Case Name: Holdane el al., Plaintiffs and Appellants, v. Butterworth, Respondent
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1859-05-14
Citations: 5 Bosw. 1
Docket Number: 
Parties: Holdane el al., Plaintiffs and Appellants, v. Butterworth, Respondent.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 18
Pages: 1–16

Head Matter:
Holdane el al., Plaintiffs and Appellants, v. Butterworth, Respondent.
1. Where a person (B.) is in partnership with another (T.) in a business described as the business of “ The Atlantic Forge Company,” but in which the correspondence is conducted and all contracts made in the name of T., (the name of B. in no manner appearing in the business,) and thereafter the firm is dissolved, and a new partnership is formed by T., the co-partner, and a third person, under a different name, to conduct the same business at the same place, and the partners in such new firm immediately send a notice of that fact- signed by them, by post, to all who had dealt with the old firm, and subsequently a vendor who had never dealt with the old firm, makes a sale of goods on credit, nominally, to such former co-partner, T., in whose name the business of the . old firm had been done, and takes a note signed by the new firm in its true name, he cannot charge the person, so. retiring, as a continuing partner, although he knew by- common notoriety that the person so retiring had been a partner, and supposed that he then was, provided it was also a matter of public notoriety, on and after the formation of the new'firm, that it had been formed by such co-partner and third person, in a new name, and that it had in fact transacted its business in such new name.
2. Where the facts specially found entitle a defendant to a general verdict, 1 the plaintiff will not be entitled to a new trial because portions of the charge may have been erroneous, when such portions of the charge could not possibly affect the minds of the jury in considering the evidence relating to or in determining such special facts.
(Before Bosworth, Oh. J., and Hoffman and Moncrief, 3". J.)
Heard, April 15;
decided, May 14, 1859.
This is an appeal by the plaintiffs (John H. and James H. Holdane) from a judgment entered on a verdict in favor of the defendant, (John E. Butterworth,) rendered at a trial had before Mr. Justice Slossokt and a jury, in March, 1858. Charles H. Tupper and Wesley M. Lee were also named as defendants, but neither of them was served with the summons or appeared in the action.
The complaint states that the defendants on the 10th of October, 1855, were partners “ under the name or style of C. H. Tupper, or C. H. Tupper & Lee, at the building usually known as the Atlantic Forge, Ho. 268 Eleventh street,” in New York city.
That on that day the plaintiffs, being partners, composing the firm of Holdane & Co., sold and delivered to the defendants ninety-one pieces of iron, for the price of $659.22, on a credit of six months, for which the defendants have not paid.
The answer denied the allegations of the complaint.
On the trial it was proved, that for several years prior to March, 1855, the defendants Butterworth and Lee were partners and did business at Ho. 268 Eleventh street, under the firm name of the Atlantic Forge Company. That Butterworth was its capitalist, but transacted individual business at the Merchants’ Exchange, two and a half or three miles distant, and was at Ho. 268 Eleventh street only occasionally, sometimes once a week, and sometimes not in three or four months. The correspondence of the firm was conducted and its notes and contracts were signed in the name of Charles H. Tupper alone. The name, Charles H. Tupper, at the time of the trial, and for several years previously, was placed conspicuously on a large sign on the top of the building, the whole length of the roof, and the words “ Atlantic Forge ” were painted conspicuously on the same building.
Tupper & Butterworth did no business after the first of January, 1855 ; they dissolved partnership prior to March of that ’ year; on the 1st of March, 1855, the defendants, Tupper & Lee, formed a partnership, under the name of “ 0. H. Tupper & Lee Lee was a man of but little means,- and for some time previous had been foreman of the establishment; the new firm conducted its business at the same place, and in its proper name. They sent circulars, dated March 1, 1855, signed with their names in full, “ by the post, to such parties as had formerly dealt with the house,” stating that they had formed such partnership to transact the same business as the Atlantic Eorge Company had previously done, and at the same place; and the same fact was also communicated orally to some of those who had formerly dealt with the old firm; no notice of the dissolution of the old firm or of the formation of the new one was published in any newspaper.
It was proved that there was a small tin sign on the front office, before the new firm was formed, which was taken down, and that a new sign was put up, (when the new firm was formed,) having on it'the names, “ C. H. Tupper & W. M. Lee.” That the debts owing in March, 1855, when the firm was dissolved, were paid principally by Butterworth, at his office in the Merchants’ Exchange. Butterworth was not in any way interested in the new firm.
