62 Iowa 537 | Iowa | 1883
The facts as shown by the answer are, that the goods in question were purchased by the defendant of one J. F. Doty & Co., the plaintiff’s assignor; that this firm consisted of J. F. Doty and James R. Day, and was engaged in selling lumber and coal at Storm Lake; that Doty resided at Storm Lake, and was the active member of the firm, and had the entire and exclusive management and control of the business; that Day resided in Dubuque; that the sale by J. E. Doty & Co. to the defendant of the goods in question was made through Doty as a member of the firm; that the defendant was a merchant at Storm Lake, engaged in a different line of trade, and sold goods in his line on credit to Doty for his
These are, in substance, the averments upon which the defendant relies as showing payment, but in our opinion they do not have that effect. A partner has authority to bind the firm in.all matters pertaining to the partnership business. But it is not properly partnership business to release indebtedness due to it, in consideration of the release of indebtedness due to its debtor from one of its members. The precise question arose in McNair v. Platt, 46 Ill., 211. In that case the court said: “The rule is firmly established, and not to be controverted, that, where a member of a copartnership is indebted to a person owing the firm, he cannot apply the indebtedness due to the firm for the purpose of canceling his
He insists that it is a great hardship if his settlement with .Doty cannot be sustained. But he knew, or should have known, that his transaction with Doty was not within the scope of the firm business, and, unless sanctioned by Day, was a misappropriation by Doty of firm assets. When a person enters into such a transaction with a member of a co-partnership, it appears to us that we are justified in saying that it is his duty to see whether or not what appears to be a wrong on its face is so in fact. We think that the demurrer to the defendant’s answer was properly sustained.
Affirmed.