Case Title: Ditzel v. Kent

Citation: 308 P.2d 628

Docket Number: 

State: montana

Court: Montana Supreme Court

Date: 1957-03-27T00:00:00Z

Document:
308 P.2d 628 (1957) Charles DITZEL, Plaintiff and Respondent, v. Ralph V. KENT and Eva M. Kent, his wife; Lewis J. Beaty and Freda E. Beaty, his wife, copartners, Defendants and Appellants. No. 9329. Supreme Court of Montana. Submitted March 21, 1957. Decided March 27, 1957. Rehearing Denied April 5, 1957. *629 Hugh J. Lemire, Miles City, Mr. Vincent Mulvaney, Cheyenne, Wyo., for appellants. Colgrove & Brown, Miles City, for respondent. ANGSTMAN, Justice. Plaintiff, a licensed real estate broker, brought this action to recover the sum of $10,500 alleged to be the commission due him pursuant to a written contract of sale of real estate signed by defendant, Lewis J. Beaty, a copy of which is attached to the complaint. The property involved was alleged to belong to all the defendants as partners. The complaint alleges that the defendant, Lewis J. Beaty, signed the contract acting on behalf of the partnership and with the authority of all the named defendants; that the contract was wrongfully breached by the defendants by selling the property later to G.W. Patterson. Summons was served on defendant, Lewis J. Beaty, and he is the only one who appeared in the action. He filed an answer in which he denied all the allegations of the complaint except the sale of the property to Patterson. By an affirmative defense he alleged in substance that the record owner of some of the land was Kent and Beaty, a co-partnership, and the record owners of the rest were the four named defendants; that on March 24, 1951, when the contract was signed by him he was not acting as agent for the other three defendants or as a partner of any of them or with their authority; that the contract which he signed shows on its face that the sellers were Lewis J. Beaty and Ralph V. Kent; that the contract was not signed by Kent, one of the sellers; that defendant Beaty was not acting for any partnership when he signed the contract; that plaintiff and the purported purchaser, Joseph Kejr, had personal knowledge that Lewis J. Beaty had no authority to act for the other defendants in signing the contract. The cause was tried to the court sitting with a jury, resulting in a verdict for plaintiff and against defendant, Lewis J. Beaty, in the sum of $10,500. Defendant Lewis J. Beaty's motion for a new trial was denied and he has appealed from the judgment. The record discloses that after the necessary preliminary conferences were held plaintiff drafted, in writing, an offer on the part of Joseph Kejr to buy the lands in question. The offer contained a general description of the land commonly known as the Caprock Ranch, and an unqualified offer of Kejr to buy it for the sum of $210,000; recited the payment of a deposit of $20,000 and fixed the time for paying the balance. It contained a notation to see the reverse side for additional terms and conditions. On the reverse side among other conditions was a statement that the names of the sellers were Lewis J. Beaty and Ralph V. Kent. The offer also contained an attached sheet which gave a description of the property and a recital that it represented "Holdings in Custer County of Ralph V. Kent and Eva M. Kent and Lewis J. and Freda E. Beaty" and was signed by the purported *630 purchaser, Joseph Kejr. Following the offer were these statements: In the preliminary negotiations resulting in the written instrument all parties understood that the ranch property was held and owned by partners. Plaintiff testified as follows: Mr. Kejr testified that the sellers were first demanding a price of $235,000 and there was also discussion about trading in some Kansas and Colorado property but after that proposal was abandoned he offered to pay $210,000 and that Lewis J. Beaty said to him: The record bears out the conclusion that the agreement to pay the commission was dependent upon obtaining the signatures of the other joint owners of the property. Beaty, of course, was not interested in paying a commission for the sale of the land unless the entire ranch was sold. He was not interested in disposing of his undivided interest, nor was Kejr interested in buying any fractional interest in the property. Beaty's counsel contend that the action was one brought against the partnership as an entity and that it was improper to obtain a verdict and judgment against the individual defendant, Lewis J. Beaty, personally. Counsel are in error in supposing that this action is one against the partnership as a separate entity. The rule applicable here is stated in 68 C.J.S., Partnership, section 209, page 683, as follows: For cases supporting this view see Jones Trucking Co., Inc., v. Superior Oil Co., 68 Wyo. 384, 234 P.2d 802; Balley v. Davis, 75 Idaho 73, 267 P.2d 631, 44 A.L.R. (2d) 575; Ferry v. North Pacific Stages, 112 Cal. App. 348, 296 P. 679; Steele v. Wardwell, 57 Cal. App. (2d) 642, 135 P.2d 628. The statement of the representative character following the names of the parties is treated as descriptio personae. 