Court Opinion

ID: 3621608
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:03:14.418307+00
Date Added: 2024-06-11T07:43:48.015514
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 310 
But a single question is involved in this appeal, which is whether a married woman who contracts a debt with her husband in a business carried on for their joint benefit can avoid liability for it on the ground of coverture. The second section of chapter 90 of the Laws of 1860, provides that: "A married woman may * * * carry on any trade or business * * * on her sole and separate account." It is urged that this language is not broad enough to authorize married women to engage in business as partners or jointly with others, or at least with their husbands, but that the statute simply confers power on them to contract by themselves and apart from others. This construction is too narrow and fails to express the evident intent of the legislature, which was not to prescribe the mode in which married women should carry on their business, but to free them from the restraints of the common law and permit them to engage in business in their own behalf as free from the control of their husbands as though unmarried. Before this statute, the profits of their business belonged to their husbands and the words "sole and separate account" were intended to convey the idea that the beneficial interest of any business in which they might engage belonged to them and not to their husbands. Since the enactment of this statute it has been held that husbands and wives may legally contract with each other in reference to their separate estates (Owen v. Cawley, 36 N.Y. 600; Bodine v. Killeen,
53 id. 93); that they may become agents for each other (Knapp v.Smith, 27 N.Y. 277), and that a husband may assign to his wife a chose in action (Seymour v. Fellows, 77 N.Y. 178).
In Frecking v. Rolland (53 N.Y. 422), it was held that a wife could not escape liability on a joint promissory note given by herself and her husband in payment for property purchased by her by reason of her coverture, nor by reason of the fact that she contracted jointly with her husband.
In Scott v. Conway (58 N.Y. 619), the defendant and her husband were engaged in running a theatre under the name of "Mrs. F.B. Conway's Brooklyn Theatre," pursuant to a *Page 313 
contract by which the profits and losses were to be equally shared between them. To an action brought for the recovery of the value of goods sold the wife interposed the defense that she was not liable for the debt, because it was not contracted in any trade or business carried on for her sole or separate account or benefit, but for the benefit of a business carried on by herself and husband for their joint benefit. This defense was overruled in the Supreme Court and in the Court of Appeals.
Bitter v. Rathman (61 N.Y. 512) was an action for an accounting between partners. The plaintiff, a married woman, had been engaged in business with the defendant under the name of H. Rathman  Co. The trial court found "that the plaintiff, in secret trust for her husband, was the partner of the defendant," and that "in respect to the public she was to be regarded as the real partner," and ordered an accounting as to the partnership affairs. GRAY, Commissioner, said: "Yet she, having suffered herself to be regarded by the public as a partner, was liable as such to the creditors of the ostensible firm; and having thus exposed herself to such liabilities, if any should be found to exist, she had to any such extent no right, as against either the defendant or her husband, to be protected out of the share which would belong to her in her capacity as trustee for her husband, at whose instance she undertook the trust." This case does not decide that a wife may or may not be a partner in business with her husband, but it, in effect, decides that a married woman may be a partner with a third person, and that her husband may act as her agent in the business of the firm.
In Noel v. Kinney (106 N.Y. 74; 15 Abb. [N.C.] 403), an action was brought against the husband and wife on a note signed "J.P. Kinney  Co.," payable to the plaintiff. The complaint charged that the defendants were liable as partners under the name signed to the note. The husband made default, but the wife answered that she was a married woman, and that the note was executed by her husband. On the trial the plaintiff put the note in evidence, and it appeared that the *Page 314 
defendants were husband and wife, and there was evidence that the note was given for mirrors placed in houses owned by the wife. A motion to dismiss the complaint on the ground that the note on its face showed that it was not given in respect to her separate business or her estate, was overruled. In considering this question DANFORTH, J., speaking for a unanimous court, said: "In the case cited (Frecking v. Rolland, 53 N.Y. 422), she became a joint contractor with her husband, but she was as much bound to perform the joint engagement as if the undertaking had been several, and she did not escape liability because her joint contractor was her husband. It was not necessary to inquire in that case whether the one paying could obtain contribution from the other, nor is it necessary to go into that question here. In that case both undertook to pay the creditor. Can it make a difference in the measure of liability that in one case the married woman entered in her own name and her husband in his name in the execution of a joint obligation, and in the other case adopted a name which represents a joint liability, which may, in effect, also be several? Partners are at once principals and agents — each represents the other — and if in the relation of partnership there are obligations which a married woman cannot enforce against her husband, or the husband against the wife, they involve no feature of the present action, which asserts only the obligation of a debtor to discharge her debt, or the obligation of a promissor to fulfill her promise."
Partners are the agents of each other and are jointly and severally liable for the debts of the firm, these being two of the essential elements of a contract partnership. It being settled that husbands and wives may be the agents of each other, and that they may bind themselves by joint contracts entered into with third persons, we see no warrant in the statute for exempting them from liability to creditors for debts incurred by firms of which they are members. It has been so held in Graff
v. Kinney (37 Hun, 405; 15 Abb. [N.C.] 397); Zimmermann v.Erhard (8 Daly, 311; 83 N.Y. 74). Opposed to these areChambovet v. Cagney (3 J.  S. 474); *Page 315 Kaufman v. Schoeffel (37 Hun, 140); Fairlee v.Bloomingdale (67 How. 292; 14 Abb. [N.C.] 341; 38 Hun, 230).
Upon principle and authority, we think that when a husband and wife assume to carry on a business as partners, and contract debts in the course of it, the wife cannot escape liability on the ground of coverture.
The judgment should be affirmed, with costs.