78 Ind. 26 | Ind. | 1881
Lead Opinion
Suit by tbe appellee against tbe appellant, Joseph Uhl, and others who have declined to join in the appeal. The action was based on four certificates of deposit, there being two paragraphs of complaint predicated on each certificate, and the difference between these paragraphs being that in one it is charged that the defendants, at the time of making the certificate, were partners, doing a banking business, under the firm name of “People’s Bank,” and as such, in the course of their business, executed to the plaintiff, for money deposited, the certificate sued on; while in the other paragraph, instead of charging that appellant, Uhl, was a member of the partnership when the certificate was made, it is sought to hold him as a retired partner who had failed to give notice of his withdrawal from the firm. The second, fourth, sixth and eighth paragraphs are drawn upon the latter theory, and as they are alike, excepting the dates and amounts of the certificates on which they are founded, we need copy but one, which is as follows :
“ For amended eighth paragraph of complaint, the plaintiff complains of the defendants and says: That on the 1st day of January, 1874, and for more than a year previous thereto, the defendants were partners, doing business together under the firm name of ‘ People’s Bank,’ as private bankers in the city of Logansport, Indiana; that it was the business of said firm to receive money on deposit, and to pay interest on all moneys deposited at a rate agreed upon between the parties; that William H. Standley acted as president, and William H. Whiteside acted as cashier, of said firm; that said Whiteside, as cashier, was authorized by the members of said firm to receive money on deposit, contract for the rate of interest to be paid on such deposits, and to give the obligation of said firm for the payment thereof; that the defendant Joseph
The certificates on which the other paragraphs are based bear date respectively, February 23d, 1876, and April 6th and 9th, 1877. Demurrers to each paragraph were overruled and exceptions saved. A verified general denial and other pleas were filed. There was, however, in the special pleas nothing which was not provable under the general denial, because the matters averred were inconsistent with the allegations of the complaint, and not in confession and avoidance thereof. No replies, therefore, were necessary or admissible, and the rulings on the demurrers to the replies which were filed present no question. State, ex rel., v. Blair, 32 Ind. 313.
Here is a manifest inconsistency. The following is a better statement:
The general ground of liability of a person as a partner, who is not so in fact, is that he has held himself out as such to the world, or permitted others to do so, and that by reason thereof he is estopped from denying that he is one, as against persons who have in good faith dealt with the fix-m or with the person; so held out as a member of it. Reber v. Columbus, etc., Co., 12 Ohio St. 175; Drennen v. House, 41 Pa. St. 30;, Sherrod v. Langdon, 21 Iowa, 518; 3 Kent Com. 66.
And.it will not do to say, as has sometimes been done, Gow, supra, that the estoppel springs from the retiring partner’s “ xxegligent condxxct in forbearing to give notice.” The liability continues because of the failux’e to give the proper no
Returning to the point under consideration, it was enough, that the plaintiff should have charged the appellant as a, maker of the certificates, as was done in the first, third, fifth and seventh paragraphs of the complaint, the sworn denial of which presented the whole question of liability, and. made admissible all the, evidence adduced, whether to show the partnership, the facts concerning the appellant’s retirement, and the alleged failure to give notice thereof, or the. appellee’s knowledge on the subject. But on the strength of the answers of the jury to interrogatories, showing that the. appellant had withdrawn, and was not a member of the firm when the certificates were issued, the court, on the appellant’s-motion, gave judgment in his favor upon the last named paragraphs, and rendered judgment for the appellee upon the. other paragraphs, whose sufficiency must therefore be determined, as though they alone constituted the complaint.
