State v. Peterson

• Decision Date: 06 May 1957
• Docket Number: No. 43391,43391
• Citation: 232 La. 931,95 So.2d 608
• Parties: STATE of Louisiana v. Eric PETERSON.
• Court: Louisiana Supreme Court

Page 608

95 So.2d 608

232 La. 931

STATE of Louisiana v. Eric PETERSON.

No. 43391.

Supreme Court of Louisiana.

May 6, 1957.

Jack P.F. Gremillion, Atty. Gen., M. E. Culligan, Asst. Atty. Gen., J. St. Clair Favrot, Dist. Atty., Ralph L. Loy, Asst. Dist. Atty., Baton Rouge, for appellant.

Major & Ponder, Baton Rouge, for appellee.

HAMLIN, Justice ad hoc.

The State of Louisiana appeals from a judgment of the trial court sustaining a motion to quash the information filed against the defendant.

By amended bill of information, the defendant, Eric Peterson, was charged with the theft of $7,000 from the Baton Rouge Millworks, a partnership composed of Eric Peterson and Herman Green He applied for a bill of particulars, praying for the following information:

1. Was the money in the possession of Herman Green?

2. Under what circumstances did he take or come into possession of the money?

3. If money was not in the possession of Green, in what bank and under whose name was it deposited?

4. What business relationship existed between Green and defendant prior to the alleged theft?

5. Was the partnership agreement written or oral, and when was the partnership formed and when was it dissolved?

The State answered that the partnership was formed on February 20, 1956, by oral agreement of the partners, Eric Peterson and Herman Green; that the money was deposited in the Capital Bank and Trust Company, Baton Rouge, Louisiana, in the names of Eric Peterson and Herman Green; that the alleged theft, consisting of one misappropriation from the Capital Bank and Trust Company, occurred on or about May 18, 1956; and, that there had been no accounting or dissolution of the partnership.

The defendant then filed a motion to quash, averring that--

'* * * the bill of information charges the theft of partnership funds in the amount of $7,000.00; that the answers to the motion for the bill of particulars specifically admit, among other things, that the said funds were partnership funds deposited in the name of Eric Peterson and Herman Green; that the basis of the charge is the withdrawal of said alleged partnership funds on or about May 18 1956, by the said Eric Peterson; that the State admits that no accounting has ever been made or demanded with respect to the partnership property and that no dissolution of the alleged partnership has ever been had. This being true under the Louisiana Law and decision pertaining thereto, the bill of information considered along with the answers to the motion for a bill of particulars does not charge an infraction of the law or commission of any crime.'

To a request for a second bill of particulars, the State answered that the partnership was a commercial one; that the alleged theft occurred when the accused withdrew money of the alleged commercial partnership from the Capital Bank and Trust Company, for the purpose of converting said funds to his personal use; and, that the alleged misappropriation was by means of fraudulent conduct and practices.

Since it is conceded by appellee that the partnership was a commercial one, we are considering it as such.

In sustaining the motion to quash, the trial court stated:

'I have given this matter very careful consideration, and my first impression was that the motion to quash is without merit. However, after carefully studying the case of State v. Hogg, 126 La. 1053 (53 So. 225, 29 L.R.A., N.S., 830), I have reached the conclusion that the motion to quash is well founded and should be sustained. It can be well admitted that a commercial partnership is in the eyes of the law a legal entity. I am of the opinion however that this is so only as between the partnership and third persons. In other words, it seems to me that a third person could be prosecuted under Article 67 of the Criminal Code (LSA--R.S. 14:67) for the theft of partnership funds. However, as I interpret the law as it now exists, the relationship of the individual partners to the partnership is no different than it was when the decision in the Hogg case was handed down. In that case it was in effect held that a partner could not be guilty of a theft of partnership funds, for the reason that as to him the property of the firm is not the property of another in the sense of the law. Here it is obvious that each member of the partnership, which admittedly is or was a commercial partnership, had a proprietary interest in the money alleged to have been stolen. That being true, I am of the opinion that there should be no legal prosecution of the defendant for the theft of the funds on deposit in the name of the individual members of the partnership.'

LSA-Revised Statutes 14:67 provides:

'Theft is the misappropriation or taking of anything of value which belongs To another, either without the consent of the other to the misappropriation or taking, or by means of fraudulent conduct, practices or representations. An intent to deprive the other permanently of whatever may be the subject of the misappropriation or taking is essential.' (Italics ours.)

