272 F. 382 | 5th Cir. | 1921
Lead Opinion
This action was brought in a Louisiana state court by John R. Harrell, the defendant in error (herein referred to as the plaintiff), against Esteve Bros. & Co., described as “a firm composed of Ramon Esteve, Jose Esteve, Javier Esteve, Louis Esteve, and Angel Esteve, * * * engaged in the business of buying cotton and selling same for export,” and domiciled in the city of New Orleans. A deputy sheriff’s return shows that, on a date stated, he—
“served a copy of the within citation and accompanying petition on Esteve Bros. & Co., a firm composed of Ramon Esteve, Jose M. Esteve, Javier Esteve, Louis Esteve, and Angel Esteve, defendants herein, by leaving the same at their office, 819 Gravier street, in the hands of C. A. Hatry, manager and cash*383 ier, a person apparently over the age of 18 years, whose name and other facts connected with this service I learned by interrogating the said C. H. Hatry, manager and cashier; the said members of said firm, defendants herein, being absent from the state at the time of the service.”
On the application of the individuals composing the defendant firm, alleged to be aliens and nonresidents of Louisiana, who appeared in the state court specially and solely for the purpose of obtaining a removal, there was a removal of the cause to the court below. In that court the same individuals, appearing specially and solely for the purpose of the motion, moved the court to quash the service of process. After that motion was overruled, the same individuals, protesting against the overruling of the motion, appeared under protest and answered the declaration.
In behalf of the plaintiff in error it is contended that no jurisdiction was acquired by the service which was brought into question by the motion to quash. The opposing contention is that that service was made effective to confer jurisdiction by the Louisiana statute which provides that—
“In suits against any commercial association trading under a title or as a firm,” process shall be served “on any of the partners in person, or at, their store or counting house, by delivery to their clerk or agent.” Code of Practice of Louisiana, art. 198.
“The judgment was not a personal judgment against J. D. Sugg, but a judgment against E. O. Sugg individually, and against E. C. Sugg & Bro., treating the partnership as a distinct legal entity. So far as J. D. Sugg was concerned, it bound the firm assets only, and could not be proceeded on by execution against his individual property.”
We are not of opinion that the validity of service of process against a partnership which has the status of a distinct legal entity is dependent upon it being made on one or more of the partners. The artificial being recognized by law may, by agents or representatives other than
In many respects a trading partnership is like a business corporation. Each is an association of its members for pecuniary gain. A principal difference between them is that changes in the membership of the latter do not affect its identity nor break the continuity of its existence. In the one case as well as the other the law may recognize the existence of the association as an artificial being, separate and distinct from its members, capable of having rights and of being subject to duties or obligations, enforceable in favor of or against it in suits or proceedings to which its members are not parties. It is competent to provide for serving process against a private corporation by delivery to its agent at a place where it does business. We are aware of no legal obstacle standing in the way of service of process against a partnership, which is recognized as a separate legal entity, being authorized to be made in the same way. One not a member of a trading partnership, who is put and left in charge of its place of business, as well may be, so far as firm assets-'are concerned, a representative of nonresident partners as a resident partner could be.
Under the above set out statute, service in a suit against a commercial partnership, if made by delivery to a clerk or agent, must be “at their store or counting house.” The service in question was made in pursuance of the statute. The question of the validity of service of process against a partnership in a suit brought in a state in which it is not visibly present and doing business is not presented. We think the service made was effective to give the court jurisdiction to render judgment against the partnership, and that the overruling of the motion to quash was not error.
This was an action to recover compensation for services rendered by the plaintiff as an insurance broker in arranging for war risk insurance on cotton to be exported to Europe by the defendant. The larger of the two items claimed was based on so-called coverings for such insurance on cotton to be shipped from Galveston to Barcelona, Spain, on the ship Mar Rojo. Those engagements or coverings were made in October, 1918, at the rate of 3!/2 per cent.; one covering calling for November sailing, and the other for sailing prior to November 16th. Such arrangements do not bind either the insurer or the insured, if the sailing of the 'named vessel does not occur within the time specified. The Mar Rojo did not sail until December 3, 1918. Immediately after the signing of the Armistice on November 11, 1918, war risk insurance rates dropped to about one-eighth of 1 per cent. On November 30, 1918, after it had become apparent that the Mar Rojo would not sail in November, defendant notified the plaintiff that the war risk insurance previously arranged for was nullified, and requested plaintiff to procure the same amount of such insurance on the cotton at the then current rate.
Upon plaintiff failing to do so, the defendant obtained the desired insurande from other brokers. If the insurance arranged for in October had become effective, and been paid for as contemplated, the defendant would have been under no obligation to pay the plaintiff any-
“Ernest London: Eighteen your seventyseven Marojo still unreported impossible sail November thereby releasing except current rates brokerage promised. • John Harrell.”
That ruling is sought to be supported on the ground that the sending of that message tended to prove the making of an effort by the plaintiff to get the insurer to agree to a reduction of the rate of insurance fixed in October. The evidence had no such tendency. The language of the message shows that at the time it was sent it was known that the sailing of the Mar Rojo in November had become impossible. That fact put it out of the power of the plaintiff or his principal to hold the defendant to the rate made before the Armistice. The cable was not admissible as evidence of the making by the defendant of the promise alleged by the plaintiff. It was not competent to prove that fact by the defendant’s statement to a third person that such promise had been made. The court erred in overruling the objection. It may be supposed that the evidence of the plaintiff’s self-serving statement to the effect that brokerage was promised was not without influence in leading the jury to find that the defendant made the alleged promise.
Other questions raised are such as may not arise in another trial. Because of the above-mentioned errors, the judgment is reversed.
Concurrence Opinion
(concurring). In this case the writ of error is sued out alone by the partnership, and the error assigned is the service on it, by service on its agent. Under the law of Louisiana, in which the principal office of this partnership was located, and where the contracts here sued were made—
“the partnership once formed and put into action, becomes, in contemplation of law, a moral being, distinct from the persons who compose it. It is a civil person, which has its peculiar rights and attributes. * * * Hence, therefore, the partners are not the owners of the partnership property. The ideal being, thus recognized by a fiction of law, is the owner. * * * This distinction, between the partnership as an abstract ideal being and the persons who compose it, is illustrated by rules so familiar that it would be an unnecessary waste of time to argue in their defense.” Smith v. McMicken, 3 La. Ann. 319, 322.
This case has been frequently followed. Pittman & Barrow v. Robicheau, 14 La. Ann. 108; Succession of Pilcher, 39 La. Ann. 362, 1 South. 929. The law of Louisiana therefore recognizes the doctrine of the separate entity of a partnership in the fullest manner. 20 R. C. L. p. 804.
As the law of Louisiana regards a commercial partnership as a legal entity separate from the partners, it would seem that the law could provide for service of suits against such legal entity by service of process at its place of business on an agent of the abstract legal entity, the judgment based on such service to bind only the legal entity and operate as a lien on its property. Pennoyer v. Neff, 95 U. S. 714, 735, 24 L. Ed. 565