The substance of the objections made to them is, first, that it may be presumed, for aught that is averred, that from and after January 1st, 18Y4, the appellant, Uhl, ceased to hold himself out as a partner in the business; and that, after the lapse of so long a time, the appellee, who had not before had any transaction with the firm, had no right to presume on a,
These objections are not sound. There is no legal presumption that the appellant ceased to be a member of a firm whose business continued uninterruptedly, because he ceased to keep up a newspaper notice of his connection. Once the public were well informed of the membership of the firm, there was probably no profit in continuing to publish the notice ; and the rule is that the retiring partner escapes continued liability, not by ceasing to hold himself out as a partner, but by giving affirmative notice of the dissolution, or of his withdrawal from the membership of the firm. As to the second point, the parties named are made defendants in the case, and the necessary inference from the allegations made is that they had continued in the partnership; and, in the absence of averment to that effect, there is certainly no presumption that others not named had come into the firm. The paragraphs show the appellant’s connection with the firm, and the public advertisement of the fact prior to January, 1874, the want of publication of notice of his retirement, and that the appellee, who knew of his membership but not of his retirement, gave credit to the firm in the usual course of its business, in the belief that the appellant was a member, and this is enough to entitle the appellee to recover, notwithstanding he had had no dealings with the firm during the time when the appellant was a member. One whose membership in a business partnership has been publicly advertised in the community where the business has been and is prosecuted, owes a duty, on retiring, to give notice thereof, not merely to the customers who have had actual transactions, but to the public, who may be misled into giving future credit, on the supposed responsibility of him who retires. Parsons Partnership,
There was no available error in sustaining demurrers to any of the answers, because, as already stated, they contained nothing which was not provable under the sworn general denial. The answers to which the demurrers were overruled were nothing but special or argumentative denials of matters averred in the complaint, and might well have been stricken out; but, being allowed to stand, they closed the issue, and neither called for nor admitted of reply. State, ex rel. Griswold, v. Blair, supra.
Exceptions were saved to a number of the instructions given to 'the jury.
The objection made to the fourth is not well founded in fact. As stated in the brief, the last clause of the instruction reads, “but the law does require that he make his retirement as notorious as was the fact of his membership.” The record, however, shoAvs that the court' gave it in this wise: “ That he should use all reasonable efforts to make his retirement as notorious,” etc., which is plainly quite a different proposition, but whether right or not we need not decide, because not discussed in the brief.
The sixth instruction, after enunciating a rule in general language, to which no objection is made, proceeds as follows: “So in this case, if the defendant Uhl, by his words or conduct, induced the plaintiff to believe him to be a member of the People’s Bank, and the plaintiff, upon such representations, made the deposits evidenced by the certificates sued on, he is liable as fully as if he'Avere in fact a member, for he negligently left the plaintiff to believe him still a member, and to deal with the firm upon that belief, and I state it as the law in this case, that it is not necessary that the defendant Uhl personally made such representations; but if the plaintiff deposited his money with the said People’s Bank, and previous to that time it was a matter of public notoriety
In this connection it may be stated that the appellant has saved his exception to the refusal of the court to give the following instruction:
“No. 17. If you find that these advertisements were made without the knowledge or consent of Uhl, and he, as soon as he heard of them, caused them to be taken out of the papers, then I charge you as the law that he is not bound by them. No person is bound by the act of another, unless done by his authority, or with his knowledge without objection.”
The position of the appellant, in reference to the instruction given, is sufficiently indicated by the terms of that which was refused; and if, as claimed, the jury was in effect instructed or led to suppose that the appellant might be held responsible for acts which he neither did nor authorized another to do, and had no knowledge of their being done, we could not hesitate to declare that material error had been committed. But, properly construed, with reference to the evidence in the case, it is clear that by the notoriety mentioned as having “ originated through him or his co-partners,” reference was had to the acts of himself or co-partners while they bore that relation to each other; and the proof being clear and undisputed that the appellant lived in Logansport, where the business was conducted, and where he was publicly advertised as a stockholder, and with the other stockholders as personally responsible upon the liabilities of the company, he was clearly responsible for the notoriety so produced, whether he or his partners caused the advertisement to be put into the daily paper where it was published. The evidence went farther, however, and showed that the advertisement, a copy of which will be given further along, was kept in the paper after the appellant’s withdrawal
The tenth instruction given was this:
“ The law requires that upon one member retiring from a partnership he must give notice of his retirement, and in giving notice of his retirement he must act in good faith. Now, if you find that Joseph Uhl, when he retired from the People’s Bank, before that agreed that he would keep his retirement a secret, and he did keep it a secret, then he did not act in good faith in his retirement; but, by his agreement to keep his retirement secret, he consented that he should continue to be represented as a member while that agreement continued.”
