Maltby v. Northwestern Virginia R. R. Co.

• Decision Date: 19 July 1860
• Citation: 16 Md. 422
• Parties: CALEB S. MALTBY, surviving partner of HOLT & MALTBY, v. THE NORTHWESTERN VIRGINIA RAIL ROAD COMPANY.
• Court: Maryland Court of Appeals

16 Md. 422

CALEB S. MALTBY, surviving partner of HOLT & MALTBY, v. THE NORTHWESTERN VIRGINIA RAIL ROAD COMPANY.

Court of Appeals of Maryland.

July 19, 1860

The fact that a particular shipment, made by a firm, was the result of an antecedent private agreement between the partners, does not affect the responsibility of the firm to the public, nor the rights of the plaintiff, having had no notice thereof, who is suing the firm on a contract made by one of the partners in the name of the firm.

The main business of a general partnership was the catching, packing, transportation and selling of oysters to western country, but it was proved that the partners formerly owned a line of wagons, that they purchased, held and sold real estate in their joint names, owned vessels which they employed in the coasting trade, and subscribed for and purchased and sold stock in railroad and other companies. HELD:

That from this evidence, it was competent for the jury to find that a particular subscription for stock in a railroad company, made by one partner in the name of the firm, was within the scope of the partnership and in the course of its business.

Under the limitations of a special partnership, one partner has no power to exceed them in his dealings, and if the party with whom he deals has knowledge of the nature of the partnership he is estopped from holding the other liable on such a contract.

Where the transaction is wholly unconnected with and beyond the scope of the partnership, the firm is not bound by any contract of a single partner, though the party implicitly trusted on the credit of the firm.

But each partner is the accredited agent of the rest, whether they be active, nominal or dormant, and may transfer, pledge exchange or dispose of the partnership property and effects for any purposes within the scope of the partnership and in the course of its business.

As a general rule, strict compliance with its charter, as to organization, must be shown by a corporation seeking to enforce payment of subscriptions to its stock, but in some cases compliance will be presumed and in others it may be waived.

Payment of instalments on a subscription to its stock is a sufficient recognition of the legal existence and organization of a corporation, by the subscriber so paying, to enable it to recover the remaining instalments from him.

A prayer, that upon certain facts being found by them, the plaintiff is entitled to recover, " unless the jury shall find that the subscription, to recover which this suit was brought, was an individual undertaking of one of the partners," & c., is erroneous in assumimg the fact of the subscription, instead of leaving it to be found by the jary.

In an action, by a corporation, to recover subscriptions to its stock, an instruction that upon the finding of certain facts the plaintiff is entitled to recover, but omitting the material facts of the proceedings of the corporation calling for the instalments and notice to the defendant of these calls, is erroneous; no matter how clear the evidence may have been to prove these omitted facts, it was necessary for the jury to pass upon it.

A prayer, that if the jury found certain facts enumerated therein, " then there was sufficient evidence of a subscription, " & c., is erroneous; it was calculated to mislead the jury, who might well have supposed the court was instructing them as to the sufficiency in fact of the evidence to prove the subscription.

It is competent for the court to pass upon the legal sufficiency of evidence to go to the jury as tending to prove a given fact, but it is an invasion of their province to instruct them that the evidence is sufficient to prove the fact.

The legal sufficiency of evidence is for the court to determine, but its weight, or its sufficiency to establish another fact sought to be inferred from it, is exclusively for the jury.

APPEAL from the Superior Court of Baltimore City.

Assumpsit, brought on the 29th of December 1855, by the appellee against the appellant, as surviving partner of the firm of Holt & Maltby, to recover certain unpaid instalments of an alleged subscription for 150 shares of the capital stock of the Northwestern Virginia Rail Road Company, made in the name of the firm by the deceased partner, Dan. Holt, in his life time. Plea non assumpsit.

1 st Exception. This exception, with the evidence in the cause, is fully stated in the opinion of Chief Justice Le Grand.