The sale of the iron by the plaintiffs was made thus: On the 8th of October, 1855, the plaintiffs sent to C. H. Tupper a note in these words, viz.:
“New York, Oct. 8th, 1855.
“ C. H. Tupper, Esq.:
“ Dear Sir—W e have for sale about ten tons faggoting iron, $55 per ton, 6 months. These are of Ford’s make.
“ Very respectfully,
“ Holdajste & Co.”
Tupper called on the plaintiffs soon, and said he would take the iron, and would send his cart for it. He did so. The plaintiffs charged the iron to C. IE Tupper, and made out and sent with it a bill for it in the name of C. H. Tupper. About a month after the iron was delivered the defendants sent to the plaintiffs a note, dated October 10th, 1855, for the amount of the bill at six months, signed “ C. H. Tupper & Lee,” which note the plain tiffs produced at the trial and offered to cancel. The plaintiffs were ignorant of Lee’s connection with the firm until they received this note. James-H. Holdane (one of the plaintiffs) testified that this was the only transaction of his firm with the house doing business at the Atlantic Forge. That as early as 1853 “ he learned, and it was generally known in the trade, that Butterworth was a member of the house doing business in Eleventh streetthat he had not heard of his retirement until C. H. Tupper & Lee had failed, in December, 1855, and “ supposed ” when the iron was sold that Butterworth was a partner. The case does not show whether John H. Holdane, the other plaintiff, was or was not examined. “ There was evidence on both sides, on the questions whether or not Butterworth was generally known to be a member of the house, and whether.or not it was generally known that a change had taken place in the firm in March, 1855.” The plaintiffs objected and excepted to this question being put to Josiah Shove, who was in the employment of the new firm, viz.:
Q. “ Was it or not generally known among the dealers of the Atlantic Forge Company or Charles H. Tupper, and the trade generally, that there had been a change in the firm ?”
A. “ It was.”
Being shown a bundle of papers, the same witness stated that they were fourteen letters received by Tupper & Lee from various customers, in different parts of the country, since the 1st of March, 1855, and that all of them were addressed to Tupper & Lee. To the admission of this evidence the plaintiffs excepted.
Butterworth testified that it was not generally known that he Vas a partner in the business of"Charles H. Tupper.
Tupper & Lee, in December, 1855, when they failed, made an assignment to the defendant, Butterworth, for the benefit of their creditors. The judge charged that the plaintiffs cannot recover, if it was not a matter of public notoriety that Butterworth was a member of the prior firm, so that the plaintiffs from that source had, or may fairly be supposed to have had, notice of his connection with the firm. .
That they cannot recover, although it was a matter of public notoriety that he was a member of the firm, if the change of the firm on the first of March was also a matter of public notoriety, or if “such steps were taken by the.old or new firm or by Butterworth to make it known, as that the plaintiffs on inquiry might have ascertained it.”
But if the change of the firm was not also a matter of public notoriety, or if “no such steps were taken to make it known as that the plaintiffs on inquiry could have ascertained it, then they are entitled to recover.” -
„ That as there is no evidence “that Butterworth ever held himself out to plaintiffs, as a member of the firm, and his name not being used in the firm, and the plaintiffs having had no transactions with the firm while he was a member of it; they cannot now charge him as a member of the firm, except on the ground that they may be reasonably supposed to have given credit to the firm in the transaction in question, from the belief induced by the general notoriety of his previous connection with it, that he was still a member, and the absence of a generaLnotoriety of the change of the firm, or of steps taken to make the change known, so that on inquiry they could have ascertained it.”
The plaintiffs excepted, severally, to each part of the charge.
The jury found a general verdict for the defendant, and in answer to questions specially submitted to them by the judge, ■ found:
1. That it was a matter of public notoriety that Butterworth was a member of the firm, existing up to the 1st of March, 1855.
2. That it was a matter of public notoriety that the firm was changed on and after that date..
The plaintiffs requested the Court to charge:
1. That if they knew, by general report or otherwise, that for several years prior to the 1st of March, 1855, Butterworth was a partner, the latter was liable unless he proved “that the plaintiffs had notice of his- retirement or disconnection before they sold the goods.”
