Court Opinion

ID: 9702914
Source: CourtListenerOpinion
Date Created: 2023-08-25 23:31:45.154942+00
Date Added: 2024-06-11T18:21:43.472394
License: Public Domain

Haneman, J.
(dissenting). I disagree with my colleagues that the spouse of one partner should be permitted to maintain an action against the partnership for torts committed by her husband. The effect of the majority opinion is that for the purposes of such an action a partnership is to be regarded as a jural entity, separate and distinct from the individuals who compose the partnership.
The many facets of interspousal immunity from liability for torts have received much judicial attention in recent years. See Kennedy v. Camp, 14 N. J. 390 (1954); Koplik v. C. P. Trucking Corp., 27 N. J. 1 (1958); Tomkovich v. Public Service Coordinated Transport, 61 N. J. Super. 270 (App. Div. 1960).
*549Interspousal immunity is grounded upon the terms of B. S. 37:2-5, which reads:
“Nothing in this chapter contained shall enable a husband or wife to contract with or to sue each other, except as heretofore, and except as authorized by this chapter.”
In effect, the Legislature has, by this enactment, incorporated the common law into the statutory law. At common law one spouse could not sue the other in tort. The reason for this disability arose from the artificial and technical concept of the legal identity of husband and wife. The deleterious impact which such suits would have, if permitted, upon the home, the basic unit of organized society, Kennedy v. Camp, supra, 14 N. J., at p. 396, and the possibility of fraudulent and collusive actions because of the close and intimate relationship existing between husband and wife are additional reasons. Prosser, Torts, § 101, p. 677 (1955); Justice Jacobs’ dissent in Koplik v. C. P. Trucking Corp., supra; Annotation, 43 A. L. R. 2d 632, 663.
At common law a partnership had no existence separate and distinct from that of the individual partners. The partnership as such, was not a jural entity and legal actions concerning partnership matters could be maintained only against the individual partners. Actions may now, however, be maintained against the partnership without joinder of the individual partners. A judgment resulting from such a styled suit is binding only on the partnership and not on the paxtners in their individual capacities. X-L Liquors v. Taylor, 17 N. J. 444 (1955).
Partners are jointly and severally liable for the debts and obligations of the partnership. B. 8. 42:1-15, and the acts of the co-partners as far as these acts are within the scope of their agency for the partnership. B. 8. 42:1-13.
Although Felice v. Felice, 34 N. J. Super. 388 (App. Div. 1955), regarded the partnership as an entity for the purposes of determining the liability to an employee-wife of a partner under the Workmen’s Compensation Law, the *550court in Mazzuchelli v. Silberberg, 29 N. J. 15, said, at p. 24:
* * There the employee-wife of a partner was awarded compensation against the partnership as such. The result was a fair adjustment between a wife’s ancient inability to sue her husband for tortious injury and the statutory policy that the consequences of industrial injury be deemed to be a business expense.” (Emphasis supplied)
It is apparent, therefore, that the legal entity of a partnership was recognized in Felice only because of the supervening public policy concerning compensation for industrial injuries. Ho such public policy exists in the matter sub judice.
The court further said, in Mazzuchelli v. Silberberg, supra, in a well reasoned and comprehensive opinion reviewing the history of the Uniform Partnership Law, B. S. 42 :l-6 et seq., at p. 21, that while for some purposes the partnership should be regarded as an entity;
“But with respect to the subject here pertinent, to wit, liability for performance of obligations, contractual or other, including obligations to employees, the uniform law plainly did not adopt an entity theory.”
This constitutes a restatement of the common law philosophy and is presently applicable to actions in tort.
The principle as to whether a partner’s spouse may maintain an action grounded in tort against a partnership of which the spouse is a member has been decided by the highest courts of various states. Without exception these high courts have denied the right to maintain such an action. David v. David, 161 Md. 532, 157 A. 755, 81 A. L. R. 1100 (Ct. App. 1932); Caplan v. Caplan, 268 N. Y. 445, 198 N. E. 23, 101 A. L. R. 1223 (Ct. App. 1935); Karalis v. Karalis et al., 213 Minn. 31, 4 N. W. 2d 632 (Sup. Ct. 1942).
