Kemper v. Smith
Kemper v. Smith
Opinion of the Court
delivered the opinion of the Court.
While the parties were partners in trade, the plaintiff bought a certain tract of land, first by an act under private signature in the name of the firm, and afterwards by a. public act purporting in "the body of it to be a purchase on hi.-, own private account, though signed by him in the name of the firm. A liquidation of the business of their concern being afterwards sued for, by the defendant before the Spanish Governor of Baton-Rouge, within whose district their commercial house was established, a .course of proceedings was there had, during which the land in question was adjudicated for the appraised value to the defendant, now the appellant.
The first question, therefore, to be disposed of is whether this adjudication ought to be considered as res judicata ; and first, before any enquiry into its validity, whether the judgment rendered in that case is final or still open.
On the 20th of August, 1803, Governor Grandpre rendered his judgment confirming a report of referees, which after having charged the appellant with the full value of the land now in dispute, established a balance in his favor. This judgment was notified to the appellee on the 27th of the same month, and on the 30th he presented to governor Grandpre a petition, in which he complains of the award, and begs leave to bring the whole case before the Superior Court sitting nt New-Orleans. Here then is an appeal in substance and in words, claimed within the legal delay: So that supposing this to have been a definitive
This last decree amounting to a denial of* the appeal at that time, the appellee, unwilling to proceed any further in that Court, came directly before the superior of Governor Grandpre with a memorial stating his grievances, and a decree ordering some of the documents annexed to his petition to be translated, shews that his complaint was admitted. Since then nothing appears to have been doiie in the suit, so that if Governor Grand-pre’s decree was not final as he himself seemed to consider it, the case remained opened in his Court ; and if it was final, it remained open in the court of the Governor-General of Louisiana by virtue both of the petition of appeal, and of the application of the appellee there. In either case we must say that the decree of Governor Grandpre cannot' be considered as having the force of the thing judged, and is consequently no bar to the appel-lee’s claim.
v Dismissing, therefore, that question, we now come to the merits of the case. Is the land here claimed the property of the appellee alone, or the joint property of him and his partner ?
By a private bill of sale dated September 29th 1799, the appellee bought the land in dispute for the account of the partnership in the absence of his partner. Under that title he took possession of the land and proceeded to improve it. But having received (it does not appear when) a letter from his partner, dated Cincinnatti, the l9th August of the same year, in which he told the appellee not to engage any land for him, the appellee, on the 25th ofMárch 1800, caused the vendor óf the land in question to make him a publi.c act of sale of it in his separate and individual name.. Upon this last act he claims title as the sole purchaser of the land.
In' support of this claim he alledges, that by the articles of the Co-partnership,1 entered into between him and the appellant John Smith, no right
The first fact to be ascertained is whether by the articles of copartnership the appeilee was au-thorised to purchase for the firm any o her property than that which is usually received in payment of merchandize sold. A phrase in those articles has been tortured to make it signify that the appellee had such a right. It is this : “ the “ said merchandize shall be sold to the best advantage for cotton or other commutable ar- “ tides, or cash, as the acting partner may in his “ judgment deem advantageous.” The words commutable articles, it is said, must include every thing that may be the object of comm ree, and of •Course real property as well as any other. But
By the articles of copartnership, then, the appellee had no right to buy real property for the firm. Yet he did so ; What is to be the conse
Admitting, therefore, the purchase made by the appellee in the name of the partnership to be nothing more, with respect to the share of John Smith, than a purchase made by a person having no authority to buy, his right to accept it stood unimpaired, when the appellee undertook to destroy that sale.
But the appellee, although by the articles no, power was given to him to acquire for the partnership other property than that which he. was to, receive in the course of his trade, cannot be deemed to have been entirely destitute of any authority to act as he has done. Independent of any written stipulations, a partner, like a proxy, may be considered as tacitly vested with a discretionary power to do ail things necessary to enable him the better to carry on the business which he has to manage. If the partner is in the situation of 3 proly with respect to his right to bind his partnee,
In this case it is evident from the conduct and correspondence of the appellee that there existed between the parties some understanding as to the exercise of such discretionary power. The principal produce for which they could sell their goods was cotton ; it was more profitable to buy it in the seed, hence the propriety of establishing a gin: hence the necessity of buying a place whereon to build it. The appellee bought on very moderate terms a tract of land advantageously situated, where a store could be kept and a gin be erected. He bought mules to, work at the gin ; he bought a slave for the service of the store, and actually improved the place with thd funds' of the partnership. Had he no power or authority to do all this ? If that power and authority can be denied^ surely it is not by him, whose conduct evidently shows that he considered hinasélf as sufficiently authorised for those purposes.
.Upon the whole we are of opinion, that under the private sale of the land in dispute in favor of
Ir is, therefore, adjudged and decreed that the judgment of the District Court be reversed, and that judgment be entered for the appellee for one7 undivided moiety of the land by him claimed..
Duncan and -Livingston offered the following argument for a rehearing.