2. That it was his duty, either to prove actual notice of such disconnection, to the plaintiffs; or to have published it in some public newspaper in the city of New York; or in some other public and notorious manner put the public on their guard.
3. Unless the defendants had done- this, the plaintiffs must recover, unless before selling the goods, they had in some other way obtained knowledge of his retirement.
4. That knowledge by the plaintiffs, when they sold, of a change of the name of the firm from the Atlantic Forge Company, or Charles H. Tapper to C. H. Tapper & Lee, of itself gave no information to the public concerning the defendant Butterworth ; nor had that any tendency to show that he ever was a partner; or if he had been, that he had ceased to be one. The judge refused to charge, in respect to either request, otherwise than as he had charged, and the plaintiffs excepted, seriatim, to the several refusals to charge as thus requested.
Judgment having been entered on the verdict, the plaintiffs appealed from it to the General Term.
Thomas Nelson, for appellants.
I. Upon the dissolution of a partnership, the retiring partner, to exonerate himself from liability to the creditors of the continuing firm, for contracts entered into by them subsequent to his retirement, must give notice of his retirement. (Collyer on Partnership, §530.)
H. As to persons who have been in the habit of dealing with the firm, it is requisite that actual notice be brought home to them. (Collyer on Partnership, § 533; Clapp v. Rogers, 2 Kern., 283.)
III. As to all persons who have not had any previous dealings with the firm, a notice in one of the public and regular newspapers published in the (place where the business was carried on, is the usual mode of giving information, and should be given to exempt the retiring partner from liability for the future engagements of the continuing firm. (Collyer on Partnership, § 532, and notes, § 534; Lansing v. Gaine, 2 Johns. R., 304; Kitchen v. Clark, 6 id., 147; Graves v. Merry, 6 Cow., 704; Vernon v. Manhattan Co., 17 Wend., 527; 22 id., 193, 198; National Bank v. Norton, 1 Hill, 578; Munn v. Baker, 2 Stark., 255.)
IV. When a notice of the dissolution has not been published in a newspaper, or brought home to the knowledge of the party to be affected by it, evidence of the mere notoriety of the dissolution is not admissible to prove such notice. (Collyer on Partnership, §533; Pitcher v. Barrows, 17 Pick., 361; Gorham v. Thomson, Peake’s C., 42.)
Y. A dormant partner is liable after his retirement from the firm, to creditors who knew him as a member of the firm, if they were not notified of his retirement. (Davis v. Allen, 3 Comst., 168; Collyer, §536, and note 4; Kelly v. Hurlburt, 5 Cow. R., 534; Evans v. Drummond, 4 Esp., 90; Carter v. Whalley, 1 B. and Ad., 11; Grosvenor v. Loyd, 1 Metc., 19; Farrar v. Deflinne, 1 Car. and Kir., 580.)
"VI. Butterworth, in fact, was not a dormant partner. It is a well settled rule of law that a person is not to be deemed a dormant partner because his name does not appear in the firm and partnership style which they choose to adopt. (Goddard v. Pratt, 16 Pick., 428.)
VII. The plaintiffs had no knowledge of the change of the firm at the time they sold their goods; but even if they did, that fact furnished no presumption that Butterworth had ceased to be a partner, if he had not given sufficient notice of his retirement. Shaw, Ch. J., says: “When a business is carried on by three or more partners, and one withdraws, or one is added, or both, and notice thereof given, and the business is carried on as before, those as to whom no notice is given must be presumed to hold the same relation to the concern that they did before, and such change furnishes no presumption that the others have ceased to be partners.” (Howe v. Thayer, 17 Pick., 95.)
VIII. The giving of the note of C. H. Tupper & Lee to the plaintiffs was no payment of the plaintiffs’ claim. (Davis v. Allen, 3 Comst., 168; Vansteenburgh v. Hoffman, 15 Barb., 28.)
IX. The plaintiffs’ several exceptions to the charge made by the court, and its omissions to charge as requested, were well taken.
E. S. Van Winkle, for respondent.
I. The jury found as a fact that it was a matter of public notoriety that Butterworth ceased to be a member of the firm on the 1st of March, 1855.
The plaintiffs had never had any transactions with Butter-worth’s firm, and months after he had retired from it, sold to parties doing business under a different name a quantity of iron, for which they took the new firm’s note at six months.
