Majority
Headnote
1. Partnership—Liability oe Partners—Limitation.Plaintiffs, constituting the firm of Goedecke Bros., and defendants, constituting a firm doing business as the National Button-Works, entered into an agreement for the manufacture and sale of campaign buttons and badges; plaintiffs to make and deliver the dies required in such manufacture, and defendants to assume the manufacture and sale. According to plaintiffs’ version of the agreement, the defendants were to be allowed, out of the gross product of sales, only the cost of manufacture; and the balance was to be divided in the proportion of two-fifths to plaintiffs, and three-fifths to defendants. Defendants, however, claim that they were to be allowed, in addition to the cost of manufacture, the value of goods sold and returned, the traveling and business expenses incurred in promoting sales, stock remaining unsold, and bills remaining uncollectible. Testimony was introduced in support of these several versions of the agreement, the plaintiff Herman Goedecke asserting that it was agreed that, after deducting the cost of manufacture, the division of the remainder of the proceeds of sale was to be made; and defendant Christian Kessler insisting that there was an express understanding to reimburse the defendants for the cost of manufacture, the necessary business and traveling expenses, losses, and goods returned. It was conceded on the part of the defendants that the gross sales amounted to $3,889.54, and much, if not the greater part, of the evidence adduced for both sides was directed to establish the cost of manufacture. One of the plaintiffs’
It is, however, now claimed that the agreement between the parties to share in the profits of a joint adventure constituted them partners, and that plaintiffs were therefore chargeable in law with a proportion of the losses accruing from uncollectible demands in favor of the copartnership. The answer to this claim is that there was evidence of an express understanding that plaintiffs were to be charged only with their proportion of the cost of manufacture, thus excluding all liability for other causes, and the verdict of the jury, in favor of plaintiffs on this point, must be accepted as conclusive. Even among partners, an agreement that one of them shall not be charged with losses resulting from bad debts and ill commodities is valid, and would be enforced. The rule that all the partners must bear such losses does not prevail where the liability of one of them is limited in that respect by express agreement. Another answer is that, if defendants had desired to avail themselves of any legal obligation of the plaintiffs growing out of the peculiar relation
Cases cited
- Cohn v. Goldman 76 N. Y. 284 p. 782
- Mead v. Shea 92 N. Y. 122 p. 782