Shorter v. The Columbus Iron Works

• Decision Date: 31 July 1871
• Citation: 44 Ga. 228
• Parties: SANKEY & SHORTER, plaintiffs in error. v. THE COLUMBUS IRON WORKS, defendant in error. SANKEY & SHORTER, plaintiff in error. v. HALL, MOSES &COMPANY, defendant in error.
• Court: Georgia Supreme Court

44 Ga. 228

SANKEY & SHORTER, plaintiffs in error. v. THE COLUMBUS IRON WORKS, defendant in error. SANKEY & SHORTER, plaintiff in error. v. HALL, MOSES &COMPANY, defendant in error.

Supreme Court of the State of Georgia

(Atlanta, July Term, 1871.)

[COPYRIGHT MATERIAL OMITTED.]

Partnership. Evidence. Interrogatories. Before Judge Johnson. Muscogee Superior Court. November Term, 1870.

The Columbus Iron Works sued Sankey & Shorter as partners, for goods sold and delivered. Sankey was not served. Shorter pleaded that he was never Sankey's partner, etc. The account began in January, 1867, and ended on the 7th of March, following. Plaintiff proved the account by its books only. The contest was as to the fact of partnership. Plaintiff offered as evidence interrogatories answered by Sankey. The first question was, "do you know who composed the firm of Sankey & Shorter, who had a saw mill in 1866 and 1867 in Russell county, Alabama. If *you were one of said firm state what connection James H. Shorter had with the firm." The answer was, "I know who composed the said firm, James H. Shorter and myself. Mr. Shorter furnished the mill, and I furnished the hands and run the mill." The second question was of like character. On these interrogatories was written, before they were crossed, an objection because they were leading and asked legal conclusions. These objections were insisted upon at the trial and overruled. But it was said in argument that they were not made till the trial. Besides the foregoing answer, Sankey therein testified that the partership between him and Shorter lasted till the 1st of March, 1867; that he invested no money in the mill, it belonged to Shorter, but he, Sankey, bought stock to run the mill. "The contract was that I should superintend the mill, and have one-half interest in the mill and all appurtenances, for which I was to pay Mr. Shorter." He further swore that during Shorter's absence, in Cuba, he, Sankey, moved the mill to another place and arranged for another to furnish lumber and take an interest in the mill. Here plaintiff closed.

Defendant's counsel then asked to continue, that he might get a witness from Alabama to impeach Sankey, saying his answers had been in but a few days, he did not know what he would swear, and had not had time to get the testimony of the absent witness. The Court refused the continuance. Shorter then testified that in the fall of 1865 he owned said mill and appurtenances, and engaged Sankey to supervise it and give him half of the net profits for his services; that Sankey never had any authority to use such firm name, that there was no partership, nor did he know Sankey had used it till 1867, and immediately took steps to stop it. "Sankey had no joint interest in the property, nor joint in-terest in the profits and losses of the business; he had a common interest in the net profits alone; he was to share none of the losses if any were sustained inthe business." And he denied knowing anything of the purchase of said goods, and said it was *after the removal of the mill, in his absence and without his knowledge. He was asked "the usage of the mill as to purchasing while he was with it, " but the Court sustained an objection to this question. Defendant sought also to prove the arrangement which Sankey made with said third person when he moved the mill, but the Court would not allow him to do so.

As to the question of partnership the Court charged the jury, "if Shorter was to furnish the mill, and Sankey was to furnish the hands and supervise the running of the mill, and the net profits were to be divided between them, then Shorter was a copartner with Sankey, and as such is responsible to plaintiff. If Sankey, without the knowledge or consent of Shorter, formed a coparnership or made an arrangement with Wilkinson, such as was testified to, this would dissolve the partnership of Sankey & Shorter, and Shorter would not be liable as a partner for articles purchased by Sankey after such agreement with Wilkinson."

Defendant's counsel requested him to charge the jury: 1. "Where a party takes a common interest in profits alone for his services, he is not bound in law for any losses of the business; and if there are no profits and some debts, and the party gets no profits and is liable for no losses, there is no partnership." 2. "If Sankey and Shorter run a saw mill, and Shorter was to pay one-half the net profits to Sankey for his services alone, this does not make them partners." 3. "Participation in profits will not necessarily create a partnership in all cases as to third persons. Thus if a party has no interest whatsoever in the capital stock, and as between himself and the other parties he has also no rights as a partner, but is simply employed as an agent, and is to receive a given sum out of the profits as a compensation for his services, he will not be deemed a partner in the concern from that fact alone; nor as to third persons, because the transaction may justly be deemed a meremode of ascertaining and paying the compensation of an agent as in a naked case of agency." *4. "The sayings of Sankey that Shorter was a partner, in his testimony, should not be considered."

The Court refused to charge the first request. He refused the second, and charged in lieu thereof that "if Shorter furnished the mill and Sankey furnished the hands and run the mill, and the net profits were divided between them, then Shorter was a partner with Sankey. and is responsible as such to plaintiffs. He refused to charge the third request. He also refused to charge the fourth, and in lieu of itcharged "that partnership or no partnership is a fact which witnesses may swear to." The jury found for plaintiff for the amount sued for.

Shorter says the Court erred in overruling said objections to Sankey's interrogatories and answers; in refusing a continuance; in not allowing Shorter to testify as to the usage of the mill; in charging as he did, and in refusing to charge as requested. So much for the first of said cases.

The second is so very similar to it that a report of it is unnecessary. They were treated as one case here.

James M. Russell, for plaintiff in error. As to the interrogatories: R. Code, sees. 3809, 3811, 3812. Usage competent: R. Code, sees. 3752-1. Evidence of arrangement with Wilkinson competent: R. Code, sees. 1886, 1907, 1895; Story on P., sec. 5; 15 Miss. R., 370. The verdict was contrary to law: 18 Ga. R., 703; R. Code, sec. 1880; Hansard's Debate, volume 178, page 1274; 180, page 121; 10 Met. R., 303; 34 Howard's R., 536; Story on P., sees. 32, 36, 38, 49, 43; 12 Conn. R., 69; 14 Pick. R., 192; 14 Louis (Mo.) R., 52; 5 Gray's R., 588; 6 Met. R., 82; Smith on M. L., 40; 6 Halstead, 181; 1 Denio, 337; 2d, 279; 3 Conn. R., 132; 5 Iowa, 721; 25 Barb. 13.

Peabody & Brannon, for defendants in error. The questions are not leading: 1 Gr. on Ev., sec. 434. If they were Court may allow them: Ibid., sec. 435. The exceptions *should have been filed with interrogatories: 37th Rule of Court. Verdict was according to law: 8 Ga. R., 285; 14th, 705; 33d, 243; 36th, 344.

McCAY, Judge.

1. The important question in this case, the construction we are to put upon section 1880 of our Revised Code. That section is as follows: "A joint interest in the partnership property or a joint interest in the profits and losses of the business constitutes a partnership as to third persons. A common interest in profits alone does not."

Under the testimony of Sankey in these cases, he and Shorter were clearly partners, since, according to his statements, he was to furnish the hands and Shorter the mill, and the profits to be divided equally. According to this there was a joint interest in the stock, since that was made up of the mill and the hands to work it; and the case falls within the terms of the first line of the section.

But Mr. Shorter's testimony states directly the contrary of this. He furnished, as he says, the mill and the hands; Sankey was a mere superintendent, and had no interest at all in the stock. He says further, that Sankey did not have "a joint interest in the profits and losses, but only a common interest in the profits."

The language of this witness is in the express words of the statute, and, if it is to be taken literally, it...