The old firm was “The Atlantic Forge Company.” The new firm “C. H. Tupper & Lee.”
There was no error, therefore, in the Judge’s charge, that if they found such dissolution to have been a matter of public notoriety, the defendant, Butterworth, was not liable.
Where, on the trial of an action against three persons who had been in partnership together in Liverpool, but one of whom (Humble) had retired, it was proved that, upon his retirement, the new name of the firm was painted upon the counting-house, and the winding up of the affairs of the old partnership was removed to another .place’ in Liverpool, and circular letters1 announcing the change of partners were sent to the correspondents of the old firm, but there was no public advertisement of the change, nor any notice of it proved which could expressly affect the plaintiffs, the Court of King’s Bench held that these circumstances were a sufficient notification to all the world of the , change in the firm, and that the action was not maintainable against Humble. (McIver v. Humble, 16 East, 169.)
A change of the form of checks in a banking house, is, without any advertisement in the gazette or circular letter to customers, sufficient notice of an alteration of the firm to a creditor who uses such checks. (Barfoot v. Goodall, 3 Camp., 147.)
II. The rule is, that actual notice of the retirement of a partner is necessary to be given to the dealers with an established firm, in order to shield the retiring partner from liability for new engagements in the name of the firm, and that as to all other parties a publication in the newspaper is sufficient. But it is not held that such publication is the only means, but that any other facts inferring notice are enough, all the cases, however, have reference to new liabilities in the name of the old firm, not to new liabilities by a new firm or in a new manner, for that alone is notice. (Godfrey v. Turnbull, 1 Esp., 371; McIver v. Humble, and Barfoot v. Goodall, cited above; Clapp et al. v. Rogers et al., 2 Kern., 283; Vernon v. Manhattan Co., 22 Wend., 183; Graves v. Merry, 6 Cow., 701; Ketcham v. Clark, 6 Johns., 144.)
“ Public notice in some reasonable manner must be given.” A change in the business name seems the best notice, and one that cannot be overlooked.
See Parkin v. Carruthers, (3 Esp., 248,) where La Blanc lays stress on the point that the firm remained the same.
In Davis v. Allen et al., (3 Comst., 168,) “ The general principle is, that when a person has done business with another as a member of a firm, or has so publicly appeared as a partner, as to satisfy the jury that the plaintiff must have believed him to be such, and he suffers the plaintiff to continue in and act upon such belief, by omitting to give notice of his having ceased to be a partner after he really had ceased, he will be responsible for the consequences of his original representation uncontradicted by a subsequent notice.”
This means that when a person does business with another as a member of the firm, or does business with a firm in which the party has publicly appeared as a partner, so as to induce the dealer to believe he was such, although the plaintiff did not actually transact business with him, then he shall be liable.
The facts of the case and the context show this to be the meaning, and thus construed it is sound law; but if applied in favor of a stranger to dealings with the firm, it is not supported b^ any authority.
The'judgment should be affirmed, with costs.

Opinion:
Moncrief, J.,
delivered a written opinion, which, after stating the facts of the case, proceeds as follows:
Collyer on Partnership, section 530, states the rule to be, that "all the partners maybe bound, after the dissolution of the partnership, by a contract made by one partner in the usual course of business, and in the name of the firm, with a person who contracted on the faith of the partnership and had no notice of the dissolution. The principle on which this responsibility proceeds, is the negligence of the partners in leaving the world in ignorance of the fact of the dissolution, and leaving strangers to conclude that the partnership continued, and to bestow faith and confidence on the partnership name in consequence of. that belief; and where one of two innocent persons must suffer from giving a credit, he who has misled the confidence of the other, and has been the cause of the credit, either by his representation or his negligence or his fraud, ought to suffer instead of the other." Story on Partnership (§ 160) says: " Unless the ostensible partner, who has retired from the firm, suffers his name still to appear as one of the firm, so as to mislead the public, (as by its being stated and still remaining in the firm name,) he will not be liable to mere strangers who have no knowledge of the persons who compose the firm, for the future debts and liabilities, notwithstanding his omission to give public notice of his retirement, for it cannot be said in such cases that any credit is given to the retiring partner by such strangers. Every new creditor or new customer is bound to inquire who are the parties really interested at the time in the firm, if he would be safe in his credit and dealings with them."
