Case Name: John Pitts versus John Waugh and Joseph Greeley
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1808-05
Citations: 3 Tyng 424
Docket Number: 
Parties: John Pitts versus John Waugh and Joseph Greeley.
Judges: 
Reporter: Massachusetts Reports
Volume: 4
Pages: 372–374

Head Matter:
John Pitts versus John Waugh and Joseph Greeley.
The law merchant respecting dormant partners does not extend to speculations in land.
In an action of the case, the plaintiff declares that the defendants were partners in the way of merchandising, jointly negotiating together, particularly in the purchase and sale of divers tracts of land for their mutual profit and advantage; and being so partners as aforesaid, the said Waugh, at a day and place named, for value received, made a certain note in writing of that date, and with his hand subscribed, and thereby, for himself and the said Greeley, promised the plaintiff to pay him 337 dollars 50 cents, in three equal annual instalments, with interest from the date; by reason whereof the said Waugh and Greeley became liable to [ * 425 ] * pay the plaintiff the contents of said note according to the tenor thereof; and in consideration thereof prom ised, &c. There was another count, as on a note for the same sum made by the defendants jointly.
The defendant Waugh was defaulted. Greeley, the other defendant, pleaded the general issue, viz., that he and Waugh never promised, &c.
Upon the trial of this issue, before Thatcher, J., at the last September term in this county, the plaintiff offered to read to the jury a promissory note signed by the said Waugh, of the tenor following: “ Tyngsborough, May 19,1803. For value received, I promise John Pitts, Esq., or order, the sum of three hundred and thirty-seven dollars and fifty cents, in three equal yearly payments, with interest from the date, as witness my hand, John Waugh; ” and to prove, also, that before and at the time of making and signing said note, the defendants were partners, jointly negotiating together, as mentioned in the declaration ; and that said note was made and signed by the said Waugh on the partnership account aforesaid, and for lands purchased for the joint benefit of the defendants, but conveyed to the said Waugh. This evidence the judge refused to admit. The plaintiff excepted to the opinion of the judge, and a verdict being rendered for the defendants, the plaintiff moves for a new trial on that ground.

Opinion:
The motion was submitted to the Court at this term without argument, and the following opinion delivered by
Parsons, C. J.
The plaintiff's action is against the defendants on a note made and signed by Waugh, one of the defendants. As the note does not purport to be signed by Waugh and Greeley, nor by Waugh for himself and Greeley, the plaintiff must contend that Greeley is answerable as a dormant partner with Waugh; and the plaintiff offered to give evidence that they were partners in trade, negotiating together particularly in the purchase and sale of lands for their mutual profit; and that Waugh signed this note on the partnership account, and for the lands purchased for their joint benefit. This evidence being rejected, the plaintiff moves for a new trial.
* By the law merchant, a man may be answerable, as a [ * 426 ] dormant partner, on a contract made by the partnership, of which he is in fact a member. But this law is confined to trade and commerce, and does not extend to speculations in the purchase and sale of lands. When lands are sold, no man, as a dormant partner, can claim any part of the lands by virtue of any conveyance, to which he is not, on the face of it, a party. If the nominal purchaser choose to hold the lands, the party who advanced the money, if not named as a grantee, can have no title to the land, whatever remedy he may have against him to whom the land was conveyed ; he cannot, therefore, be holden to the vendor for the payment of any part of the consideration, unless he has agreed to be liable.
.In this case, there was no evidence offered that the land was conveyed by the plaintiff to Waugh and Greeley, or that Greeley in any manner authorized Waugh to bind him to the payment of this note ; or that the plaintiff sold the land on Greeley's credit, or knew that he had any interest in the purchase ; nor was there any evidence offered that Greeley knew of the purchase, or did or could derive any benefit from it. This is decisive ; for, by the law merchant, a man is holden a dormant partner, who is not known in the partnership, because he" is interested in the profits of the trade ; and as the conveyance was made to Waugh, Greeley can derive no benefit from it.
Mellen and Whitwell for the plaintiff.
Wilde and Perley for the defendants.
However, to prevent mistakes, we repeat that the law merchant does not extend to speculations in land. And by the statute of frauds, no man is chargeable on any contract concerning the sale of lands, but on some memorandum in writing, signed by himself, or by his agent lawfully authorized. In this case, there is no color for considering Waugh as an authorized agent of Greeley within the statute,
Upon every view of the case, the evidence was properly rejected; and a new trial cannot be granted.
Let judgment he entered according to the verdict
[Smith vs. Burnham, 3 Sum. 435. — Ed.]