The following comment is found in the footnotes to the above section:

'This section has the effect of combining the traditional offenses of larceny, embezzlement, and obtaining by false pretenses. In spite of the tremendously complicated nature of the problem as a matter of historical development, there seems to be absolutely no reason why today the fundamental notion that it is socially wrong to take the property of another, in any fashion whatsoever, cannot be stated as clearly and simply as it has been above. There is eminent theoretical and practical authority for this step. See Stumberg, Criminal Appropriation of Movables--A Need for Legislative Reform (1941) 19 Tex.L.Rev. 300.'

It is incumbent that we decide whether the word 'another', employed in the above statute, includes a commercial partnership of which the accused is a partner.

In the case of Henderson's Estate v. Commissioner of Internal Revenue, 5 Cir., 155 F.2d 310, 314, we find the following interpretation of a commercial partnership:

'* * * a commercial partnership is a fictitious person. It is a civil person possessing its peculiar rights and attributes. In contemplation of law it is a separate legal entity, distinct from the individuals composing it, capable of suing and being sued in the partnership name. * * * The law of Louisiana with reference to commercial partnerships is stated by the Supreme Court of that state in Succession of Pilcher, 39 La.Ann. 362, 1 So. 929, 932, as follows: 'In Smith v. McMicken, 3 La.Ann. (319), 322, the court said: 'The partnership, once formed and put into action, becomes, in contemplation of law, a moral being, distinct from the persons who compose it. It is a civil person which has its peculiar rights and attributes. * * * Hence, therefore, the partners are not the owners of the partnership property. The ideal being, thus recognized by a fiction of law, is the owner; it has the right to control and administer the property to enable it to fulfill its legal duties and obligations; and the respective parties who associated themselves for the purpose of participating in the profits which may accrue, are not owners of the property itself, but of the residuum which may be left from the entire partnership property, after the obligations of the partnership are discharged.' City of New Orleans v. Gauthreaux, 32 La.Ann. (1126), 1128.'

'See also Raymond v. Palmer, 41 La.Ann. 425, 6 So. 692, 17 Am.St.Rep. 398; Sherwood v. His Creditors, 42 La.Ann. 103, 7 So. 79; Darden v. Garrett, 130 La. 998, 58 So. 857; Southwestern Gas & Electric Co. v. Liles, 16 La.App. 500, 133 So. 835.'

It is the contention of the State that since a partnership is a legal entity, it necessarily follows that a person--in this particular case, Eric Peterson--can commit a theft from a partnership. It argues that under LSA--Revised Statutes 14:2 a partnership falls under the definition of the word 'another.¹

Partnerships are divided, as to their object, into commercial partnerships and ordinary partnerships. LSA-Civil Code, Article 2824.

LSA-Civil Code, Article 2872, sets forth the extent of liability of partners as follows:

'Ordinary partners are not bound in solido for the debts of the partnership, and no one of them can bind his partners, unless they have given him power so to do, either specially or by the articles of partnership.

'Commercial partners are bound in solido for the debts of the partnership.'

The above article was interpreted as to commercial partners, in the case of E. B. Hayes Machinery Co. v. Eastham, 147 La. 347, 84 So. 898, 900, as follows:

'* * * The liability of commercial partners, while solidary, in the sense that they and each of them may ultimately be required to pay the whole of its debts, yet is not a primary one; neither is it a conventional liability, but one which the law alone imposes, in consequence of the relation of the parties and the character of the business in which the firm is engaged. Until the debt is established contradictorily with the partnership, so long as it exists, there is no debt within the meaning of article 2872 of the Civil Code, which can be enforced against the individual partner. The partnership is a necessary party to the liquidation of such a claim, just as in the case of any other contract in which all parties thereto and having and interest therein are necessary parties; and the individual partner, not being a party to such conventions in his personal capacity, cannot be sued individually until the rights of the debtor and creditor under their agreement have, as between them, been determined, especially when his connection therewith is not one of agreement, but his liability being imposed, as above stated, solely in consequence of the law. On the other hand, when the partnership has been dissolved, it ceases to exist as a separate entity, and the liability of the partners becomes fixed. Montague v. Weil & Bro., ...