All the cases cited in the argument are cases where an ostensible partner is sought to be held liable for a debt contracted in the old firm name; or by a dealer with such firm not having had notice of dissolution.
A dormant partner is only chargeable to third persons in respect of contracts entered into by the firm during the time he is actually a partner and is receiving the emoluments and profits of the business, for third persons have never trusted to his credit. The dormant partner is liable during that time, because he is in fact a contracting party, taking a part of the profits of such contracts ; but when he ceases to be in fact a partner, the reason ceases, and he is no longer liable. (Coll. on Part., § 536, 3d Am. ed.; 4 Esp., 89; 5 Cow., 534.)
The name of Butterworth never appeared as a member of either firm. He was known to have been the capitalist and interested'with Tupper as a member of the firm, doing business in the name of " The Atlantic Forge," and not otherwise. It was as a member of that house one of the plaintiffs had heard of him, and to which he claims to have given credit in this particular transaction. He cannot sustain such a claim, because he gave the credit either to C. H. Tupper, or C. H. Tupper & Lee, and for the reason that he had notice of a change in the name of the firm upon the receipt of the note. He had notice by the new sign with the new firm name thereon. He had notice by the new firm name signed' on the note received for the iron. (See 16 East., 169; 3 Camp., 147.) That was a clear, distinct and unmistakable notice. A fair presumption of actual notice can be raised from circumstances that will be sufficient. (1 Smith's L. C., p. 978, old p. 505.) As a matter of fact, it was not disputed that Butterworth was in no wise interested in business at Ho. 268 Eleventh street, after March 1, 1855. This transaction occurred seven months afterwards, (in October, 1855.) He cannot be held as a dormant partner, because he was not interested in its profits, and the partnership never did include him. He could not be held liable after his retirement, for the reason that the firm name did not include him, though that name had remained the same. (See Coll. on Part., § 536, pp. 488,489; 1 Barn. & Adol., 11; 5 Cow., 534; Story on Part., §159, 160, &c.; 1 Esp., 182.)
If it be true, as contended by the plaintiffs, that a liability against Butterworth could arise from the fact that he was somewhat .generally known, or reputed to have been a partner in business transacted at a particular place, then it should follow as a necessary consequence that his discharge could be shown by the same publicity or notoriety as to his disconnection or withdrawal prior to the making of the contract.
The jury found, as matter of fact, that it was a matter of public notoriety that the firm was changed on and after March 1, 1855; and it seems to me that the plaintiffs would be as much bound to hear what was said by public report or rumor, as they are supposed to see what may be published in a newspaper. Either method of conveying information is somewhat uncertain and dependent upon circumstances materially different from actual notice.
The other exceptions being thus disposed of, in this view of the case, it is unnecessary to consider the particular language of instruction to the jury. Even if erroneous, it could not affect the right of the defendant to judgment.
The judgment should be affirmed, with costs.
Hoffman, J.
This case has some particularities distinguishing it from the leading authorities upon the subject. The plaintiffs had not in any sense dealt with the old firm, of which Butterworth was a member. He was not then called upon to give actual notice of his retirement to persons who had not had transactions with the firm, much less with himself personally. Hor can the question arise, whether any degree of publicity by newspaper advertisement or circulars, could be, under any circumstances, a substitute for actual notice, as to previous dealers. (Clapp v. Rogers, 2 Kern., 283; Vernon v. The Manhattan Co., 22 Wend., 183; Graves v. Merry, 6 Cow., 701.)
Again, the case is not governed by authorities tending to show that as to subsequent dealers, a publication of a dissolution in newspapers printed in the place of business, would, under certain circumstances, be "sufficient. (Ketchum v. Clark, 6 Johns. R, 144; Collyer on Partnership, § 532 and note.) All that has been urged or cited upon these points appears to us inappropriate.
The case presents these important particulars. It was a matter of public notoriety that Butterworth was a member of the old firm up to the 1st of March, 1855. It is in proof that the plaintiffs heard of his connection with it as early as 1853, and had not heard of his retirement until after December, 1855, the period of the failure - of the new firm. One of the plaintiffs swears that he supposed Butterworth was a partner, when the sale of the iron was made. No advertisement of a dissolution was ever published. But the jury have found that it was matter of public notoriety, that the firm was changed after the 1st of March, 1855.
