Court Opinion

ID: 6503262
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:15:47.691092+00
Date Added: 2024-06-11T15:54:40.004271
License: Public Domain

COLLIER, C. J.
It is stated as a general rule that in suits at law which concern a partnership, all the parties should join, but this rule undergoes or may undergo an exception in cases of dormant partners ; for it is at the option of the plaintiffs in such cases, either to join the dormant partner or omit him. [Story on Part. 350-1.] Another learned author, in his treatise on the law of Partnership, says it is not necessary that a dormant partner should join with the ostensible partners of a firm, in an action against a person who dealt only with the ostensible partners. [Collyer 393-4 , see also 2 Taunt. Rep. 324; 1 Esp. Rep. 468, 1 Chit. Plead. 12; Gow on Part. 128, 3d ed.; 10 B. & Cres. Rep. 671; 2 C. & Jerv. Rep. 133; 2 H. & Gill Rep. 159; 3 Cow. Rep. 84; 4 Id. 717 ; 3 Greenl. Rep. 409; 8 Sergt. & R. Rep. 55; 4 Wend. Rep. 628; 19 Id. 525; 2 Verm. Rep. 65; 5 Id. 116; 7 Id. 123; 9 Id. 407.]
In Lord v. Baldwin, 6 Pick. Rep. 348, the court said that .an action may be maintained by the ostensible partners without joining a dormant partner, against a person who dealt only with the ostensible partners ; and it is intimated that a dormant partner is one whose connection with the firm was unknown when the transaction took place, that if he was made known as a party to it, he would not be regarded as a secret partner. [See 5 Mason’s Rep. 176.] In Shropshire v. Shepperd, 3 Ala. Reg. 733, we say “ that it has been repeatedly held that it is not necessary a dormant partner should join with an ostensible partner in an action against a person who dealt only with the latter; and it. was added, that there was no evidence in the reeord that the defendant pur*606chased tfie goods (to recover the price of which this action was brought,) of the supposed dormant partner, as a tradesman carrying on a business in which he was interested, no such intendment could be made. It was held that the circuit court properly refused to charge the jury that he should have been joined as a plaintiff in tho action.
The cases cited, intimate in no equivocal terms that the defendant’s right of set-off cannot be materially affected, whether the suit is brought in the name of the partner only, who holds himself out to the world, or he joins with him a secret partner. [C. & P. Rep. 220; 4 B. & A. Rep. 437; 10 B. & C. 671.]
In my opinion the reason a dormant partner need not be made a party in an action for goods sold or other liability, is, because the contract is made with the ostensible party, and to him the promise inures. The ostensible partner stands in a different position from a mere agent without interest, who perhaps cannot sue upon a verbal promise — the right of action vesting in his principal as the legal beneficiary. But if the ostensible partner only, be known in the contract, he may sue alone, or the legal interest of the dormant partner will authorize a suit in their joint names. If however both the dormant and ostensible partners make themselves known, and become actors in making a contract, then they both become ostensible in respect to the party contracted with, and with no propriety of language can it be said that either of them, in such case, is a secret partner. Then the duty growing out of the contract inures to each — both are alike active, and all rights and obligations vest in, or devolve upon them united. But if this reasoning was less convincing to my mind than it is, I should long hesitate, before I would depart from even an arbitrary rule, sanctioned by the concurrence of all text-writers, and the uncontradicted dicta, at least, contained in many adjudged cases.
A majority of the court, however, consider the rule that a dormant partner is not compelled to join as a plaintiff, does not rest either on the fact that the person trading with the partnership has no knowledge that another is connected with the firm, or that he actually deals with the dormant partner, *607knowing the existence of the firm. If the rule was subject to variation on these grounds, it would certainly vary in its application, and the propriety of the suit would depend not on the fact that there was a dormant partner, but on other circumstances which might be concealed or disclosed at pleasure. In their judgment the rule is correctly stated in the citations from 1st Espinasse’s Reports. The opinion of my brethren controls, or rather overbalances mine; consequently the judgment of the county court is reversed, and the cause remanded.