To shew that the plaintiff could legally cancel the'contract of sale under private signature from Duplantier to R. Kemper & Co. and receive in return a Sale of the land to himself individually, he begs leave to make the following points :
I.' No man can contract for another, unless he be authorised so to do. Kemper and Smith were partners, but this contract of sale was. out of the partnership concern, therefore there could be no authority thence for the 'contract, apd no other authority is pretended ; therefore^ the ' act itself, so
II. Aman in contracting for another without obligation so to do, or any authority whatever from the other, cannot affect the interests of the other; nor can he bind himself thereby to the' other, for it is a mere voluntary act, and ex ñudo pacto nonpritur actio ; see Powell on Contracts, 338 to 343 : Pothier on Contracts, 5, which if it were binding, might be revoked as long as it remained unaccepted. '
JII. That the defendant, Smith, could only avail himself of his purchase while the contract remain-, ed in existence: for he might make that his contract which was not his previously, but Kemper’s; the plaintiff not having been obligated to purchase for Smith, incurring no obligation either to keep the contract opened for Smith’s acceptance; having annulled it, Smith cannot then avail himself of it. His right is not destroyed, for he had none. Suppose a right, where was the refttedy ? Nota-gainst the vendor, for Smith was not bound, and there existed no contract between him and the vendor ; not against the plaintiff, for he neither was bound in law nor conscience to buy for Smith, or to hold for him.
V. But in this case, the dissent of Smith was fully expressed. Smith’s letter to the plaintiff, dated 25th August, 1799, although the writer does not apply it to any particular purchase, is clearly applicable to all purchases. .There is no peculiarity in the purchase of the land in question that could distinguish it. A caution beforehand not to buy, is a dissent to all purchases ; and his reasons for dissenting existed for all, and applied equally for any; he wished to realize all the partnership’s funds to make remittances to Philadelphia, to put the concern in such situation as to be closed, if he thought proper. Immediately on his arrival, he gives preparatory notice to dissolve, he expressly tells the plaintiff to make no further purchases from.
1. From the design and spirit, of the letter, which would controul any restricted meaning of words loosely used.
2. From Smith’s own construction of this letter, as appears from the testimony of Col. Baker, of James Williams, and of J. H. Johnston,
3. From.the plaintiff’s construction of this letter at the time he received it, as appears by the testimony of James Williams, J. H. Johnston, Lilly and Duplantier.
4. From Duplantier’s construction of this letter. It is, therefore, fair to understand this letter as all the parties did at or about the date of the transaction-growing-out of it. If it were doubtful whether the impressions- this letter made on the plaintiff conveyed Smith’s intentions respecting this purchase, Smith’s frequent declaration of his dissent, in the presence of many witnesses,-would remove that doubt and shew his mind fully on the subject. It will, therefore, follow from the testimony that the plaintiff in annulling, the first purchase did so with the fair and honest motive of satisfying Smith; If he did'consider himself authorised, previous to Smith’s letter, his opinion was so far changed afterwards as to induce him to undo; what he had done, to re
VI. But the plaintiff is viewed in the light of an agent ; how he could be an agent for Smith, in the purchase of land for the partnership, is not conceived ; he was then, if at all, an agent for thé partnership, but the partnership did not extend to land purchases ; his agency in the partnership is defined in the articles. As a partner he is a principal and no ageñt. Watson on P. 2. He is not constituted the agent of Smith, nor of Kemper &, Co. ; if he were the agent he would bind his principal, for if in the purchase he contracted as agent, it was not in his own name, but for Kemper & Co.; see Pothier on Contracts 334, “ it is not he, the agent, that contracts, but his principal,” and yet in this case his principal, (if any) was not bound, and therefore could not have contracted. Besides, if he were an agent to make the purchase, he was also an agent to annul it ; for an agree-' meat may be waved, with the concurrence of the parties, Powell Contracts, 412 (and we may add) or their agents. A case is cited shewing that “ no “ person, who. undertakes the management of the “ business of another,, can abandon it.” Does this mean any thing more than that he who engages as an agent shall not neglect the business of the principal? or that a person who even voluti-tarily undertakes shall not occasion injury to the
The other case cited from Domat, is where “ an agent has bought for another.” This applies to a constituted agent. If his transactions are gainful, the benefit must result to his, constituent ; if he act with a certain degree of imprudence,, he must suffer for it. This cannot apply to a person who is under no obligation to act for another.
VII. But although, as a .partner, the plaintiff had no right to bind the firm, and of course none to affix its signature : although he be not the agent of Smith, nor of Kemper St Co. «till it is contended that the plaintiff, as a partner might extend his powers as such by adding to them those of a proxy or attorney. If he had discretionary powers, they bound the partnership ; that
VIII. Th e lawrelating to the negotiorum gestor, is regulated by positive statute, 5th part. 12, 26 : it relates only to cases where there is some business in which the principal has an existing interest, and to the same effect is Pothier, 168 there must be an affair in which the principal is interested : the negotiorum gestor cannot create one for his principal without his knowledge, for this conclusive reason that by 5, Partid, tit. 12, law 20 ;, the negotiorum gestor has an action against his principal for his disbursements and expences, if bona Jide incurred. Now, it would be monstrous to make a man pay the price of the land, or the expense of conveying it, wherever an officious friend might think it for his interest to make a purchase for him. '
X. If Kemper’s purchase continued to the benefit of Smith, it could only be from the time of his ratification, because there was neither express nor implied authority, and in the intermediate time he had the same right to rescind that he had to purchase.
XI. If a decree should be given in favor of Smith, for the one half, as the legal title is in Kem-per, he ought not to be divested, but on a full and final settlement, and payment by Smith of all what he owes to Kemper on their partnership account!
The Court allowed are-hearing: but required counsel to confine their arguments to the following questions.
1. Whether a person, after having created an interest for another, can destroy that interest, before the other has signified his refusal ta accept it ?
2. How far a partner may bind his .firm in contracts which, though not contemplated by the articles of copartnership, are entered into for the utility of the firm and for the better management of its business ? Postea, vol. 4.
Martin, J. did not join in this opinion, having been of counsel in the cause.
Reference
- Full Case Name
- KEMPER v. SMITH
- Status
- Published