Thayer v. Goss

• Decision Date: 26 September 1895
• Citation: 64 N.W. 312,91 Wis. 90
• Parties: THAYER v. GOSS ET AL.
• Court: Wisconsin Supreme Court

91 Wis. 90

64 N.W. 312

THAYER

v.GOSS ET AL.

Supreme Court of Wisconsin.

Sept. 26, 1895.

Appeal from circuit court, Pierce county; E. B. Bundy, Judge.

Action by Lottie Thayer against Alfred J. Goss and J. B. Goss on a note executed to plaintiff by J. B. Goss & Co. From a judgment for plaintiff, defendant Alfred J. Goss appeals. Affirmed.

This action was brought against Alfred J. Goss and J. B. Goss, as copartners under the firm name of J. B. Goss & Co., upon a promissory note signed by that name, dated April 19, 1893, payable on demand to the plaintiff, with interest, etc., charging, in substance, that the defendant J. B. Goss was the ostensible and active managing member of a firm doing a milling business at River Falls, Wis., and that the said firm was composed of the said J. B. Goss and Alfred J. Goss; that the plaintiff believed, when she took the said note, that the consideration for it was money loaned to the former firm of J. D. Putnam & Co., consisting of J. D. Putnam and the defendant Alfred J. Goss, which firm was dissolved November 3, 1891, when the firm of J. B. Goss & Co. was formed, and the property and effects of the former firm were transferred to it, and it assumed and agreed to pay the debts of said former firm; that the plaintiff, at the request of the said J. B. Goss & Co., surrendered the note of J. D. Putnam & Co. for said loan, and, relying on the promise and credit of the said firm of J. B. Goss & Co., took the note sued on in lieu thereof. The defendant J. B. Goss made default, and the defendant Alfred J. Goss answered, admitting the allegations in respect to the existence and dissolution of the firm of J. D. Putnam & Co., but denying that any firm or partnership of J. B. Goss & Co. was formed, or that he was ever a member of any such firm, or that the property and effects of the firm of J. D. Putnam & Co. were ever transferred to the firm of J. B. Goss & Co., or that it assumed or agreed to pay the debts of the former firm; and he alleged that the business carried on under the name of J. B. Goss & Co. was the private business of the said J. B. Goss, in which he, the defendant Alfred J. Goss, had no interest. At the trial by the court it was found, among other things: (1) That prior to November 5, 1891, the defendant Alfred J. Goss and J. D. Putnam were doing a milling business together as copartners under the firm name of J. D. Putnam & Co. (2) That on that day the partnership was dissolved, and the said Putnam and the defendant Alfred J. Goss signed and caused to be published, at the place of said business, a notice as follows, to wit: “Notice of Dissolution. Notice is hereby given that the copartnership formerly existing between the undersigned, J. D. Putnam and Alfred J. Goss, under the firm name of J. D. Putnam & Co., is this day dissolved by mutual consent, and the business will in the future be carried on under the firm name of J. B. Goss & Co., who will settle all claims of the late partnership. J. D. Putnam. Alfred J. Goss. November 3rd, 1891.” (3) That it was then understood that the partnership property should be conveyed to the defendant J. B. Goss, and that he should carry on the said business, and pay the debts of the firm of J. D. Putnam & Co., doing business under the name of J. B. Goss & Co.; but by mistake the property was conveyed to the defendant Alfred J. Goss, who, pursuant to said agreement, afterwards conveyed it to the defendant J. B. Goss, and he carried on the business under the name of J. B. Goss & Co., having no partner. That there was in fact no partnership existing between the defendants, and Alfred J. Goss had no interest in the profits of the business of J. B. Goss & Co. as partner. (4) That the note sued on was executed in the manner and for the consideration set forth in the complaint, and the plaintiff, when she took the same, understood and believed that J. B. Goss & Co. was a firm consisting of J. B. Goss and Alfred J. Goss, and that there was such a holding out by the said Alfred J. Goss as to induce her to so believe, and to act upon such belief. As a conclusion of law the court held that the plaintiff was entitled to judgment against both defendants for the amount of the note and costs. Aside from the proof of the signing and the publishing of the notice as before stated, it appeared in evidence that the plaintiff saw the published notice in the River Falls Journal, and she testified that she believed that the defendant Alfred J. Goss still continued in the business, but she had never heard any one say so; that she believed that J. B. Goss and Alfred J. Goss continued the business. From the judgment on such finding the defendant Alfred J. Goss appealed.Spooner, Sanborn, Kerr & Spooner, for appellant.

F. M. White, for respondent.

PINNEY, J. (after stating the facts).

The familiar and well-settled rule is that a dissolution of the copartnership by act of the parties, whether a complete discontinuance of the concern or the retirement of a single partner or addition of a member, does not affect the outside world, unless proper notice is given; that actual notice must be brought home to former customers, or those who are creditors by having dealt with it, but notice by publication is sufficient as to all others. Bates, Partn. § 606; 1 Lindl. Partn. *221. The plaintiff must be regarded as a former customer or dealer with the firm of J. D. Putnam & Co., and, as such, entitled to actual notice, she having loaned them money, though but in a single instance, for which she was then their creditor. She comes within the reason of the rule. Bates, Partn. § 613; Bank v. Howard, 35 N. Y. 500; Lyon v. Johnson, 28 Conn. 1; Wardwell v. Haight, 2 Barb. 553;Vernon v. Manhattan Co., 22 Wend. 191;Bank v. Norton, 1 Hill, 577. The ground upon which notice of the discontinuance of the concern by act of the parties or the retirement or addition of a member is required is stated as arising from a species of estoppel to deny the continuance of the agency of each of the partners for the firm, or on the ground of negligence whereby credit is given, or from a presumption of a continuance of the former relations, giving to one who once knows of the existence of a firm the right to assume that it remains the same, so that, until proper notice of dissolution, a partner's attitude is like that of a partner by holding out. Bates, Partn. § 607; Vernon v. Manhattan Co., 22 Wend. 192, 193. In Scarf v. Jardine, 7 App. Cas. 349, it is stated that the principle upon which those who have dealt with the firm before a change took place are entitled to...