Court Opinion

ID: 4891897
Source: CourtListenerOpinion
Date Created: 2021-09-02 23:51:21.162151+00
Date Added: 2024-06-11T08:09:42.067607
License: Public Domain

McAdoo, J.,
on rehearing.—On a full rehearing and careful reconsideration of this case, we are satisfied that ‘ the former judgment in the case should be set aside and a different judgment rendered. In the former decision we treated the draft sued on as belonging to the assets of the firm of Brantly & Nations, and transferred by endorsement, after the dissolution of the partnership and *198death of Brantly, by the surviving partner, James Nations.
The evidence clearly shows that the draft formed no part of the assets of Brantly & Nations; that it was drawn after the dissolution of the partnership and death of Brantly, not to pay a debt due from the drawers to Brantly & Nations, but that it was drawn by Cavitt and J. M. Nations and J. T. Nations, and endorsed by James Nations, for the purpose of paying off, to the plaintiffs in the court below, a debt due them by the late firm of Brantly & Nations; the name of Brantly & Nations being used as payees, rather in the nature of fictitious payees than beneficiaries of the draft.
Upon the execution and delivery of this draft to the agents of James & Co., the evidences of debt from Brantly & Nations to them were surrendered to James Nations, the surviving partner. In short, this was a new contract entered into by the drawers and endorsers of the draft in discharge of obligations pre-existing, for which James Nations was bound.
It appears to have been well understood by all the parties at the time that the endorsement of the- name of Brantly & Nations did not bind the firm, now no. longer in existence.
. Aside from the testimony of Lewis, which is specific on this point and is uncontradicted, why did James Nations, the surviving partner, endorse the draft? If the endorsement by the firm, of which he had been a member, bound the firm, it certainly bound him as a member ' of it. And besides, this suit does not affect the partnership effects of Brantly & Nations, nor the estate of Brantly; for neither Brantly’s administrator, if he has any, nor his heirs are made parties.
Taking into view the facts connected with the history of this transaction, we think the legal status of the in*199strument sued on is equivalent to a promise in writing of James Nations and the drawers to pay a debt for which James Nations was bound, in consideration of an extension of time for the payment of the debt.
It is certain that all the parties to the transaction knew that at the time when the instrument was drawn there was no fund then in the hands of the drawee with which to discharge it. With this knowledge, protest and notice even were unnecessary.
Had this draft been drawn and delivered to Brantly & Nations during the existence of that partnership, and belonged to them, the surviving partner could not by an endorsement of it, in the partnership name or otherwise, have transferred or put it into circulation, in order to bind all the parties. (Story on Partnership, Sec. 322; 3 Kent’s Com., 63; White v. Tudor, 24 Texas, 639; Speake v. White, 14 Texas, 369.)
This rule is intended to put it out of the power of a continuing partner in business to charge a retiring partner by negotiating bills given during the partnership.
If the use of the firm name of Brantly & Nations, as previously indicated, as payees and endorsers, was merely ficticious, then the draft would have the same effect and validity as if made payable to bearer. (Story on Bills, Sec. 200.)
It seems to us, that to permit the real obligors in this case to escape liability, under all the circumstances of the transaction, through a mere technical rule, even if appliable in this case, where an honest debt had thereby been canceled and the evidence of it surrendered, would be grossly inequitable and unjust.
There Were errors committed in the court below, which must reverse this case. One alone is sufficient.
Interrogatories were filed by the defendants in the court below to each one of the plaintiffs; but only one of *200. the plaintiffs-answered. The answer of that one should not have been permitted to have been read, upon objection, by the defendants, in the absence of answers by the others.
The cause is reversed and remanded.
Reversed and remanded.