Aspinwall v. Williams
Aspinwall v. Williams
Opinion of the Court
^Opinion of the court, by
The question to be decided is, was there a partnership at the date of the note, so as to render Williams liable to this action.
For the plaintiff, it is insisted that the contract created a complete partnership from the moment it was signed, and that the-stipulations as to what each partner shall do, are nothing more than a distribution of the services to be performed by each, for, and on account of the joint concern.
In deciding the question submitted, it is necessary to ascertain what constitutes a partnership in the view of the law. Having donoso, we may determine the true construction of this contract, and whether it did or did not create a partnership between the parties, from the time of its execution.
A partnership has been defined to be “ a contract of an association, by which two or more contribute money, goods, or labor, to the end that the profits may be ratably divided between them.” This definition, as far as it goes, is said to.be unexceptionable; but it is incomplete, as to third persons, between whom and the parties the question most frequently arises. In this respect, it is observed that he who shares in the profits ought to bear his portion of the^ losses, because by taking the profits he takes the fund on which the creditor relies for payment. In order to constitute a partnership so - as to make a person liable as a partner, there must bo some agreement between him and the ostensible person to share in the profits, or he must have permitted the ostensible person to 'use his credit, and to hold him out as one jointly answerable with himself. 1. Com. on Cont. 286 ; Doug. 371.
In order to constitute a partnership, a communion of profit and-' loss between the parties is essential, and this is the true criterion to judge by, when the question is, whether persons are parties or not. 1 H. Blac. 43, 48. Where one takes a moiety of the profits, he shall, by operation of law, be made liable for losses. 2 H. Blac. 247. But where an agreement was made for the purchase of goods, in the name of one, for the benefit of several, but the agreement did not extend to a joint sale of the goods, a majority of the court held that it was not a partnership, but had the agreement extended to the sale as well as the purchase, all would have been liable, though but one was known in the purchase. 1 H. Blac. 37. Though in-*point of fact, parties are not partners, yet if one so represent himself, and by that means gets credit for the other, both shall ba
Again. It would seem that the term, establishment, as used in the agreement, was intended to embrace the whole concern of the parties, and to include the store, as well as the distillery. If this inference be correct, no doubt can remain, as the first article in the contract provides, that the parties shall share and share alike the most of the establishment. The cost of an establishment must -^include all moneys expended, and all debts contracted in the completion of it, which would, in this ease, include the debt on which-the suit is brought. The mind seems to be irresistibly led to this conclusion from the consequences that adifferent construction would produce on the parties themselves. Admit for a moment that the-defendant’s construction is to be sustained, and what is the consequence? Williams, on his part, is to furnish the ground and to erect the buildings, at the joint cost of all the parties. Chase- and Gardner, on their parts, are to furnish the stills, worms, and goods at their own individual cost; and when all are furnished, each is to be an equal owner of the whole. The injustice of such a construction, must be apparent.
But if it be admitted that the store was not considered as a part, of the establishment, but merely as an appendage, the same conclusion seems to follow, for as the principal establishment was by express stipulation to be erected at the joint cost of all the parties, the appendage to the establishment must be provided on the same terms. Justice requires it — the common sense of mankind requires it.
Had it been the intention of the parties to provide for a partnership, to commence at a future day after each of the parties had furnished his portion of the stock, the contract would have contained some stipulation as to the amount to be furnished by each, and that, it should be on his own credit, so that each might bring into the* common stock an equal portion of it. But nothing is said on this subject. Each party is left to his own discretion. The building-may cost much or little — the assortment of goods may be small or extensive — yet each is to be equally interested in, and an equal owner of the whole.
In forming an establishment of this kind, various duties and services were to be performed, and it was natural to distribute these-among the parties with reference to their different capacities; hence we find that Williams was to have the building erected, and. the other partners were to lay in the goods. This consideration-will sufficiently account for this part of the arrangement, without searching for any other cause, and when in connection with this it. is considered that all the disbursements and engagements of Williams, in performing his part of the contract, were to be at the joint , cost of the concern, it seems to remove all doubt as to the understanding of the parties themselves on this point.
But some stress has been laid on the clause, that “ an equal pro
Great reliance is placed on the case of Saville v. Robertson, which the defendants consider as establishing the construction for which they contend. Independent of the fact that the court were divided in that case, we can not but view it as operating rather against the construction they contend for, inasmuch as the leading facts on which a majority of the court found their opinion do not exist in this agreement, and in the absence of those facts it can scarcely be doubted that the whole court would have concurred with Ashhurst ; but let us examine the case, and compare it with the one before us. In Saville’s case, each individual was to have an interest in the cargo equal to the amount of goods he might furnish. In this case, each party was to have an equal interest in the whole establishment. In that case the contract extended to a single voyage only, at the expiration of which each party was to receive back the amount of cargo he had furnished. In this case the contract was to continue fifteen years, and the interest of the parties was not governed by the amount furnished by each. In that case it was expressly stipulated, that the parties should not be liable for the engagements of each other. In this case it is as expressly stipulated that the parties shall share and share alike the cost of the establishment. In
There are other circumstances in the case from which inferences might be drawn; as for example, the language of the article is in the present time — the parties do agree to erect, etc. — the law shall commence from the time of signing the instruments, and the receipt on the back of the article recognizes a liability for debts as well as for costs, but wo have not thought it necessary to dwell on these facts.
We do not discover any serious difficulty in the form of executing the note. The agreement being silent on that subject, the fair presumption arising from all the circumstances is, that the form adopted by Chase was the one agreed on by the parties.
We are clearly of opinion that the partnership commenced from the signing of the articles, and that the plaintiff had a right to look to the credit of all the parties. A new trial, therefore, must be granted.
Reference
- Full Case Name
- Aspinwall v. Williams and others
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