17 F. 726 | U.S. Cir. Ct. | 1882
This is an action on a contract to enter into a partnership, which the defendants are alleged to have refused to carry
This action is by Goldsmith against the two Sachs and the two Hellers. Neither Isam White nor Levi White is joined as plaintiff or defendant. He alleges special several damages resulting to him alone from the breach. It is claimed by the defendants that this action cannot be maintained if the parties L. and I. White are not joined. The only terms of the contract indicating its character, whether joint or several, are, “they have agreed to become partners.” That is the language of the contract.- The contract, therefore, is not in express terms either joint or several.
In the case of Capen v. Barrows, 1 Gray, 376, the court citing Broom on Parties, 8 and 10, these rules are laid down:
'Where the covenant is, in its terms, several, but the interest of the covenantees is joint, they must join in suing upon the covenant; (2) where the covenant is, in its teyms, expressly and positively joint, the covenantees must join in an action upon the covenant, although as between themselves their interest is several; (3) where the language of the covenant is capable of being so construed, it shall be taken to be joint or several according to the interest of the covenantees.
The last is the category in which this contract falls. The terms are expressly neither joint nor several; so the parties, according to that rule, may consider it as either joint or several, according to their interest and the nature of the cause of action. Certainly each party has an interest in having each and all of the other parties go on with the partnership and carry out the agreement. Each has a several interest in carrying out that partnership arrangement. He cannot sue them all, at law, because some of them have committed no breach. There is no cause of action against them. He cannot join them all as plaintiffs, because all are not injured, or have not all sustained the same injury.
The injury complained of is not joint. It affects no one but the plaintiff. If a recovery is had for the damages alleged, the partnership assets are neither increased nor diminished. The plaintiff does not contribute to pay his own judgment, nor do any of the others share in the judgment. He could not join as party plaintiff those who are guilty of the breach, and liable for the damages, because the damages are several and his own, and not theirs. The parties sued cannot be both plaintiffs and defendants; and unless he can sue those alone who committed the breach and are liable, there is no remedy whatever. There would be a wrong—an injury-—without a
In 1 Saunders, p. 154, in a note to Eccleston v. Clipsham, cited by the defendant, it is said:
“So, though a man covenant with two or more jointly, yet, if the int&rest and cause of action of the covenantees be several and not joint, the covenant shall be taken to be several, and each of the covenantees may bring an action for Ms particular damage, notwithstanding the words of the covenant are joint.”
The case coming nearest to this that I have seen is Vance v. Blair, 18 Ohio, 532. The parties entered into an agreement with reference to a particular transaction, which would make them partners in that transaction. ,-Two of them finally sold out to a third, before commencing operations, and the third violated the agreement, and the two remaining parties sued that third party for the violation of the agreement. On demurrer for want of parties, the court says:
“Another objection is that Cary and ITyatt are not parties to the action. Cary and Hyatt, although parties to the contract, we think could not be parties to this suit. Before the work commenced, as can be fairly inferred from the declaration, they sold out, each his one-sixteenth of the right to the contract, to Blair. They have no cause of complaint against either party; nor can either party complain of them. 'They have not broken the contract, nor has either of the parties broken it with them. They cannot maintain a suit against Blair, because Blair admitted to them their rights under the contract, and paid them what they were willing to take for those rights. The plaintiffs cannot maintain a suit against them, because they duly claimed and received what they had a right to under the contract—the same that the plaintiffs' were claiming in this suit.”
The next point is that the defendants cannot he joined. It is alleged that they jointly conspired together to commit the breach; that they jointly conspired and jointly acted. Then they are jointly liable. I do not see why they cannot be joined. It may be true that if one of them had refused to carry out the contract alone, the other defendants would be entitled, on that ground, to refuse to go on with the others without him. Hut that is not set up. That is not the case made by the complaint. It may be a proper matter for answer. It is contended that plaintiff cannot recover, because if any one of the parties to the contract refused to carry it out, the rest would be entitled to repudiate the contract until he consents, because they only agreed to go into partnership with the others alone. That is not the aspect presented in this case. It is not alleged here that one refuses to go on, and that the co-defendants refuse to go on because of that refusal. The allegation is that the defendants “jointly conspired together and jointly committed the breach complained of.” That is the allegation. I think that ground is not tenable.
The further point is made that the contract is void for uncertainty. “The business of the partnership shall be buying, selling, and dealing in dry goods and furnishing goods, and such other wares and merchandise as may bo convenient and profitable to all parties concerned.” Certainly the dry goods business and furnishing goods business must he sufficiently well known to merchants to make it reasonably certain what the subject-matter is. Then, as to “such other wares and merchandise as may be convenient and profitable.” I see no objection to it, if the parties so choose to stipulate. It is an agreement. First, they shall deal in dry goods and the general furnishing goods business. Those terms have a well-known meaning among mercantile men. Then the further agreement is, in effect, that they shall deal in such other wares and merchandise as they may agree upon to he convenient and profitable. If they choose to put it in that form, I do not see that they have not the right to do so. They have, substantially, provided a mode and means of making it specific, by leaving it for their future decision as the occasion may
The next point is that either party could dissolve the contract, consequently no action lies. They have specified the term of five years from the first of January following for the term of the partnership; and it is provided that in case any one should go out of the firm there shall be no allowance for the good-will. After executing the contract these parties allege that they made certain other arrangements, which defendants knew, at the time of making the contract, the plaintiff must make in order to go into that partnership; by which arrangement plaintiff necessarily lost money. And then, after having sustained these losses, after taking upon himself these inconveniences, with the knowledge of defendants, these defendants refused to carry out the arrangements for the partnership, whereby the plaintiff sustained damages. It seems to me there is a cause of action stated here. What the rule of damage may be would be another question. What the amount of it, another question. They have agreed to enter into a partnership for the purpose of carrying on the prescribed business, which the defendants have violated. Certainly there must be some grounds for damage, at all events, even if nothing more than nominal.
The other point is that no such damages as alleged can be recovered. I have passed upon that point so far as the claim is concerned when I refused to strike out. I think there is a basis for damages of some sort alleged; certainly for nominal damages.
Demurrer overruled, with leave to answer on the usual terms.
Isam White against the same parties is an action brought by another one of the parties to the contract against the same parties for the several individual damage sustained by him.
Of course the same principle applies to that.
Levy White against the same defendants is the third case of the same kind, and the
Demurrer in each will be overruled on the usual terms
There is no doubt whatever that an action at law may be maintained by a party to an executory contract to form a future copartnership, to recover damages for a wrongful refusal by the other party to execute such agreement.
In Hill v. Palmer,
St. Paul, Minn., September 25, 1883. Robertson Howard.
Hill v. Palmer, 56 Wis. 123 ; S. C. 14 N. W. Rep. 20.
Venning v. Leckie, 13 East, 7 ; Gale v. Leckie, 2 Starkie, 107; Manning v. Wadsworth, 4 Md. 59 ;
Collamer v. Foster, 26 Vt. 754; Hill v. Palmer, supra; Venning v. Leekie, 13 East, 7; Elgic v. Webster, 5 Mees. & W. 518; Poster v. Allanson, 2 Term R. 479; Townsend v, Goewey, 19 Wend. 424; Bumpass v. Webb, 1 Stewart, (Ala.) 19; Williams v. Henshaw, supra.
Supra.