If the head note to Davis v. Allen, (3 Comst., 168,) is fully borne out by the decision, it would seem to involve the rule that when once knowledge of an existing partnership is possessed by a party actually, or is to be inferred from notoriety, notice of retirement must be traced to such party, or the partner will continue bound.
But the facts of the case show, that the plaintiff had worked for the firm from 1833 to 1843, and that Child, the defendant, was a partner from 1832 to some time in 1840. The work sued for was performed between the 1st of June and the 26th of November of that year, after the 'time when Child ceased to be a member.
The Court held that it must be inferred from the facts found by the referee, that Child was known to the plaintiff to have been a partner by direct transactions, or public notoriety. An omission to give notice of retirement was equivalent to a continued representation of his remaining a partner. »
"The report necessarily involves a finding that Child was thus known to the plaintiff," that is, as a partner and so known in one mode or the other, by direct transactions, or public notoriety.
Therefore, as the finding may have been that he was actually known, and through direct transactions, to be a member of the firm, the decision may justly be placed upon that ground. It is not a necessary consequence that if the source of information had been nothing but repute, actual notice of retirement would have been equally essential.
In Farrar v. Defflinne, (1 Carr. and Kir., 580,) the defendant and one Todd had been in partnership from 1834 to 1837. The defendant was a dormant partner; but much testimony was given to show that the plaintiff had been aware of his being a partner, and had not been made acquainted with the fact of his retirement. That had taken place before the claims sued upon arose. Cress-well, J., put it to the jury thus: The question for you is, was this partnership actually known to the plaintiff either by general report or by direct communication ? If it was, and he did not know, either from notice of the fact or from surmise, that the dissolution had taken place, you may infer that he still dealt on the faith of the partnership, and the defendant will therefore be liable. The plaintiff had dealt with the firm during the partnership, and afterwards. I think that the phrase " surmise " used by the learned judge may be treated as equivalent to "repute." Lord Kenton in Godfrey v. Turnbull, (1 Esp., 371,) where notice had been given in the Gazette, and the case was of a plaintiff who had not previously dealt with the firm, and the defendant had retired before the bill sued on was given, said: " If the dissolution be notified in the ordinary way, in the only way in which the fact of dissolution can be promulgated, (at least to those who have had no previous dealings with the partners,) it seems sufficient at least to be left to the j ury from thence to infer notice."
In the Tombeckbee Bank v. Dumell & Lyman, (5 Mason, 56,) it was held that a bill accepted after a dissolution, though drawn before, did not bind a retiring partner, who had announced the dissolution by a public advertisement at the place of business.
Dobbin v. Foster, (1 Carr. and Kir., 323,) was a case in which the retiring partner was originally bound to the plaintiff. Although his retirement was known, there was not enough to show a relinquishment of that original liability.
There is a marked line of distinction between cases of a previous dealing with a firm of which the party to be charged was known to be a partner, or of which dealing he received, or might have received a benefit in profits, and cases of a dealing for the first time after the party had retired, and the credit was ostensibly given only to the parties forming the new firm.
When a plaintiff rests only on the common notoriety of a person having been a partner, to make him liable for a contract made after his retirement, an equally common notoriety of retirement or dissolution must be sufficient to exonerate him. If without actual personal knowledge or actual dealing, the ground of notoriety can be presumptively sufficient to fix a responsibility upon a party, the same ground of general repute should operate in his favor, which operates, against him. This is the case before .us upon the verdict of the jury.
There remains one question. What is the effect of the evidence of one of the plaintiffs, that he supposed Butterworth continued a partner, when the sale "of the iron was made ?
It is apparent that the danger of receiving such evidence is great, especially since the admission of parties to testify on their own behalf. The defendant in such a case must be defenseless, unless he can prove actual notice of the dissolution brought home to the plaintiff.
The plaintiff, James H. Holdane, has not sworn that he made the bargain in this case, nor is there one word of corroborative evidence tending to show any reliance upon Butterworth's credit.
The judgment should be affirmed, with costs.
Bosworth, Oh. J.
The proposition is not controverted; that after the dissolution of a firm properly notified, no new contract by the continuing firm can bind the partner who retires.
A notice of dissolution published in the Gazette before a new contract is made, has been held to be an answer to an action by a person having no previous dealings with the firm, whether he' saw such notice or not. (Collyer on Part., p. 311, § III., Perkins' 3d ed., § 534.)
