#### Arthur J. Wolf, Appellant, *v.*William M. Lawrence et al., Respondents.

(Supreme Court, Appellate Term,

December, 1900.)

Partnership — An interest in the profits as profits makes one a partner as to third persons.

A person interested in the profits of a business, otherwise than as compensation for his services, is a partner as to third parties and it is not necessary that he share the losses.

Appeal from a judgment of the Municipal Court of the city of New York, ninth district, borough of Manhattan.

Horace C. Skelly, for. appellant.

James Kearney, for respondents.

O'Gorman, J.

The defendants were engaged in business as real estate and loan brokers, and this action is brought to recover a *482balance due for services rendered by the plaintiff as a clerk under a' specified salary. Upon conflicting evidence, the plaintiff recovered judgment against the defendant Kenelly, but the1 complaint was dismissed as to the defendant Lawrence upon the ground that the latter was not a partner of his co-defendant. The plaintiff appeals from so much of the judgment as dismisses the complaint. While the plaintiff testified respecting admissions made by the respondents, in which he declared that he was a partner of the defendant Kenelly, the trial justice, in view of the respondents’ denial of such admissions, was justified in ignoring them; but the evidence of the defendant Lawrence, as disclosed by the record, supplied all the essentials of an agreement of copartnership between him and his oodefendant. He testified: “I have been associated with him (the defendant Kenelly) in business for about ten years, and about four or five years ago we made an arrangement. I had nothing to do with the running expenses of the office, but the arrangement was that we should divide expenses and divide what business came into the office.” He further testified that, under this agreement, all the proceeds were divided equally between him and his codefendant, after the expenses incident to the running of the office were deducted. He also stated that this agreement was not in writing, and that there never was a copartnership between them. This latter statement, however, is but the witness’s characterization of the relation existing between him and his codefendant, and is not sufficient to disturb the legal consequences necessarily resulting from the manner in which they actually conducted their business affairs. As a rule, the participation in the profits of an enterprise as such is sufficient to make a party liable' as a copartner, and the sharing of losses is not a necessary element.

As stated in Heye v. Tilford, 2 App. Div. 346, “Individuals may be charged as partners as to third persons, by voluntarily and knowingly sharing in the profits of. a business, or holding themselves out as partners, and thus inducing a credit on the faith of the supposed copartnership.” This rule, however, does not apply where it appears that the person is interested in the profits only as a means of compensation for services rendered. Hull v. Barth, 37 App. Div. 361; Hackett v. Stanley, 115 N. Y. 625.

It is quite obvious, therefore, that the evidence of the respondent establishes his own liability in this case. It is not pretended *483that his share of the profits in the enterprise was by way of compensation. Do snob suggestion appears in the record before us. The dismissal of the complaint was, therefore, erroneous, and as to him the judgment must be reversed, with costs to the appellant to abide the event.

Beekman, P. J., and Gtegekich, J., concur.

Judgment reversed and new trial ordered, with costs to appellant to abide event.