67 C.J.S., Parties, section 100, page 1097. Plaintiff, in contending that the verdict and judgment are proper, relies upon the rule stated in 40 Am. Jur., Partnership, section 148, page 235, as follows: Plaintiff relies upon the case of Brooke v. Glide, 39 Cal. App. 534, 179 P. 546; Lewis v. Clarkin, 18 Cal. 399; Morgan v. Righetti, 113 Cal. xvii, 45 P. 260; and Bonneau v. Strauss Brothers, 72 Okl. 110, 179 P. 10, 4 A.L.R. 255. Those cases are not applicable here for the reason that the partner who was held individually liable in those cases assumed to act for the co-partners or assumed to represent the partnership. Here as above indicated everyone concerned in this transaction knew and understood that the contract had no vitality until the signatures of the several parties were obtained. The case of Brooke v. Glide, supra, was one where one of the partners purported to bind the partnership by signing the name of the partnership. Unlike the Brooke case, here plaintiff knew throughout the dealings that the land was jointly owned. Beaty signed as one of the owners only, and did not purport to sign for the other joint owners. Plaintiff was in no way misled. Plaintiff contends however, that Kent participated in the negotiations and orally assented to the terms and conditions of the offer by Kejr. He also contends that Beaty assumed to have authority to represent the joint owners since there was evidence that he stated that after the contract was written up by plaintiff one of these gentlemen would (meaning either Beaty or Kent) sign it. This testimony is not sufficient to show that when Beaty signed the statement he assumed to act for the partners, particularly when he merely signed his own name and did not purport to sign for any of the other co-owners. Likewise, as to Mrs. Beaty and Mrs. Kent there was no evidence that they participated *632 in any of the negotiations. Plaintiff was not justified in supposing that the contract had any validity as against anyone until it was executed by or on behalf of all the sellers. There are no statutes in this state that militate against this view. R.C.M. 1947, § 63-201, in part, provides: R.C.M. 1947, § 63-202, in part, provides: Paragraph 4 of this section has no application here, as contended by plaintiff, since plaintiff had knowledge of the fact that Beaty had no authority to bind the partnership, and is therefore ruled by the latter part of paragraph 1, section 63-201. Likewise the sale of all the property of a partnership is not the carrying on in the usual way of the business of a partnership within the meaning of section 63-201. These statutes though relating to deeds and conveyances are not substantially different from those considered by the court in Ridgley v. First National Bank, C.C., 75 F. 808, 809, relating to mortgages of real property where the court said: The case of Springer v. Simpson, 175 Ill. App. 631, takes a contrary view as respects the lease of property to a partnership. *633 The court in that case held that where only one partner signs the lease as lessee, he was properly held liable for damages for breach of covenants of the lease. The principal holding however was that the point was not properly raised and hence turned on a question of procedure with but little consideration given to the point on its merits. Furthermore, in that case the lease was actually carried out by a change of possession of the property and hence there is reason to believe that the partner who signed the lease had authority to act for the partnership. It follows that plaintiff is not entitled to recover on the alleged contract sued on. The judgment is reversed and the cause remanded with directions to dismiss the action. HARRISON, C. J., and CASTLES and BOTTOMLY, JJ., concur. ADAIR, J., dissents.