Good v. Red River Valley Co.

• Citation: 78 P. 46,12 N.M. 245,1904 -NMSC- 019
• Decision Date: 13 September 1904
• Docket Number: 1016
• Parties: GOOD et al. v. RED RIVER VALLEY CO.
• Court: Supreme Court of New Mexico

78 P. 46

12 N.M. 245, 1904 -NMSC- 019

GOOD et al. v. RED RIVER VALLEY CO.

No. 1016

Supreme Court of New Mexico

September 13, 1904

Syllabus by the Court.

1. An action against G., H., and K., partners under the firm name of George S. Good & Co., is an action against individual partners and not against the firm as such, under section 2943, Comp. Laws 1897, and does not authorize a judgment against the firm as such, or the individual members not served.

Error to District Court, Santa Fé County; before Justice John R McFie.

Action by the Red River Valley Company against George S. Good and others, partners under the name of George S. Good & Co. Judgment for plaintiff. Defendants bring error. Reversed.

Jones & Rogers, for plaintiffs in error.

George P. Money, for defendant in error.

PARKER J.

This is an action brought by defendant in error against the plaintiffs in error in the district court of the Fourth judicial district, sitting in and for the county of San Miguel. After service of process upon one of the partners, a change of venue was granted to the district court of the First judicial district, sitting in and for Santa Fé county. There judgment by default was entered against the plaintiffs in error.

In the absence of statute the contract of a firm is the joint obligation of all the partners, and all must be sued personally. The words "partners under the firm name of ___" are ordinarily merely descriptio personæ. Innovations have been made by statute in several states. In some it is provided in terms that a partnership may be sued by its common name, without giving the individual names of its members. Leach v. Milburn Wagon Co. (Neb.) 15 N.W. 232; Whitman v. Keith, 18 Ohio St. 134; Moore & McGee v. Burns & Co., 60 Ala. 269; Davidson v. Knox, 67 Cal. 143, 7 P. 413. In others it is provided that a partnership may sue or be sued as such and judgment rendered against it as such, which judgment may be satisfied out of the partnership property or the individual property of such members as have been served or appear. When the action is against the firm as such, service on one member is sufficient service on the firm. This is the New Mexico statute. Section 2943, Comp. Laws 1897. This statute is a copy, with one slight, immaterial variation, of the Iowa statute, which has been construed to authorize actions against a firm by the firm name. Hamsmith v Espy, 13 Iowa 439; Brumwell v. Stebbins Brothers, 83 Iowa 425, 49 N.W. 1020. The language is susceptible of no other construction.

It is only when a default is made, as in this case, that it becomes at all important to determine whether an action is against a firm as such or against the partners as individuals. If they are all served or appear, in an action against the firm as such, the same kind of a judgment can be rendered as if they had been sued as individuals, viz., a judgment which could be satisfied out of both the firm property and the individual property of the partners. But partners, when sued, have a right to rely upon the nature of the action as disclosed by the complaint, and to act accordingly. If sued as individuals, they know that no judgment can be rendered which will bind them until they have been served with process. If sued as a firm, they know that service on one member of the firm will authorize a judgment which can be satisfied out of the firm property. They might, therefore, feel called upon to appear and defend against an action against the firm, while they might not, unless served with process, if the action be against them as individuals. The plaintiff, therefore, must elect which way he will proceed, and follow the procedure required in each case.

In this case the complaint is in the caption as follows: "Red River Valley Company, a Corporation, versus George S. Good F. C. Hitchcock, and James Kerr, partners under the firm name of George S. Good & Company, alias Geo. S. Good & Co." In the body of the complaint the defendant in error alleges: "That at the times hereinafter mentioned the said defendants, George S. Good, F. C. Hitchcock, and James Kerr were, and now are, copartners and doing business in said county *** under the firm name of George S. Good & Co., alias Geo. S. Good & Co." The summons is directed to George S. Good,...