" Public notice, in some reasonable and sufficient manner, must be given, and that will conclude all persons who have had no previous dealings with the firm." (Ketcham & Black v. Clark, 6 J. R., 148.)
The jury found it was " a matter of public notoriety that the firm was changed on and after " the 1st of March, 1855. The plaintiffs' proposition to sell the iron in question was made by a letter dated the 8th of October, 1855. On the 10th they took for the iron a note made by "0. H. Tupper & Lee," the new firm. The firm of which Butter worth was a member, never did business in that name. When the new firm was formed an old tin sign on the front office was taken down and changed, and a new sign put up with the names "0. H. Tupper & Lee," thereon. Printed circulars stating the dissolution of the old firm and the formation of the new one, and who composed the latter, were sent by post to all who had dealt with the old firm. Butter-worth did not appear in the business, nor had he anything to do with it, after the dissolution of the old firm.
Tinder such circumstances, the fact that the dissolution of the old firm was a matter of public notoriety, should protect an out going partner, as against a person who never dealt with the old firm, and who, after the lapse of more than six months after the dissolution, sells goods to the new firm, and takes its note therefor, signed in the new firm's name, although he transacted the business with one who had been a member of the old firm.
Public notoriety of the fact of dissolution is sufficient notice to all persons who never dealt with the old firm.
It is an extravagant claim, when made by persons dealing with the new firm after the lapse of months from the time of its formation, and taking the note of the new firm, that the sale was made on the credit of the retiring partner, and on the faith that he was a member of the firm, especially when it is not pretended that he ever did business in that name, but on the contrary it is proved that the name of his firm was entirely different.
I think the facts proved entitled the defendant to a verdict and that the judgment should be affirmed.
Judgment affirmed.
Since the above cause was decided, the City Bank of Brooklyn v. McChesney et al., (20 N. Y., 240,) has been decided by the Court of Appeals. The latter case seems to hold that publication of a dissolution of a partnership in a newspaper, is requisite to protect the retiring partner from liability to one subsequently and in good faith taking a note made in the firm's name after such dissolution; although the person so taking it had not been a dealer with the firm, but had knowledge of its prior existence and not of its dissolution.
The reason why notice of the dissolution of a partnership published in " the Gazette in England," has been held a sufficient notice to those who have not dealt with the firm, whether
actually seen or not, as stated by Lord Abinger, C. B., in Hart v. Alexander, (7 Carr. & P., 746,) is that " the Gazette in England is the usual evidence of a dissolution of partnership, even against persons who are not proved to have read the Gazette at all, because a person, not knowing who may trust a firm hereafter, announc.es bis leaving it by an advertisement in the Gazette."
It is not intimated that publication of such a notice in any other newspaper, would be equally a protection to the retiring partner.
There is no particular newspaper in the city of New York, in which notices of dissolutions of partnerships are exclusively published, or in which it is expected they may be found. So that publication in a newspaper not taken by a person seeking to charge the retiring partner would not be likely to inform him of the withdrawal of such person from the firm.
If publication in a newspaper, though the publication be not seen and cannnot ordinarily be expected to be seen, is to protect a retiring partner, it must protect him on the ground, that such a notice is all that can be reasonably required, by persons who had not dealt with the firm during its existence.
If public notoriety of the dissolution of a partnership and of the formation of a new firm with a new partnership name, will not protect the retiring partner from liability to a person who had no previous dealings with the firm and who subsequently sells goods to the new firm and takes the note of the new firm therefor; then the only ground of exemption would seem to he (no notice of the dissolution having been published in any newspaper) that such person had actual notice of the retirement of the withdrawing partner; and the question of actual notice would seem to be one of fact, to he shown by direct evidence, or by circumstances that would justify a jury in inferring it. (Hart v. Alexander, 7 Carr. & P.; 746; Ketcham & Black v. Clark, 6 J. R., 146.) UA general notice, by advertisement or otherwise, should he sufficient for those who know the firm only by general reputation." (Verplanck, Senator. 22 Wend., 194.)
However, much doubt may be created as to the accuracy of the decision in Holdane v. Butterworth, by the case in 20 N. Y. R., 240; the questions involved are deemed of sufficient importance to justify the reporting of it. . . Rep.