Court Opinion

ID: 7936448
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:10:06.257325+00
Date Added: 2024-06-11T16:33:33.557232
License: Public Domain

Montgomery, J.
(dissenting). The sole question in this case is whether the defendant was, as to the transactions out of which the claim of plaintiff arose, a partner of one Leclear.
Among the findings of fact by the circuit judge are the following:
“I find that there was no partnership in fact between Arthur Leclear and defendant. Said plaintiff was not employed to do said work and labor by the said defendant or for him, but said plaintiff was employed by one Arthur Leclear, and said work and labor was done for said Arthur Leclear. Said Leclear had no authority to hire or employ any person for defendant. Said Arthur Leclear and defendant were not partners in any business, and they did not hold.themselves out to the plaintiff or to the public, or to any one, as partners.”
The evidence is not returned, and no attempt has been made to present the question of whether the evidence supports the findings. It is insisted, however, that the Court may look into the other findings of the facts and *168circumstances, with a view to ascertaining whether the facts specifically found are conclusively inconsistent with the finding that there was no partnership in fact. The facts so found are the following:
The defendant was the owner of 840 acres of land in Charlevoix county, both the defendant and Leclear being residents of Kent county. An agreement was made in March, 1889, between Leclear and defendant, by the terms of which it was agreed that “ Leclear was to go on the defendant’s land, and cut logs and bolts, and market and sell and receive payment for the same. He was to pay the expenses of the job, pay the defendant 81.00 a thousand stumpage for logs, and 25 cents a cord for bolts. He was to furnish the use of a team, and defendant was to furnish the use of a team. Leclear was to have 820 a month for his services, and his wife was to have 83 a week for her services in boarding the men, and what was left was to be divided equally between defendant and Leclear as profits. The stumpage was to be paid first, and then the expenses of the job, including the pay of the men, were to be paid by Leclear; after that, he and his wife were to receive the above amounts, and balance, if any, divided as above. It was agreed that at any time when Leclear could not, from the proceeds of the logs and bolts, pay the expenses, he should cease further work under the contract.”
This was found to be the agreement under-' which the operations, were proceeding at the time the liability to plaintiff arose. I do not think that this finding is conclusively inconsistent with the finding that there Avas no partnership in fact between Leclear and defendant. If the terms of the agreement between the parties are to control the transaction, under no circumstances could Leclear, without violating the agreement, incur expenses which should become chargeable to the parties to the contract as partners. It was specifically agreed that, when Leclear could not pay the expenses, he should cease further work under the contract. The expenses of the job were to be paid by Leclear individually, and by the order of *169payment the stumpage was to be first paid, and his own and his wife^s wages were to be paid only in case there was a surplus after paying the workmen. The general finding imports that the parties did not intend a partnership, and it must be assumed that there was evidence to support this finding.
It is stated in Lindl. Partn. p. 10: “Whether an agreement creates a partnership or not depends on the real intention of the parties to it." See Pollard v. Stanton, 7 Ala. 761; Gray v. Gibson, 6 Mich. 300; Beecher v. Bush, 45 Id. 188. It is said, however, that, if parties have in fact stipulated for all the rights of partners, an agreement that they shall not be partners is a useless protest against the consequences of their real agreement; but a specific agreement negativing a partnership may throw light on other clauses, and rebut inferences which might be drawn from them alone. Lindl. Partn. p. 11. Generally, profit sharing is prima facie evidence of an agreement of a partnership, and, in cases where the contrary intention does not appear, undoubtedly evidence of profit sharing is sufficient to constitute the parties copartners. The same author further says:
“Indeed, it has often, been said that community of profit is the test of partnership. This, however, is not accurate. Whether persons are really partners or not is a question of intention, to be decided by a consideration of the whole agreement into which they have entered, and ought not to be made to turn on one or two only of the clauses in it."
In the well-considered case of Beecher v. Bush, 45 Mich. 193, it was said:
“If parties intend no partnership, the courts should give effect to their intent, unless somebody has been deceived by their acting, or assuming to act, as partners; and any such case must stand upon its peculiar facts, and upon special equities. It is nevertheless possible for parties to intend no partnership, and yet to form one. If *170they agree upon, an arrangement which is a partnership in fact, it is of no importance that they call it something else, or that they even expressly declare .that they are not to be partners. The law must declare what is the legal import of their agreements, and names go for nothing when the substance of the arrangement shows them to be inapplicable. But every doubtful case must be solved in favor of their intent; otherwise, we should 'carry the doctrine of constructive partnership so far as to render it a trap to the unwary.'”
And again, at page 200, it is said:
" In so far as the notion ever took hold of the judicial mind that the question of partnership or no partnership was to be settled by arbitrary tests it was erroneous and mischievous, and the proper corrective has been applied. Except when one allows the public or individual dealers to be deceived by the appearances of partnership when none exists,/he is never to be charged as a partner, unless by contract and with intent he has formed a relation in which the elements of partnership are to be found.”
Partnership is • a species of agency, and, where the parties to a contract do not themselves intend a partnership, it would seem, on principle, that the one who is unknown to those who deal 'with the others should be held only on the same ground that an undisclosed principal would be bound. This would preclude recovery in the present case, or in any case where the right of- an ostensible principal to contract on behalf of the other is negatived by the very terms of the contract; and cases are numerous in which this test has been applied. Cox v. Hickman, 8 H. L. Cas. 268; Eastman v. Clark, 53 N. H. 276; Dwinel v. Stone, 30 Me. 384; Clifton v. Howard, 89 Mo. 192 (1 S. W. Rep. 26); Newberger v. Friede, 23 Mo. App. 631. See, also, Morrison v. Cole, 30 Mich. 102; Runnels v. Moffat, 73 Id. 202; Murphy v. Craig, 76 Id. 155; St. Denis v. Saunders, 36 Id. 370.
In the present case the profits, over and above the stump-age and expenses of putting in the timber, were to be *171divided between defendant and Leelear; but it is distinctly found as a fact by tbe circuit judge that Leelear did not represent tbe defendant in doing tbis work, and the special facts found are not necessarily in conflict with tbis finding. Tbe whole control of tbe work was with Leelear. He was to collect all tbe proceeds of the sales, be was to pay all expenses, must cease work when be was unable to do this, and tbe facts are entirely consistent with an intent on tbe part of the parties that the division of tbe excess was as a measure of compensation for tbe stumpage value of tbe timber.
I think tbe finding below should be sustained, and tbe judgment affirmed.
Hooker, C. J., concurred with Montgomery, J.