Prior to the Gaplan case the Hew York Court of Appeals, in Schubert v. August Schubert Wagon Co., 249 N. Y. 253, *551164 N. E. 42, 64 A. L. R. 293 (1928) sustained the wife’s right to sue her husband’s employer on the basis of her husband’s negligence, in spite of the right of the employer to a remedy over as against the husband. A similar result was attained in Hudson v. Gas Consumers’ Association, 123 N. J. L. 252 (E. & A. 1939). Both of these decisions were bottomed upon the theory that such action against the husband arose not by virtue of subrogation to the rights of the wife, the injured party, but rather out of the breach of an independent duty owed the employer. The wife’s action was therefore not the direct means of the employer’s suit. Interestingly, all of the judges who voted with the Chief Judge Cardozo in Schubert voted with the majority in Captan, emphasizing the continuation of the distinction between a suit by the wife of a partner against the partnership and a suit by the wife of an ordinary employee against the husband’s employer. The chronology of these two opinions strengthens the conclusion that the Uew York Court of Appeals knowingly and intentionally applied the interspousal immunity to partnerships in the face of a prior refusal to so do in an employer-employee relationship. If Captan and Schubert are in conflict then the later opinion, i. e., Captan, controls.
There is a real and not a fanciful distinction between a suit by a wife against a corporation in which her husband is a stockholder, even a majority stockholder, see Price v. Old Label Liquor Co., Inc., 23 N. J. Super. 165 (App. Div. 1952), and a suit between a wife and a partnership of which her husband is a partner. The corporation is an entity separate and distinct from a stockholder husband. Hot so with a partnership, as there is no merging of the members of a partnership into an artificial personality. A partnership is merely the sum total of the individual partners. Lewis v. Tilton, 64 Iowa 220, 19 N. W. 911 (Sup. Ct. 1884). Although it might be reasoned that both a judgment recovered by a wife against a corporation of which the husband is a stockholder and a judgment recovered by *552a wife against a partnership in which the husband is a partner, to some extent, affect the husband’s assets, it does not follow that we should conclude that such suits are of an identical nature; nor that such an eventuality should serve to demolish the common law prohibition against inter-spousal suits, recognized by the Legislature.
The rule in Gaplan was abrogated by the legislature of New York in 1937, 14 McKinney, Domestic Relations Law, § 357. At the same session in which that statute was enacted the New York legislature enacted the following statute:
“No policy or contract shall be deemed to insure against any liability of an insured because of death of or injuries to his or her spouse or because of injury to, or destruction of property of his or her spouse unless express provision relating specifically thereto is included in the policy.”
27 McKinney, Insurance Law, § 167, sub-sec. 3. The reasonable conclusion from these contemporaneously passed statutes is that the legislature was aware of the inherent danger of fraud and collusion in interspousal suits in instances where the husband shifts the actual recovery to an insurance carrier.
The same dictates of public policy which have been held to preclude persons standing in the relation of husband and wife from suing each other directly in tort should in all logic prevent either of them from maintaining such an action against a partnership of which the other is a member. Such an action could not have been maintained at common law. To sanction such action is permitting that to be done indirectly which is directed by legislative flat not to be done directly. The solution, if deemed required by public policy, should lie with the Legislature, since the prohibition of such suits is legislatively imposed. Furthermore, if we concede, as the cases have said, that suits in tort directly between husband and wife may serve to disrupt the family harmony, the same effect must eventuate from a suit which would *553involve that portion of the husband’s estate represented by his interest in the partnership. There could result a diminution in the value of his assets in either event. The distinction, if any exists, can at best be said to be only in the degree of such reduction. The very real danger of fraud and collusion in the face of the prevalence of liability insurance must be recognized. New York has pointed the way by the action of its legislature. I would not, by opinion of this court, without the power to restrict insurance coverage, open the door to promiscuous interspousal suits.
I would therefore affirm.
Hall, J., concurs in this dissent.
For reversal and remandment—Chief Justice Wbinteattb, and Justices Jacobs, Ebauois, Peootoe and Schettiho—5.
For affirmance—Justices Hall and Haneman—2.