It is true, as counsel contend, that it is not an absolute requirement of the law that notice be givén, but only in case the one retiring was known as a partner, and in favor of an old dealer, or a new dealer who knew that he had been a member, but these are points sufficiently explained by other instructions which were given, and, in view of the evidence, this instruction was entirely proper. If, as there was some
The eleventh instruction is as follows:
“If you find that Joseph Uhl retired in 1874, that he told some parties before the plaintiff commenced dealing with the firm that he had retired, and you also find that to others he represented himself as being a member, that is a fact which you may consider in determining whether or not he acted in good faith in giving notice of his retirement. I also say to you that it is a matter of fact for you to determine whether or not Mr. Uhl acted in good faith, and whether or not the notice he gave, if you find that he gave any notice at all, is sufficient.”
Counsel insist that it was not an issue in the case, nor material to be considered, whether the appellant acted in good, faith, and that therefore it was not proper to give this instruction. It was, however, a question in the' case whether the appellant was a partner when the certificates were issued. He had been a partner, and unless he had retired was yet; but if he retired in bad faith, endeavoring to leave the concern the credit of his name, and yet to escape liability, then his bad faith defeated his purpose, and left him liable in fact as well as in appearance. It is true that the appellee needed not, under the issues, to prove so strong a case in order to prevail, but, nevertheless, he had a right to make the attempt and to have it submitted in that view to the jury.
Among the causes assigned for a new trial is the alleged error of the court in permitting the introduction of testimony that “ it was currently reported in Logansport that Uhl was a member of the firm of People’s Bank up to the fall of 1875.” The only point made against its introduction, however, is that it was not admissible for the purpose of showing either the existence of the partnership, or the appellant’s con
The advertisement already referred to, and which was shown to have been published in the Daily Star while the appellant was a partner and after his retirement, was of the tenor following:
“ People’s Bank Stockholders: Josephus Atkinson, Joseph Uhl, William H. Whiteside, George Strecker, William H. Standley, E. R. Thompson, Delaware, Ohio. Do a general banking business. Organized under the laws of the State, making every stockholder individually responsible for all liabilities.” And in reference to this the appellant requested the following instruction, and others involving the same idea, which were refused:
“No. 15. The plaintiff has introduced in evidence an advertisement in the Logansport Daily Star. The legal construction of those advertisements is for the court and not for the jury. Those advertisements do not give public notice of the existence of a partnership known as ‘ People’s Bank.’ But the legal effect of them would be to advise the public that there was a corporation organized, pursuant to law, in which Uhl is a stockholder. The plaintiff had no right to rely upon such notices to give credit to Uhl as a member of a firm known as ‘ People’s Bank,’ and if you find from the evidence that the only notice the plaintiff had, when he commenced dealing with the bank, was by those advertisements, and that Uhl had at that time retired from the firm, the court charges*38 you that the plaintiff had no right to rely upon the same as a public notice of his being a member of the firm.”
“We insist,” says counsel, “that the evidence was incompetent. The plaintiff did not show that Uhl ever authorized the publication or that he ever had any notice of it; therefore it was not competent. 2d. It did not tend to prove a partnership, or that Uhl was a partner. Both of these objections were pointed out.”
As we have already said in substance, there was evidence not only to warrant, but such as required the conclusion, that the appellant was responsible for the advertisement from the time its publication began until it was suppressed upon his order, and even for its continued influence thereafter, because of his failure to give such notice as was calculated tó remove the false impression made by the continued publication of the notice.