2 nd Exception. The plaintiff, after the evidence had been offered, asked the three following instructions to the jury:

1st. If the jury believe, from the evideuce, that a partnership, in business, existed between Dan. Holt and Caleb S. Maltby, for some years prior to the subscription to the capital stock of the plaintiff, that has been offered in evidence, and existed when that subscription was made; and if the jury shall believe that, during that time, the said firm, under its partnership name, bought and sold stock in the Baltimore & Ohio Rail Road Company, subscribed to the capital stock of the York & Cumberland Company, purchased and exported goods and merchandize to California, owned, in whole or in part, the barque Hebe, which was dispatched by them to California, owned also the schooner Swan, which was employed by them, from time to time, in the coasting coal trade, purchased real estate in the city of Baltimore, purchased and managed wagons and teams of horses for the transportation of oysters from Frederick city and from Cumberland, prior to the completion of the Baltimore and Ohio Rail Road, to the western country, purchased and owned real estate in the State of Virginia, all of which transactions were apparently on the joint account of the members of said firm, as partners under the name aforesaid; and if the jury shall further believe, that during the period of the transactions, above referred to, the said firm, by Dan. Holt aforesaid, subscribed, in the partnership name, to one hundred and fifty shares of the capital stock of the plaintiff, then there is evidence from which the jury may infer the authority of the said Holt to bind the said firm by such subscription, so far as liability to the plaintiff is concerned, in which event the plaintiff will be entitled to recover in this action any unpaid instalments due on said subscription, with interest from the dates when such instalments were payable, even though the jury should find that the principal business of the said firm was the catching, preparing and forwarding oysters from Baltimore to the western country.

2nd. If the jury shall find, from the evidence, that Dan. Holt and Caleb S. Maltby were partners, in Baltimore, at the time of the subscription, offered in evidence in this cause, in the business of catching, preparing and transporting oysters to the western country, and that, for the purpose of facilitating their said business, they owned, as partners, and managed teams of horses and wagons to forward their oysters, first from Frederick city and afterwards from Cumberland, westward, prior to the completion to Wheeling of the Baltimore & Ohio Railroad; and if the jury shall further believe that the rapid transportation of oysters westward was important, if not essential, to the business of the said firm, and that there was a reasonable expectation that said transportation would be facilitated by the completion of the Northwestern Virginia Railroad and its western connections, then the said subscription came so far within the scope of the said partnership as to authorize the said Dan Holt to make the same on partnership account, and the plaintiff is entitled to recover in this action any unpaid instalments due on said subscription, with the interest from the dates when such instalments became payable.

3rd. This prayer, after stating the evidence offered by the plaintiff, consisting of its charter and those portions of the General Code of Virginia, referred to therein, the record book of the company, showing the proceedings of the meeting of the stockholders for the election of officers, and the organization of the company, the proceedings of the board of directors of the 4th of August 1851, authorizing the persons therein named to open books of subscription to the capital stock of the company, in the city of Baltimore, and the proceedings of said board calling for instalments upon the capital stock, the subscription upon which this suit is brought, and the receipts of the company given to Holt & Maltby, for the first and second instalments, which were pard in the life-time of Holt, concludes thus: " Whereupon, the plaintiff prays the court to instruct the jury, that if they found the above facts, then there is sufficient evidence of a subscription of one hundred and fifty shares to the capital stock of the Northwestern Virginia Railroad Company, in the name of Holt & Maltby, to bind the party or parties legally responsible therefor."

The defendant then offered nine prayers, as follows:

1st. That the paper offered in evidence by the plaintiff, and admitted by the defendant to have been signed by the late Dan. Holt, in the name of Holt & Maltby, is not, per se, a complete and effectual subscription for 150 shares of the capital stock of the plaintiff, even if the jury should find, from the evidence, that the same was signed by said Holt with the knowledge and assent of the defendant.

2nd. That under the provision of the Act of incorporation, offered in evidence by the plaintiff, and under the provisions of the code of Virginia, prescribing general regulations for the incorporation of railroad companies, also offered in evidence by the plaintiff, the plaintiff is not entitled to recover in this case, unless, in fact, books were opened for...