Case Name: OIL WELL SUPPLY COMPANY, Appellant, v. E. M. METCALF et al., Respondents
Court: Kansas City Court of Appeals
Jurisdiction: Missouri
Decision Date: 1913-11-17
Citations: 174 Mo. App. 555
Docket Number: 
Parties: OIL WELL SUPPLY COMPANY, Appellant, v. E. M. METCALF et al., Respondents.
Judges: All concur.
Reporter: Missouri Appeal Reports
Volume: 174
Pages: 555–561

Head Matter:
OIL WELL SUPPLY COMPANY, Appellant, v. E. M. METCALF et al., Respondents.
Kansas City Court of Appeals,
November 17, 1913.
1. NEW TRIAL: Evidence. When a new trial is granted and tbe party obtaining tbe verdict appeals, an appellate court will' take tbe facts to be wbat tbe evidence in favor of sucb party tends to show them.
2. PARTNERSHIP: Evidence. Evidence that tbe parties charged as partners went to tbe plaintiff’s place of business and stated tbat they were intending to organize a corporation, but until they did so, they would act as partners, and tbat one of tbeir' number would be tbeir field manager and would purchase . supplies of plaintiff; it was held, tbat this was evidence to justify a verdict tbat they were partners and were liable for supplies afterwards purchased.
3. AGENCY: Evidence: Declarations. One’s declarations without more, tbat be is an agent for others is not competent against such others. But if tbe agency is established prima facie, by other testimony, then bis declarations are admissible, and be is a competent witness in establishing a prima facie agency.
4. PARTNERSHIP: Holding Out. A partnership may he shown to exist in fact, or hy a holding out as such and either instance will suffice to hold it liable for obligations incurred.
5. -: Fraud of One Partner. Evidence that one of several partners induced them to enter the. partnership hy fraudulent misrepresentations is not admissible against a claim for goods purchased by such partner of one who did not know of the fraud.
6. PLEADING: Partnership: Individual’s Action. A person having a demand against a partnership may, under the statute, sue any or all of the partners, and aver in his petition that the contract is that of the defendants and to prove this averment he may prove the contract was made for the partners through an agent, and that agent may be one of the partners.
7. '-: Prima Facie Case: Declarations: Witness. After evidence has been given establishing, prima facie, that a partnership exist, the declarations and admissions of one of the alleged partners is proper evidence; and such partner is a competent witness.
8. -. A partnership bought goods of another through one of its members, and informed the seller that bills should be sent to the purchasing partner which he would approve and forward to the other partners who would pay the amount; it was held that this was not evidence that it was necessary that the seller must procure such approval before he had a right of action. It was merely a statement of a mode of payment.
Appeal from Jackson Circuit Court. — Eon.'W. O. Thomas, Judge.
Reversed and remanded (with directions).
Frank Eagerman, E. E. Ball and Clyde Taylor for appellant.
Metcalf, Brady $ Sherman and James E. Austin for respondents.

Opinion:
ELLISON, P. J.
Plaintiff's action is on an account for goods, wares and merchandise sold to defendants. The verdict in the circuit court was for plaintiff; but afterwards that court sustained a mo tion for new trial on the ground of error in "giving improper instructions on behalf of plaintiff, and for failure to give proper instructions in behalf of defendants." Plaintiff thereupon appealed and seeks to have the verdict reinstated and judgment rendered thereon.
Preliminary to consideration of the case we will say that in stating the facts we will confine ourselves to what the evidence in plaintiff's behalf tends to prove them to be.- We make this observation for the reason that defendants have made a lengthy statement of facts as the evidence in their behalf tended to prove them, without reference to the evidence in plaintiff's behalf.
One Ross had what is known as an oil lease on lands in Kansas and sought to develop it (in addition to what had already been done) by sinking oil wells and doing such other things as would bring it into profitable use. He came to Kansas City, Missouri, and interested the defendants in the project by selling them each an interest. They including Ross, were to form a corporation to be known as "The Happy Holler Oil and Gas Company," but. in the meantime they were to proceed as partners; or, at least, they held themselves out to plaintiff as partners. They needed metal casings and joints and they went to plaintiff's establishment, where such articles were kept for sale and stated to the general manager that they would want to purchase supplies, that they intended to organize a corporation, but until they did they would be partners. They made arrangements with him to furnish supplies which they said would be bought by Ross whom they said was their field manager. That the bills should be sent him for articles purchased, which he would approve and send to defendants in Kansas City who would pay them. Afterwards they directed Ross to contract for the drilling of wells and supplies there for, who, in compliance therewith ordered the supplies making up the account in suit, and these were delivered by plaintiff. They were afterwards taken oh an attachment writ for labor in drilling wells. There were seven of those parties but as service was had only on these four against whom the verdict was rendered we will consider them as the defendants, and they are the ones (Metcalf representing himself and Brady) who; made the representations and arrangements above stated.
