Case ID: scl_35/html/0012-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Curia, per Withers, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Ramey & Taggart, for their assignees, v. McBride & Posey.
    
    The decree of the Circuit Judge upon the facts, is equivalent to the verdict of a jury — where, as in the summary process jurisdiction, he occupies the place of a jury.
    Private agreements by one partner, for his separate advantage, not fully executed until a litigation has arisen between his creditors and the firm, after tire dissolution of the firm, and not reasonably established to have been loiown to and approved of by another partner — shall not, practically, expand tire legitimate agency, already extensive, which the relation of partnership produces, to a class of transactions which, if freely favored, may worlr great injury to partnership assets, and thereby to associates in the firm, and the creditors of it.
    
      Before Wardlaw, J. at Abbeville, March, 1849.
    
      Sum pro.
    
    on account for services rendered by plaintiffs, as commission agents.
    Account admitted — and also admitted that an assignment was in April, 1848, made by the plaintiffs to J. Sibley, in trust for the creditors of plaintiffs, which included this account.
    DEFENCE — PAYMENT.
    
      Johnson Rainey, one of the plaintiffs,
    was offered as a witness for the defendants, and after objection by the plaintiffs’s attorney, he being fully advised of his rights and liabilities, was willing to be sworn, and was admitted. He testified as follows:
    I am now insolvent — in the summer of 184T, a partnership was formed between myself and John Taggart, both then residing at Abbeville, for conducting a warehouse and commission business in Hamburg. I went to Hamburg in September, ’47 — he a little sooner. In the fall of that year, I made an agreement with the defendants, shopkeepers at Abbeville, (to whom I was then indebted, and ever since have been, in an amount greater than this account now sued on,) that Ramey and Taggart would do their business in Hamburg, if they would patronize them, and the amount of it should go in payment of my debt to them. Under this - arrangement this account was made. I think I mentioned the arrangement to Taggart, and also to Crapon, partner of J. Sibley.
    
      Cross-examined. — This account is contained in the schedule annexed to the assignment. The assignment contemplated a schedule to be made, and one was made by Taggart and signed by me. Other persons transferred business to me, from former agents, under similar arrangements,
    Decree for defendants,
    
      The plaintiffs appealed, and moved the Court of Appeals to reverse the decree of his Honor, on the following- grounds :
    1. That his Honor erred in overruling the objection to the admission of the testimony of one of the nominal plaintiffs— Johnson Ramey being a party to the record, and not having been served with interrogatories to answer; and permitting him to be sworn to defeat his own deed of assignment, (so far as the assigned demand, sued on in the above case, was concerned, and which demand was included in the said assignment, and particularly specified in the schedule thereto annexed,) which was executed by the witness and his co-partner Taggart, for the benefit of all their creditors — both creditors of the co-partnership, and of themselves individually; and to establish an alleged agreement by him, made- with the defendants, that his individual debt should be discounted against any indebtedness which defendants should incur to the co-partnership Of nominal plaintiffs.
    
      2. That his Honor erred in permitting an individual debt to be pleaded in discount against a demand due to á co-partnership, and giving thereon a decree for the defendants.
    3. That his Honor erred in rendering a decree for the defendants, in the absence of any sufficient, positive and certain evidence, to take the case out of the operation of the principle of law on which the second ground of appeal above is predicated.
    4. That his Honor erred in giving a decree for the defendants, because there was no certain evidence of notice to the co-partner, Taggart; and no evidence whatever of any assent or agreement, on the part of Taggart, that the debt of Ramey should be paid out of the co-partnership funds, or discharged in the manner arranged by Ramey with the defendants.
    5. That his Honor erred in giving a decree for the defendants, because if Ramey himself .intended that his debt to the defendants should be paid out of the co-partnership funds, or discharged in the manner agreed on by him with the defendants, he ought to have debited himself with the goods delivered to the defendants, and the items of charge of the indebtedness of defendants to the co partnership of Ramey and Taggart, on the firm books.
    6. That his Honor erred in giving a decree for the defendants, because the notice of discount was too vague and general — without specification of items or precise amount; and because no particular discount was proved.
    7. That his Honor erred in giving a decree for the defendants, because the discount exceeded the summary process jurisdiction of the Court.
    8. That his Honor erred in giving a decree for the defendants, against the law and the evidence.
    
      Yancey, for the motion.
    
      T. Thompson, contra.
   Curia, per Withers, J.

— If it appeared from the reported cas6j that the fact of the assent of Taggart, the partner of Ramey, to the arrangement made by the latter, with the de-fondants, was established,, either expressly or inferentially, we would not be inclined to disturb the result. If Ramey, while exercising the powers of a partner, had acknowledged payment of the account now sued upon, it is not perceived that Taggart, or the assignees of Ramey and Taggait, could have looked beyond that act; unless the defendants could be implicated, in such transaction, with Ramey in that degree or species of fraud which would destroy the validity of the discharge, in the eye of a Court of Law. A receipt of Ramey and Taggart, executed by Ramey while clothed with the power of a partner, to McBride and Posey, appears to be a different transaction from that which is proved, to wit: a ■credit by McBride and Posey, of the amount of their indebtedness to the plaintiffs, on Ramey’s account with them, though in pursuance of agreement with him, which is not well proved to have been assented to by Taggart. We do not mean to say that if the fact of Taggart’s knowledge and approval of Ramey’s arrangement with the defendants, had been distinctly considered and affirmed by the Circuit Judge, we would, by any means, revise his conclusion. For, the true theory is, that the decree of the Judge upon the facts, is equivalent to the verdict of the jury — where, as in the summary process jurisdiction, he occupies the place of the jury. Without any strong opinion that the true merit of this case has not been justly expressed in the decree, we are, nevertheless, led by a desire to be cautious as to general consequences — that is to say, to encourage no idea that private agreements by one partner, for his separate advantage, not fully executed until a litigation has arisen between his creditors and the firm, after the dissolution of the firm, and riot reasonably established to have been known to and approved of by another partner — shall practically expand the legitimate agency, already extensive, which the relation of partnership produces — to a class of transactions, which, if freely favored, may work great injury to partnership assets, and thereby to associates in the firm and the creditors of it. Upon this consideration, passing by all others suggested in the grounds of appeal, we think this case should go back for another hearing.

A new trial is, therefore, ordered.

Richardson, O’Neall, Evans and Frost, JJ. concurred.

Motion granted.