The objection that it did not tend to show a partnership, but a corporate organization, is still less tenable. There may be shares of stock and stockholders in a partnership as well as in a corporate body. Such in fact was the organization of the People’s Bank. Lindley’s very elaborate work is designed mainly to explain the law of partnership as applicable to stock companies not incorporated. Besides, the notice under consideration declared every stockholder individually responsible for all liabilities, which is true of a partnership, but not true of an incorporated bank, the shareholders in which, under the law of this State, are liable only “to the extent of the amount of their stock therein, at the par value thereof, in addition to the amount invested in such shares.” 1 R. S. 1876, p. 165, sec. 13.
It is further claimed that the court erred in refusing to submit to the jury, to be answered in case they found a general verdict, the following interrogatories:
“2. Did the defendant Joseph Uhl make either .of the instruments in writing sued on ?
*39 “ 3. Did the defendant Joseph Uhl authorize any one to make for him either of the instruments in writing sued on ?
“ 10. If the plaintiff had any other notice or knowledge that Joseph Uhl was a member of the firm of the 'People’s Bank,’ except the notice set out in question No. 9, state what it was.
'' 12. Did not the fact of Uhl’s retirement become a matter of public notoriety in business circles in the city of Logansport, where the firm did business during the years 1875, 1876 and 1877?
''18. Did not the plaintiff believe at and during the time he was dealing with the firm, that it was a corporation or association, and not a partnership?”
The Code, sec. 336, authorizes that the jury be required “to find specially upon particular questions of fact;” but the first and second of these interrogatories call for a finding upon the entire and principal issue in the case, that is, whether the appellant executed the writings sued on. Such questions are sufficiently answered by the general verdict, and are not the proper subject of special interrogatories.
Questions 12 and 18 are in substance the same as Nos. 7 and 17, which were answered, and we do not perceive that it was material or could in any way have affected the result, had the tenth interrogatory been submitted and answered by any pertinent response.
In answer to the questions which were submitted, the jury found, in substance, that the appellant retired and ceased to be a partner from and after April, 1874, but that his retirement was not a matter of public notoriety in the neighborhood where the firm did business at or before February 26th, 1877; that appellee had no dealings with the firm before February 23d, 1876, the date of the first certificate in suit; that the appellant had done and permitted acts to be done with his knowledge, which led the appellee to believe that the appellant “was a member of said firm at the date of any of the instruments sued on,” and that at said time the appellee had other notice or knowledge besides said advertisement, that the
The judgment is therefore affirmed, with costs.
Rehearing
On Petition fob a Rehearing.
It is strenuously insisted that the second paragraph of the reply was not a good reply to all the paragraphs of answer to which it was addressed, and that, for the error of the court in overruling the demurrer to it, the judgment ought to be reversed.
The following extract from the appellant’s original brief presents the question:
“The complaint is in eight paragraphs, each based upon a certificate for moneys deposited at different times, the last deposited in 1877. The first and second paragraphs are for money deposited in 1876. All the other deposits were made subsequently. The defendant, in his answer, says that he had retired before any of these deposits were made, and the plaintiff, before making the several deposits, had notice of his retirement. It is no reply to this answer to say that when plaintiff made the first deposit, sued upon in the first and second paragraphs of complaint, Uhl held himself out as a partner, and he had no notice of Uhl’s retirement. If he had notice when he made the third, fourth, fifth, sixth, seventh and eighth deposits that Uhl had retired, Uhl would be entitled to recover upon those paragraphs.”
The answers referred to were nothing but special argumentative denials, and there was no more propriety in replying to
If, therefore, the reply was too narrow, it is nevertheless clear that the verdict does not rest upon it, but upon proof abundantly sufficient and which was admissible independently of the bad paragraph; and, this being so, the error is not available. The Ohio, etc., R. W. Co. v. Collarn, 73 Ind. 261; Trammel v. Chipman, 74 Ind. 474.
Rehearing denied, with costs.