Case ID: iowa_50/html/0320-01.html
Source: Caselaw Access Project
Author: {"author": "Rothrock, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Knox v. Buffington & Co. et al.
    1. Partnership: powers of partners : contract. If a party dealing with a partner has notice of a restriction upon the general powers of the-partner, he cannot subject a copartner to liability upon a contract entered into in violation of such restriction.
    
      Appeal from Louisa Circuit Court.
    
    Wednesday, March 19.
    Action upon a promissory note for one hundred and seventy-five dollars, executed by J. Q. Buffington & Co., payable to the order of W. C. Knox & Son. The copartnership of J. Q. Buffington & Co. was composed of J. Q. Buffington and H. C. Wortham. Wortham answered for himself and also for the partnership, averring that said note was given for certain machinery attached to the flouring mill belonging to said' partnership, and that he, said Wortham, never consented to-said purchase, but positively refused, and so notified the plaintiff before said purchase was made; that with full knowledge-of such refusal to purchase the plaintiff sold said machinery to said Buffington, who, in fraud of the rights of defendant Wortham, executed the said promissory note, and that said defendant never received any consideration therefor. There was a trial by the court and a judgment for the defendants-Plaintiff appeals.
    
      
      G. W, Watters, for appellant.
    
      B. II. Hanna and Tatloek & Wilson, for appellees.
   Rothrock, J.

It is conceded that the partnership firm of J. Q. Buffington & Co. consisted of J. Q. Buffington and H. C. Wortham, and that the business of the partnership consisted in operating a flouring mill owned ky £rm_ mao;hinery jn question was placed in said mill on trial, before the said partnership was formed, and while the said mill was owned by other parties.

We think the court was warranted in finding from the evidence that, at about the time the note was given, the plaintiff appeared at the mill, claiming that the machinery had been sold, and not left on trial. This claim seems to have been abandoned and plaintiff proposed to sell to Wortham. . Wortham told him he would not buy, and that he and Buffington could not run the mill in partnership, and offered to stop the mill and set the machinery out. Wortham was then negotiating a sale of his interest in the mill to Buffington, and told him if he wished to purchase the machinery to do so, but that he (Wortham) would have nothing to do with it. Buffington afterward made the purchase and executed the note in suit, but without the knowledge of Wortham, who in a short time after that sold out his interest in the partnership to Buffing-ton. In the sale no account was taken of said machinery, and Wortham did not know that a partnership note had been given until after he sold his interest in the mill and until after said note became due; It is true there is a conflict in the evidence as to Wortham’s refusal to make the purchase, and as to his knowledge that a partnership note had been given. It is not our province, however, to determine the credibility of the witnesses where there is a conflict in their testimony, and we cannot say that the court did not find these questions of fact correctly.

That the purchase of the machinery was within the scope of the partnership business is not denied. In the absence of a refusal upon the part of Wortham to make the purchase, or of notice to the plaintiff of such refusal, there can be no doubt thaf the purchase made by Buffington would have been binding upon the partnership and upon the individual mempers thereof.

But here was an express restriction of the general powers of Buffington, of which the plaintiff had notice when he sold the machinery Under such circumstances we think he could not by his act bind his copartner. “If the party dealing with a partner has knowledge of any restrictions of the general powers of the partner, as between him and his copartners, he will be bound by them, and he cannot insist upon his acts under the general powers of a partner in violation of such restrictions.” 5 Wait’s Actions and Defenses, 126; Collier on Partnerships, § 387, et seq.; Boardman v. Gore, 15 Mass. 339; Leavitt v. Peck, 3 Conn., 125.

Affirmed: