Court Opinion

ID: 5462115
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:39:39.782147+00
Date Added: 2024-06-11T08:32:55.578317
License: Public Domain

By the Oourt, Gilbert, J.
The issue tried was between the plaintiff and the defendants named as executors of Mr. Schleicher, deceased; and arose upon a denial of the allegation in the complaint that the plaintiffs sold and delivered coal to the defendants, at various dates between 20th June, 1866, and 1st of October, 1866, at an agreed price therein stated. The evidence showed a sale in fact of most of the coal to a partnership composed of the defendant Perzel and the deceased Mr. Schleicher, and a portion thereof to the surviving partner, after the death of the latter. It was sought, however, to make the executors of Mr. Schleicher liable on the ground that they had carried on the partnership business in connectiomwith the surviving partner, after the death of their testator. The court below deemed the evidence insufficient to establish this fact, and dismissed the complaint. Upon a review *311of the evidence wé are satisfied that this ruling was correct. The material facts are these: ■ The partnership between Mr. Perzel and the testator was formed for the manufacture of woolen goods, and was to continue until October 2,1870. The articles provided that, in case of the death of Mr. Schleicher, the capital contributed by him, being $20,000, should remain for the benefit of Ms representatives, and the business should be continued until the expiration of the term. Mr. Schleicher died July 17,1866. The defendants qualified as executors on the 17th of September, following. Mr. Perzel, the surviving partner, was called as a witness, by the plaintiff and testified that the sign put out, on commencing business, was “ Pioneer "Woolen Mills;” that he continued the business up to October 5, 1866, and bought coal of the plaintiff and others, and whatever was required to carry on the establishment, after Mr. Schleicher’s death.
The plaintiff' testified that on the 16th or 17th of September, 1866, he went to see the executors, to know what he had to do about delivering coal at the factory; that Mr. Poppenhusen referred him to Mr. Van Auw; that he told Mr. Van Auw he had a contract with Mr. Schleicher to deliver coal for the Pioneer Woolen Mills; and asked him what he had to do as to the delivery of any more coal there, and that he had been advised not to deliver on Perzel’s order. He further testified: “Mr. Van Auw told me, ‘ the business is going on just the same; we are going on with the business there just the same as before Mr. Schleicher’s death;’ he wanted me to go on and deliver coal, only to be very careful that I only delivered what was wanted; that I should be paid, but that he would not pay any thing before the estate was settled. After that, I went on and delivered coal; the amount so delivered was about one third of the coal sued for.” Two other witnesses testified to sales of goods to the firm of John Gk Perzel, after the death of Mr. Schleicher; and that after *312suits against the surviving partner and" the executors were brought, the hills were paid by work at the mills. This was all the evidence connecting the executors with the business carried on after the death of Mr. Schleicher, and we are of opinion that it is insufficient to make them liable as partners. To create such a liability, it is necessary to show that they voluntarily employed the testator’s assets which had come to them, in the trade.
It is not sufficient that the business is carried’ on by the surviving partner, with their assent and encouragement; for it was his right and duty to do so, without either. The surviving partner succeeded, primarily, to the rights and interests of the partnership. He had the entire control of the partnership property, and the sole right to collect the partnership dues. (Voorhis v. Childs’ Executor, 17 N. Y. Rep. 356.) Nor do executors incur any responsibility by allowing the share of the capital of the testator to remain in, and be employed in, the business of the partnership, after his death, for the benefit of the cestuis que trust, when it is done in accordance with the testator’s instructions, contained in his will, or with the partnership agreement; but the assets so directed to be employed are liable to make good the debts contracted during their employment.
To this extent the estate of a deceased partner will, in equity, be applicable to the liquidation of the demands of those who have become creditors of the partnership after his decease. (Devaynes v. Noble, 1 Mer. 616, 622. Vulhamy v. Noble, 3 id. 614. Whightman v. Townroe, 1 M. & S. 412. Ex parte Garland, 10 Vesey, 119. Ex parte Holdsworth, 1 M. D. & D. 475. Thompson v. Andrews, 18 K. 116. Cutbush v. Cutbush, 1 Beav. 184. Thompson v. Brown, 4 John. Ch. 627. Story on Part. § 70.)
The executors, however, cannot be made liable personally, without entering into the partnership. When this is done, then they become liable as partners, although they derive no profit personally, but are concerned only *313for the use and benefit of others; and this liability arises either by virtue of an actual agreement, or upon the familiar principle that they have held themselves out to the world as partners.
[Kings General Term,
February 14, 1870.
We have looked into the other exceptions, but find no error in the rulings of the court. The evidence rejected, however relevant to establish grounds of equitable relief, was wholly impertinent to the issue presented for trial.
The judgment should be affirmed, with costs.
J. 1K Barnard, Tauten and Gillei-t, Justices.]