an individual liability on his part. But it is not permissible to embrace in the same suit an individual demand against one partner and a joint demand against the firm of which he is a member. Miller v. Northern Bank, 34 Miss. 412. There is no error, however, in the judgment against Lynch for • the smaller sum. This was wholly upon a demand against the firm, for which he was liable. Peterson has not appealed and Lynch cannot complain of an error by which he is in no manner aggrieved. The same answer applies to various assignments of error by which appellant Lynch attacks the validity of the proceedings against Peterson. Affirmed.