Court Opinion

ID: 5142668
Source: CourtListenerOpinion
Date Created: 2022-01-01 17:20:17.741738+00
Date Added: 2024-06-11T08:24:37.657897
License: Public Domain

Thomas, J.,
Partnership. Agency. Under the facts in this case, the appellee and J. A. Skaggs were partners. Singleton was to do nothing but furnish the money, and Skaggs was to buy and sell, and divide the profit equally with Singleton. This constituted them partners. Mr. Bates, in his work on Partnership (volume 1. p. 48, § 35), says; “Where A. contributes services in collecting and buying hogs and cattle, and B. furnishes the capital, profits to be divided, nothing being said about losses, there is a community of profits, and therefore a partnership, and A. cannot sue B. at law for his share. B. advanced §20,000 to H., to invest in the purchase and sale of cotton goods; H. to attend to business, and, after repaying the money, divide the profits equally. Beal estate was bought with part of the proceeds, and the title taken in H. ’s name. There was held to be a partnership inter se, and a loss must fall upon both. So, where S. gave N. $300 to buy sheep, S. to have half the profits, and if there were losses he was to have no interest, this is a partnership inter se, not merely in the profits, but in the $300.” In Dob vs Halsey, 8 Am. Dec. 293, it was held; “Where one *520furnishes the capital for an undertaking, and another puts in his services in consideration of a share of the profits, indefinitely, there is a partnership between them as regards the parties themselves, as well as third persons.” See, also Miller vs Hughes, 10 Am. Dec. 719; Bromley vs Elliot, 75 Am. Dec. 182; Leggett vs Hyde, 58 N. Y. 272. The court, in the case of Miller vs Hughes, above cited, in passing upon the power of one partner to- bind another by private agreement between themselves, uses the following language; “That was a matter that concerned themselves only, and could not - affect a contract made with any other; for as partners have equal authority over their partnership affairs, it would be preposterous to suppose that either of them could by such instructions limit the power of the other to bind him. ” In the same case a partnership is defined to be a voluntary contract between two or m ore persons for joining together their -money, goods, or labor, upon an agreement that their gain or loss shall be divided proportionately; and whether each contributes money or labor, or both money and labor, or, as in the present case, one finds money and the other labor, still it is equally a partnership. The fact that there was no agreement between Singleton and Skaggs that Skaggs should be liable to sustain a proportion of the loss, if any should happen in the course of trade, constitutes them none the less partners. As Skaggs was entitled to a share of the profits, it follows as -a legal consequence that he must share the loss. The rule in this respect is that one who shares in the advantages must also share in the disadvantages of the partnership concern. Miller vs Hughes, supra. Skaggs entered into an arrangement with Henry whereby he was to divide his half of the profits with him. This arrangement was known to Singleton. Skaggs was the active member of the copartnership-. Few persons, if any, in the neighborhood, outside of the bank through which he and Singleton conducted their busi*521ness, knew Singleton in the business at all. Singleton’s ■home was in Fredonia, Kan., several miles away from where this business was being conducted. He furnished the capital with which to carry on the business, and the practical management of it was turned over to J. A. Skaggs. That the members of a partnership are bound by the action of one of its members in the employment of servants and employees for the purpose of carrying on the partnership business is well established. 1 ‘Each partner in the prosecution of the business has implied power to employ labor or engage services such as are necessary to conduct the ordinary business of joint enterprise.” 1 Bates, Partn. § 334, and cases cited. The testimony shows that the cattle were purchased originally from Charles Bruner; that at the time of the purchase Skaggs and Henry went to the house of Charles Bruner, and contracted with him for the purchase of the same; that the cattle were left in the pasture of Bruner for some time after they were purchased. And Bruner testified that he did not know Singleton in the transaction; that he told them he would not be responsible, as he was going to be away from home, and Skaggs said he or Henry would be around there to look after the cattle; that the cattle were taken away while he was absent from home; and that Henry afterwards paid him for the pasturage of the cattle. The testimony of a number of other witnesses was offered to show that Skaggs and Henry were buying and selling cattle in the neighborhood, and were generally regarded as partners. The trial court ruled that this testimony was not proper until defendant had first established that Henry was Singleton’s agent. We think that the question of whether Henry’s relations to the business were such as to constitute him a partner of Skaggs, or an agent of the partnership, should have been submitted to the jury, under proper instructions, and that it was error for the court to direct a verdict for the plaintiff. In Bromley vs Elliot, 75 Am. Dec. 183, it was held “that a person *522who receives a share of business profits by way of salary or compensation for service is liable as a partner to third persons, unless the true character of the agreement is known, or the apparent relations of the parties are such as should put parties dealing with them upon inquiry.” If a wrong has been committed in this case, it was occasioned by the appellee, and, if it be claimed for him that he was innocent of the transaction in question he stands upon no higher ground than the appellant; and where one of two innocent parties must suffer, every principle of right and justice would suggest that it should be the one who made the commission'of the wrong possible, — the one who placed the power in the hands of the man who actually committed the wrong. “Where one person clothes another with all the indicia of ownership of personal property, he is bound by the act of such person, even though it be contrary to his instructions.’ Carmichael vs Buck, 70 Am. Dec. 226; Mowrey vs Walsh, 8 Cow. 238; Rosser vs Darden (Ga.) 7 S. E. 919, 14 Am. St. Rep. 152; Steamboat Co vs Scudder, 67 U. S. 372, 17 L. Ed. 282; Saltus vs Everett, 20 Wend. 267; 2 Herm. Estop. § 978. Mr. Herman, in his work on Estoppel and Res Judicata, in the section above quoted, says: “Where the owner holds out another or allows him to appear as the owner of, or as having full power of disposition over, the property, and innocent third parties are led into dealing with such apparent owner, they will be protected. Their rights in such cases do not depend upon the actual title or authority of the party, with whom they deal directly, but are derived from the act of the real owner, which precludes him from disputing, as against them, the existence of the title or power which, through negligence or mistaken confidence, he caused or allowed to appear to be vested in the party making the sale or conveyance. Possession of personal property is prima facie evidence of title. It would furnish fraudulent parties with the means of defrauding *523honest purchasers to intrust them with the apparent ownership of property, while the real title is allowed to remain in a third party, who can reclaim it at pleasure.” We are therefore of opinion that there is error in theflrecord, and that the appellant was entitled to a new trial. The case is therefore reversed, with directions to the court below to set aside the judgment and grant a new trial. Reversed and remanded.
Clayton, C.' J., and Townsend and Gill, JJ., concur.