Third Nat. Bank of Sedalia v. Fults

• Decision Date: 04 December 1905
• Citation: 115 Mo. App. 42,90 S.W. 755
• Parties: THIRD NAT. BANK OF SEDALIA v. FULTS et al.
• Court: Missouri Court of Appeals

90 S.W. 755

115 Mo. App. 42

THIRD NAT. BANK OF SEDALIA v. FULTS et al.

Kansas City Court of Appeals. Missouri.

December 4, 1905.

1. PARTNERSHIP — NONTRADING FIRM.

A firm engaged in contracting with the government for carrying mail is a nontrading partnership.

2. SAME — FIRM NOTES — LIABILITY OF PARTNERS.

Partners in a nontrading partnership are not bound by notes executed in the firm name by other partners, unless there is previous express authorization or subsequent ratification.

3. SAME—ACTION—INSTRUCTIONS.

In an action on notes signed by a nontrading firm, an instruction that one of the partners, who did not sign the notes, could not be held unless the notes were given for firm purposes or were authorized by that partner, was not in conflict with an instruction that if there was no firm having the name which was signed on the notes, there could be no recovery against the partner mentioned, though he was a member of a firm composed of himself and the other defendants, unless he consented to or knew of the use of the firm name on the notes.

4. SAME—OUSTOM—HARMLESS ERROR.

In an action on a note signed by a nontrading partnership, proof of a custom of other similar partnerships to execute notes signed by all the partners did not justify submission to the jury of the question whether a partner who did not sign the note was liable thereon because of the custom; but the error did not injure plaintiff.

5. SAME—MANAGING PARTNER—AUTHORITY.

Authority to a member of a nontrading firm to conduct the firm business does not empower him to bind the other members by notes signed with the firm name.

6. EVIDENCE—HEARSAY.

In an action against alleged partners on a note, evidence as to what one defendant told plaintiff's officers as to another defendant being a member of the firm was properly stricken out as hearsay.

7. PARTNERSHIP — NONTRADING FIRM — LIABILITY OF PARTNER ON NOTE—EVIDENCE.

Upon an issue as to the liability of one alleged member of a nontrading firm on a note executed in the firm name, evidence that before the execution of the note two of the other partners asked the cashier of plaintiff bank if they could get money, making no mention of the member whose liability was disputed, was proper.

8. TRIAL — MISCONDUCT OF PARTIES—STATEMENT IN PRESENCE OF JUROR.

In an action against members of a firm on a note, a statement by one of defendants to a witness in the presence of some of the jurors that another defendant who denied liability ought not to be compelled to pay, which statement was not shown to have been made for any improper purpose or to have influenced the jury or been designed to do so, did not require the granting of a new trial after a verdict in favor of the partner denying liability.

Appeal from Circuit Court, Pettis County; Geo. F. Longan, Judge.

Action by the Third National Bank of Sedalia against D. A. Fults and others. From a judgment for plaintiff against certain defendants, but in favor of defendant J. C. Beedy, plaintiff appeals. Affirmed.

James T. Montgomery, for appellant. Barnett & Barnett and Chas. E. Yeater, for respondents.

ELLISON, J.

This action is based on a petition containing eight counts, each on a separate promissory note for borrowed money, and a ninth count on an over draft. The judgment in the trial court was for the defendant Beedy, and against the other defendants, on each of the counts. The notes are signed, D. A. Fults & Co., J. A. Fults, D. A. Fults, and J. D. Franklin. Defendant Beedy is sought to be held, on the ground that he was a member of the partnership of D. A. Fults & Co. The only contest here is as to his liability. The business of the partnership of D. A. Fults & Co. was contracting with the federal government for transportation of the mail over certain mail routes. One of the Fults bid for such contract, and, after securing same, would frequently sublet to others. The defendants, including Beedy, became interested in these, and divided the profits, though Beedy does not admit himself to have been a partner as charged. We shall, however, assume that he was a partner. It is clear from the business of the firm and the evidence heard that it was what is known as a nontrading partnership. The trial court properly so declared in an instruction. It is determined as law that partners in a nontrading firm have no implied power to bind one another by commercial paper executed in the name of the firm. To make such paper binding, the party seeking to hold other members must show, either previous authorization, or subsequent ratification. Deardorf v. Thacher, 78 Mo. 128, 47 Am. Rep. 95; Webb v. Allington, 27 Mo. App. 559; Randall v. Lee, 68 Mo. App. 565; Stavnow v. Kenefick, 79 Mo. App. 44.

But plaintiff complains of the action of ...