Hobart-Lee Tie Co. v. Grodsky

• Decision Date: 11 February 1932
• Citation: 46 S.W.2d 859,329 Mo. 706
• Parties: Hobart-Lee Tie Company, Appellant, v. J. Grodsky, O. A. Palmer, Sam E. Grodsky and M. Grodsky, as Last Board of Directors and Trustees of Commerce Financial Corporation; O. G. Roeder, Paul F. Plummer and Edwin A. Schmid, as Trustees and Last Board of Directors of Black River Tie & Timber Company, and E. F. Cordia, J. Grodsky and O. G. Roeder, as Individuals
• Court: Missouri Supreme Court

46 S.W.2d 859

329 Mo. 706

Hobart-Lee Tie Company, Appellant, v. J. Grodsky, O. A. Palmer, Sam E. Grodsky and M. Grodsky, as Last Board of Directors and Trustees of Commerce Financial Corporation; O. G. Roeder, Paul F. Plummer and Edwin A. Schmid, as Trustees and Last Board of Directors of Black River Tie & Timber Company, and E. F. Cordia, J. Grodsky and O. G. Roeder, as Individuals

Supreme Court of Missouri

February 11, 1932

Rehearing Overruled December 21, 1931. Motion to Transfer to Banc Overruled February 11, 1932.

Appeal from Circuit Court of City of St. Louis; Hon. Claude O Pearcy, Judge.

Reversed and remanded (with directions).

Jourdan & English and Harry Clymer for appellant.

(1) Where there is a scintilla of evidence to support an issue in plaintiff's favor plaintiff is entitled to have the jury pass on the evidence supporting such issue, even though it be conflicting and contradicted, and in passing upon the evidence part of the testimony of any witness may be taken as true and the balance disregarded. Schultze v Steele, 69 Mo.App. 627; Vickers v. Arthur, 9 S.W.2d 813; Gould v. Railroad Co., 315 Mo. 713; Horine v. Clear, 2 S.W.2d 154. (2) The existence or non-existence of a partnership is one of fact to be submitted to the jury, and this issue may and should be submitted to the jury where there is evidence of profit-sharing between the alleged members of the firm and participation in the management of its affairs. R. S. 1919, sec. 1415; Torbert v. Jeffrey, 161 Mo. 645; Simmons v. Ingram, 78 Mo.App. 603; Schultze v. Steele, 69 Mo.App. 614; Goddard-Peck Grocer Co. v. Berry, 58 Mo.App. 665; Meyers v. Boyd, 44 Mo.App. 378; Loveland v. Chapman, 267 S.W. 73; Interstate Coal Co. v. Gordon, 216 S.W. 783; Goodyear Tire & Rubber Co. v. Ward, 197 Mo.App. 286; R. S. 1919, sec. 5831; Horine v. Clear, 2 S.W.2d 154. (3) Those who the evidence shows or tends to show participate in a partnership venture or joint adventure may be held liable on the contracts made by one of them in connection therewith, the liability being joint and several. R. S. 1919, secs. 2155, 2158; Bagnell v. Railway, 242 Mo. 11. (4) A corporation may not plead nor rely on the defense of ultra vires where the contract sued on has been fully performed by the opposite party, especially where the corporation has benefited thereby. Schlitz Brewing Co. v. Poultry & Game Co., 287 Mo. 400; Marshall v. Knights of Maccabees, 270 S.W. 418. (5) It is not ultra vires for a corporation to participate in a joint adventure. 14A C. J. 293. (6) An instruction cannot be held erroneous for failing to define words or phrases used therein. If the party complaining of such instruction desires that terms be defined the complaining party should offer instructions giving the proper definition. Block v. U. S. F. & G. Co., 290 S.W. 439. (7) Where, in sustaining a motion for new trial, the trial court assigns alleged errors committed by the trial court, in the giving of instructions, or the lack of evidence warranting the submission of any issue to the jury, and where the court did not err in such instructions and where there was sufficient evidence to submit such issue to the jury, then the judgment should be reversed and the case remanded with directions to reinstate the verdict. Mooney v. Gasoline & Oil Co., 317 Mo. 1255; Candee v. Railway Co., 130 Mo. 142; Karguth v. Coal & Coke Co., 299 Mo. 580.

Jeffries, Simpson & Plummer for respondents O. G. Roeder, Paul F. Plummer and Edwin A. Schmid, as Trustees of and the Last Board of Directors of Black River Tie & Timber Company.

