Court Opinion

ID: 5585166
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:51:20.923236+00
Date Added: 2024-06-11T08:36:13.022503
License: Public Domain

Hill, J.,
concurring specially. I concur in the result reached by the majority of the court that a new trial should be granted, but for a different reason. I construe the contract to be one creating the sole relation of landlord and tenant, and not one creating two relations, as insisted by the majority, viz., landlord and tenant, and a partnership. The following reasons lead me to the above conclusion: There are many elements entering into partnerships, and various tests of determining whether a contract creates a partnership. In the contract here the question as to liability as to third parties need not be considered as one of the *33tests, because there are no creditors seeking to hold the parties to the contract liable as a partnership for the debts created under the contract. While the contract has some of the elements of a partnership, yet there staiid out strongly and prominently facts which constitute the contract as one between landlord and tenant. As clearly showing the relation of landlord and tenant, the following parts of the contract should be considered. It is expressly provided: “The said R. P. Jackson, party of the second part, shall have full and complete charge of the aforesaid Pinetucky plantation as tenant of same, and that the said Thomas A. Maynard is to receive as rental from the said R. P. Jackson the sum of $6600 per annum; then, after the payment of rental aforesaid, the sum total of all the expenses of the said farm shall be paid from the proceeds of the same; and after all expenses shall have, been paid, the net remainder of profits of said farm shall be equally divided between the said Maynard and said Jackson.” Here we have an express agreement and understanding that $6600 a year is to be paid and received “as rental.” Two expressions in the excerpt which are quoted from the contract reveal clearly the predominant purpose, which is to create a tenancy; and those are the expressions in which it is declared that Jackson is to take charge of the plantation in question “as tenant of the same,” and the amount of the rent that he is to pay is fixed'at $6600 a year. In placing Jackson in charge of the plantation as -tenant certain rights and privileges were conferred upon him that he would not have as a partner. A tenant so placed in possession of rented land has certain exclusive privileges that the owner of the lands can not interfere with, privileges of an exclusive nature which would not belong to one partner as against the other partner. In addition to this, without regard to the predominance of the 'fact that Jackson is liable in any one year for rental in the amount of $6600, because there is an unconditional agreement upon his part to pay this amount of rental, if at the end of the year when this $6600 became due he failed to pay the same, that amount being rent, the owner of the place would be entitled to sue out a distress warrant against this tenant; and the idea that the owner of the lands could sue out a distress warrant against the man in charge, and who claims to be a partner, is utterly inconsistent with the idea of a partnership. It is true that in the part of the contract *34which is set forth there is a provision that “after all the expenses of the said farm shall be paid from the proceeds of the same, and after all expenses shall have been paid, the net remainder of profits of said farm shall be equally divided between the said Maynard and said Jackson.” The expression “net remainder of profits” of course implies the idea of an interest in losses, and that is one of the features of a partnership contract; but standing out more prominently than this is the unconditional agreement to pay $6600 rental; and the further provision in this contract that the net remainder of the profits shall be divided has no other effect, in view of the controlling stipulation in the contract, than giving to the owner of the lands an additional rent if there are net profits. “The mere fact that one received a portion of the profits of a business as rent for premises used in the business does not therefore make him a partner in the business, where there is no mutual interest in the capital invested, and the share in the profits paid to the lessor is not given to him as proceeds of a joint venture by the parties, but piirely as rent to be paid for the use of the building.” 20 R. C. L. 843, § 48, citing Westcott v. Gilman, 170 Cal. 562 (150 Pac. 777, Ann. Cas. 1916E, 437); Thayer v. Augustine, 55 Mich. 187 (20 N. W. 898, 54 Am. R. 361).
It is true that we find in the contract the expression (after the stipulation that Jackson is to rent the farm)'that Jackson “will only use the credit of the Pinetucky Development Company except in the interest of the said farm, in erecting, altering, and repairing of all buildings, and that he shall have full and complete charge of all and all business connected with the property aforesaid that may prove of profit and value to the partnership created by this contract.” The fact that the contract between the parties is referred to in the document as a “partnership” does not tend to establish the claim that the entire contract creates a partnership. A partnership exists because of the relations created by the contract between the parties to the same, and not as a result of any name that is given to the enterprise. The use of the word “partnership” here has but little weight in determining whether or not such a relationship was actually created. Of course the stipulation that Jackson should “only use the credit of the Pinetucky Development Company except in the interest of 'the said farm, in erecting, altering, and repairing of all buildings,” and that he *35should “have full and complete charge of all business connected with the property aforesaid,” etc., is language that may be appropriate to a contract of partnership, but such language alone can no't give character to the contract under consideration. As we have pointed out above, the unconditional agreement to pay rent, and the vesting of Jackson with the rights of a tenant, are the clauses in the contract which stamp it indelibly with the features of a contract between landlord and tenant; and though it may be repeating, it is such a contract as between the parties to it, without regard to claims of third persons that may have arisen from engagements entered into with reference to the farm by Jackson, the tenant, under the authority with which he is vested in this contract. Jackson had no interest in the land involved, further than that “the said farm shall be considered to bear a present valuation of $110,000; and that in the event of the said lands increasing' in value during the period of life of this contract [twenty years], then the said Maynard and said Jackson shall share equally in the increased value of said farm, and all over the present valuation named, after the said Maynard, his heirs and assigns, and estate have been paid the present agreed value of said farm,” etc. This created merely a contingent interest in the enhanced value of the land at the expiration of twenty years; and in the event Jackson failed to pay the rent to Maynard, the latter still had the remedies in favor of a landlord against the tenant.
I am therefore of the opinion that the contract in the present case created the sole relationship of landlord and tenant as between the plaintiff and the defendant. Whether as to third parties there was a partnership existing under the contract need not be considered, as that question is not made in the case. Civil Code (1910), § 3158.