Undoubtedly the foregoing facts, if believed by a jury, are ample to sustain plaintiff's case; and we therefore turn attention to the action of the court during the progress of the trial to see if any thing transpired to justify it in setting aside the verdict.
It is asserted that Ross was not á competent witness to prove his own agency. That is an erroneous idea. One's agency cannot be shown, at second hand, by proving declarations he has been heard to make; but that he may testify to- his own agency is no where questioned. [City v. Fisher, 60 Mo. App. 511; Christian v. Smith, 85 Mo. App. 117; Griswold v. Haas, 145 Mo. App. 578.]
And, as we shall see further on, the same may be said to the objection that Ross was not a competent witness to prove the partnership as against the other alleged partners.
We cannot understand the applicability of defendant's contention that the holding out of a partnership, when in fact there was none, will not avail a person seeking to charge such partnership unless he had knowledge of the holding out. The proof was abundant that the holding out was made directly to plaintiff's general manager. The statements made by defendants to the general manager as to there being a partnership, if true, established a partnership in fact. If they were not true, it established a partnership by a holding out as such. Either view will suffice to hold defendants.
Defendants contend that Ross inveigled them into the purchase of an interest in his lease by fraudulent misrepresentations and that the court erred in instructing the jury that that fact could not affect the plaintiff's right to recover. Manifestly the instruction was correct. The troubles between Ross and these defendants do not concern the plaintiff and Ross' misconduct (if any) should not be visited upon it.
Plaintiff's instruction number 3, omits any reference as- to whether there was a partnership between defendants and Ross, but submits that if defendants told plaintiff's manager' that Ross would represent them in purchasing' articles and that Ross made such purchases, the verdict should be against those who made such statements to the manager. It is said that the petition only declares on a purchase by a partner for a partnership, whereas the instruction authorizes a recovery if the purchase was made by Ross as agent for individuals. The instruction was proper under our statute as it has been all along interpreted. In Gates v. Watson, 54 Mo. 585, it was said that "At common law, when part only of the members of a partnership were sued on a partnership contract, the partner sued might plead a nonjoinder of the other parties in abatement. But our statute makes all such contracts joint and several and a person having a demand against a partnership under our statute may sue any partner or all of the partners at his election, In such case he may aver that the contract sued on is the contract of the. defendants; and to prove this averment, he may show that the contract was made by the parties sued through an agent authorized to make it for defendants; or, what is the same thing, he may show that the defendants and another were partners, and the contract was made by such partner for the benefit of. the firm in the usual course of business." To the same effect is Crews v. Lackland, 67 Mo. 619.
It also is insisted that the defendants were prejudiced by the court's action in modifying one of their instructions so as to cut out a broad and express direction to the jury that no declaration or act of Ross as to the existence of a partnership should be considered unless such act or declaration was with the knowledge and consent of the other alleged partners. No error was committed in striking that out. It is true you cannot prove that a partnership existed by the acts and declarations of the alleged partner. But if you first, make out a prima facie case, as was done here, that a partnership exists it is-then proper, in corroboration, to show that he acted as such and stated that he was. As already seen this is the rule as to agency. [Peck v. Ritchey, 66 Mo. 114; State ex rel. v. Henderson, 86 Mo. App. 482; Worth v. Ollis, 61 Mo. App. 401.] And the rule that the act of one partner binds the other springs from agency; and the rule governing the latter class, ought in this respect, to apply to partners; and so it is held to be the law in partnership cases. [Campbell v. Dent, 54 Mo. 325, 331; Clark v. Huffaker, 26 Mo. 264; Bank v. Outhwaite, 50 Mo. App. 130; Conlan v. Meade, 172 Ill. 13, 17; Alcott v. Strong, 9 Cush. 323, 328; Phillips v. Parrington, 15 Maine, 425.]
The further point is made that under the evidence the account for supplies, under the directions given plaintiffs, must have J>een approved by Ross before it became a debt of the defendants. This is not a proper interpretation of the evidence. The accounts were to be sent to Ross, evidently for his approval since he was personally to make the purchases. The evidence does not show that his approval was a requisite to the existence of a valid claim of indebtedness against the defendants. It was a matter between Ross and the defendants and afforded the latter the means of knowing when to make payments. Certainly goods should not be confiscated by a partnership because one of the partners who made the purchase failed to certify, for the convenience of his copartners in paying his and their debt, that the account was correct.
There were some other suggestions in behalf of defendants, but we think nothing to justify a new trial. The judgment will therefore be reversed and the cause remanded with directions to enter judgment on the verdict.
All concur.