(1) A partnership does not exist in the absence of an intention to form it. Chapin v. Cherry, 243 Mo. 407; Hughes v. Ewing, 162 Mo. 298; Freeman v. Bloomfield, 43 Mo. 391; Fuel Co. v. Brady, 202 Mo.App. 551; McDonald v. Matney, 82 Mo. 358; Mining Co. v. Swope, 204 Mo. 48. (2) In the absence of written articles of association or of copartnership between the supposed partners, the fact of partnership is to be inferred only on direct proof of a positive intention to form that relation. Fuel Co. v. Brady, 202 Mo.App. 551; Hughes v. Ewing, 162 Mo. 261. (3) A mere participation in profits and loss does not necessarily constitute a partnership, since each case must be determined upon its own peculiar facts to arrive at the intention of the parties. Fuel Co. v. Brady, 202 Mo.App. 551; McDonald v. Matney, 82 Mo. 358. (4) A corporation is prohibited by law from becoming a member of a partnership. Aurora State Bank v. Oliver, 62 Mo.App. 390; Franz v. Dry Goods Co., 132 Mo.App. 8; State ex rel. v. Lee, 288 Mo. 698. (5) In order to hold persons liable on the theory that they are members of a joint adventure, the proof must show such a relationship between them as creates mutual agency, right of control, division of profits, etc., to the same extent as if an actual partnership existed between them. Fuller v. Laws & Easter, 219 Mo.App. 342; Schaefer Constr. Co. v. Jones, 3 S.W.2d 288; Darling v. Budd, 1 S.W.2d 169; Loomis v. Abelson (Vt.), 144 A. 379. (6) In the absence of an intention between persons to obligate themselves as members of a joint adventure no such relationship exists. Cases cited under Point 5. (7) If an agent contracts on behalf of an undisclosed principal, the opposite party has his election to hold either the agent or the undisclosed principal, but cannot hold both. Sessions v. Block, 40 Mo.App. 569; Provenchere v. Reifess, 62 Mo.App. 50; Anchor Warehouse Co. v. Mead, 181 S.W. 1060; United States Wood Preserving Co. v. Paving Co., 245 S.W. 351; Squire v. Drozda Realty Co., 288 S.W. 992. (8) Instruction I given at the request of plaintiff left a question of law to the jury in that it left them to find whether or not a partnership or joint adventure existed between the defendants without defining either of said relations or hypothesizing the facts from which the jury could find its existence. The instruction was, therefore, erroneous. 1 Thompson on Trials, sec. 1132, p. 948; Dulany & Co. v. Elford & Dargan, 22 S.C. 304; Croce v. Ins. Co., 260 S.W. 760; Anderson v. McPike, 86 Mo. 293.

Leahy, Saunders & Walther and J. L. London for respondent J. Grodsky, O. A. Palmer and Sam E. Grodsky, as the Last Board of Directors and Trustees of Commerce Financial Corporation.

(1) Before plaintiff can recover, it must show a partnership. National Bank of Commerce v. Francis, 296 Mo. 169; Darling v. Buddy, 1 S.W.2d 167; Fuel Co. v. Brady, 202 Mo.App. 551; Green v. Whaley, 271 Mo. 636; Pioneer Lbr. Co. v. Van Cleave Lbr. Co., 279 S.W. 241; Horine v. Clear, 2 S.W.2d 154. (2) Instruction 1 submits issues of law and leaves it for the jury to determine for itself the material facts. 1 Thompson on Trials, 948, sec. 1132; Simmons v. Ingram, 78 Mo.App. 608; Davis v. Tel. Co., 236 S.W. 407; Anderson v. McPike, 86 Mo. 298; Croce v. Insurance Co., 260 S.W. 760; Hughes v. Ewing, 162 Mo. 261; National Bank of Commerce v. Francis, 246 S.W. 332, 30 Cyc. 592; Dulany & Co. v. Elford & Dargan, 22 S.C. 304; Coody v. Shawver, 161 S.W. 935. (3) Instructions 1 and 2, given at the request of plaintiff and defendant Cordia, although undertaking to cover the case, fail to cover the defenses of the defendants and are erroneous. Carroll v. Ins. Co., 249 S.W. 691; Thornton v. Mersereau, 168 Mo.App. 9. (4) The instruction cannot be broader than either the pleading or the proof, and to recover plaintiff must rely upon the theory set out in its petition, and the instruction must include every element necessary to plaintiff's right to recover. State ex rel. People's Bank v. Melton, 251 S.W. 447; Llywelyn v. Lowe, 239 S.W. 535; Keppler v. Wells, 238 S.W. 425; Ross, etc., v. Lbr. Co., 253 S.W. 119. (5) The court erred in permitting witnesses to testify to agency before establishing a partnership, which was never established. Makinson Co. v. Fish & Oyster Co., 241 S.W. 959; Minks Bros. v. Gilloiz, 256 S.W. 516; Colt v. Watson, 247 S.W. 493. (6) A partnership is either a matter of contract or is created by estoppel. No estoppel is claimed in this case, and plaintiff must establish an intention to become partners and a contract of partnership. Cases cited under Point 1; 30 Cyc. 385. (7) A corporation has no power to become a partner. Thompson on Corporations, 2421; Aurora State Bank v. Oliver, 62 Mo.App. 391; Moreheads v. United Railways, 119 Mo.App. 623; 14A C. J. 293.

OPINION

Gantt, P. J.

Action to recover a balance due plaintiff for railroad ties. The sale and delivery of the ties and the amount due are not questioned.

Plaintiff alleged that the individual defendants and the defendants Commerce Financial Corporation and Black River Tie & Timber Company (Missouri corporations) were members of a joint enterprise and as partners did business under the trade name of E. F. Cordia Land & Lumber Company. It further alleged that defendants doing business as members of said enterprise purchased the ties from plaintiff.

The corporations were dissolved prior to the institution of this suit. In this situation, plaintiff sued certain defendant persons as constituting the last board of directors and trustees of said corporations. It did so thereby seeking to subject assets of the corporations in the custody of said directors and trustees to the payment of the balance due plaintiff. The petition was not challenged by demurrer or motion.

The answers denied the existence of a joint enterprise and partnership. Further answering, the defendants (last board of directors and trustees of said corporations) pleaded that said corporations could not legally engage in a joint enterprise and partnership or become liable as members of a joint enterprise and partnership. The replies were general denials, with pleas that said corporations and persons received the ties from plaintiff, sold...