Court Opinion

ID: 3553129
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:05:06.734427+00
Date Added: 2024-06-11T09:27:02.812732
License: Public Domain

The question presented for decision is, whether, under the circumstances of this case, the partial payment made by Kimball, after the dissolution of the partnership, will take the case out of the operation of the statute of limitations.
I. It seems to be well settled, although there are some conflicting authorities, that the admissions of one partner, made after a dissolution of the partnership, is competent evidence against the firm, as to any contract made prior to such dissolution. Mann v.Locke, 11 N. H. Rep. 246, and various authorities there cited; 1 Greenl. Ev., § 174, and note 3.
The power of one partner, by an acknowledgment of the debt, after a dissolution, to take the case out of the statute, as to the others, is referred to in Mann v. Locke, as an exception to the above rule.
But that case did not require the decision of that question, and the court do not undertake to decide it, nor do the authorities referred to by the court, to support the general doctrine decided in that case, seem to support the exception referred to.
As we understand it, the question of the power of one partner to take a case out of the statute, is an open one in this State.
In some respects, this question as to partners would seem to stand upon a different footing from that of other joint VOL. XXX. 10 *Page 138 
debtors. And an acknowledgment by one co-partner of a partnership debt, would not seem to be within the mischief adverted to by LordEllenborough, in Brandon v. Wharton, 1 Barn.  Ald. 463, and inExeter Bank v. Sullivan, 6 N. H. Rep., of a payment by one of several joint debtors, who might have lost the evidence of such payment, and therefore made liable by the promise of another, to whom the payment was not known.
The nature of partnership transactions, the fact that all the partners are in intimate connection with their business, makes a debt from the firm nearly the same as though it was due but from one person. And it could hardly seem probable that a debt could be paid by one co-partner, without a knowledge of it by the other.
The case of Bell v. Morrison, 1 Peters 371, is considerably relied upon in support of the doctrine that the acknowledgment of one partner is not sufficient to take a case out of the statute of limitations. But in that case, the court were not unanimous in their opinion, and it was principally decided in reference to the local decisions of Kentucky, though Judge Story goes into general considerations in support of the doctrine, taking the ground that an admission or acknowledgment, after a debt is barred by the statute, constituted a new contract, and therefore not sufficient, when made by one partner, against his co-partners, after dissolution. Cady v. Shepherd, 11 Pick. 400; Vinal v. Burrill, 16 Pick. 401; Bridge v. Gray, 14 Pick. 61; Sigourny v. Drury, 14 Pick. 387;Austin v. Bustwick, 9 Conn. 498; Parker v. Merrill, 6 Greenl. 47;Greenleaf v. Quincy, 3 Fairf. 11; White v. Hale, 3 Pick. 291;Shelton v. Coke, 3 Mumf. 191; Smith v. Ludlow, 6 Johns. 297; Collyer on Part. 3d Am. ed., p. 236, and note.
Mr. Greenleaf, in his note to sec. 113 of Greenleaf Ev. says that "other judges have viewed such admissions, not as going to create a new contract, but a new acknowledgment of a continued existence of a debt previously created," *Page 139 
thereby repelling the presumption of payment by the lapse of time, and thus taking the case out of the operation of the statute of limitations; and he cites some of the above authorities, and various others.
This would seem to be the better doctrine; for it is not easy to see, if such acknowledgment is a new contract, as argued by JudgeStory, why no new consideration is necessary to support it.
According to Judge Story's doctrine, although the debt is "extinct," and the "old consideration gone," requiring a new contract to give it vitality, still the original consideration, although "gone," is sufficient to support the new contract!
II. But this case does not present the naked question of the power ofone partner, after a dissolution, and after a claim had been barred by the statute of limitations, to take the case out of the statute by his separate admission.
This claim was not barred by the statute at the time of the dissolution, nor when the acknowledgment, by a part payment, was made by Kimball. The payment on the first note, made January 20, 1844, and on the second note, made March 13, 1844, was within six years from the date of the notes, and the suit was brought within six years thereafter.
The case, then, stands upon the same ground as other admissions and declarations of one partner after the dissolution, in relation to any other copartnership matter or contract, made and in existence prior to the dissolution, (Mann v. Locke,) and is clearly within the principle of those cases which hold that an admission by one partner, before the statute has attached, is sufficient to bind the other partners.Fisher v. Tucker, 1 McCord's Ch. Rep. 175; 1 Greenl. Ev. note 3 to § 174.
It would seem to come, also, within the principle decided inSmith v. Ludlow, 6 Johns. 297, as recognized by Judge Story himself, in his opinion in Bell v. Morrison, that the partner making the promise might, in some cases, be the *Page 140 
agent to settle the affairs of the firm, and in that capacity make an acknowledgment which would avoid the statute of limitations.
The case finds that the debt was a partnership debt. That is admitted. It was a debt due when the firm of Kimball  Paige was dissolved, and the statute of limitations had not at that time, nor has it at any time, run against it. Kimball, by the terms of the dissolution, was made agent to pay the debts and close the affairs of the firm; and Paige took a bond of indemnity to secure himself against all the debts of the firm, including, of course, the one in suit. If he is obliged to pay any of the debts of the firm, he has his remedy against Kimball, on his bond. It was a present, existing debt, which the firm were bound to pay, and it was clearly within the scope of Kimball's authority, as agent of the firm, to make the payments which he made on the notes, and thus prevent the statute of limitations from attaching to the debt. A payment in part is a sufficient acknowledgment of the debt to take the case out of the statute. Jones v. Jones, 1 Foster's Rep. 222. The plaintiff could have no separate remedy against Kimball. Both parties must be sued.Cady v. Shepherd, 11 Pick, 407, and Mann v. Locke.
If, then, the admissions of one partner, in relation to contracts made during its existence are binding upon the firm, and, as is said inMann v. Locke, "the rule, in this respect, is precisely the same after a dissolution of the partnership as before," it is a little difficult to see how the admissions of Kimball, in this case, can constitute an exception to that rule. Cox v. Bailey, in Sup. Court of Georgia, reported in N. Y. Law Magazine, Jan. 1853.