Noel v. Kinney — 8 N.Y. St. Rep. 575

Majority

p. 575

August Noel et al., App’lts, v. Frederica M. Kinney, Impleaded with John P. Kinney, Resp’t.

(Court of Appeals,

Filed June 7, 1887.)

Headnote

Hxjsband and wipe—Separate estate op wipe—Partnership.

A note was given by John P. Kinney in payment for mirrors placed in houses belonging to his wife, and signed J. P. Kinney & Co., he repsenting that his wife was the sole owner, and that such name was used as a mere matter of convenience in transacting her business. Reid, that the wife was as capable of contracting as if she had been unmarried—as capable of adding to her estate by fresh acquisitions; and she should npt be permitted to escape payment by joining to her own name that of her* hus- or the two into a firm or name

Cases distinguished.

Appeal from an order of the general term ,of the city court of Brooklyn, directing judgment for defendant Frederick M. Kinney.

Nicholson P. O'Brien, for Noel and another, app’lts; G. Storms Carpenter, for resp’t.

The action is upon a note signed “ J. P. Kinney & Co.,” payable to the order of plaintiffs at bank,

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for $505, value received. The complaint contains allegations usual in such cases, and sufficient to charge the defendants as partners under the name affixed to the note. -Frederica M. Kinney alone answered, and her sole defense is that at the time stated she was a marriedwoman, and that the note was executed, and delivered by her husband. But there is no allegation that it was made without her knowledge and consent, nor that it was made without her authority. Upon the trial the plaintiff put the note in evidence, and the defendant proved her marriage with the other defendant. But there was evidence from which the jury might have found that she was the owner of improved real estate in the city of Brooklyn; that the consideration of the note was the purchase-price of mirrors placed in houses built upon her land; and that the mirrors were unpaid for. The note was fairly taken, and the consideration delivered upon the representation by the husband that the wife was the sole owner of the property, and that the name of J. P. Kinney & Co was used as mere matter of convenience in transacting her business. It does not appear ■that there was any business except in relation to the houses.

No question was made as to the authority of defendant’s husband to execute the note, nor as to the truth of his representations.

The defendant Frederica moved to dismiss the complaint upon the ground that as to her the note was invalid, “ its form,” as her counsel stated, “showing it was not given in respect to her separate business or estate.” The trial judge directed a verdict for the plaintiff, subject to the opinion of the court. It was so rendered, but, on motion of the defendant’s counsel, afterwards set aside by the same judge, and judgment ordered for the defendant. Exceptions taken by the plaintiffs to this ruling were directed to be heard in the first instance at general term, judgment in the mean time to be suspended. The general term overruled the exception, and ordered judgment for the defendant.

It is obvious that the contract, in fulfillment of which the note was given, was of value to the defendant, for by it she acquired articles for the improvement of her property. She retains those articles, and has so far avoided payment upon the ground that she and her husband, upon contracting and consummating marriage, became one person, and so incapable of thenceforth contracting one with the other; that, therefore, they could not be partners; and, as the contract sued on was in form a co-partnership contract, it could not be enforced against her. If this is the present rule of law, then the .statutes which enable the woman to acquire and hold property, to bargain sell, assign and transfer it, to carry on any trade or business, and perform any

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labor or service on her own account, and which protect her in the enjoyment of her earnings from her trade, business, labor, or services, and permit her to use and invest those earnings, are effectual only so far that she may, alone or jointly with any person or persons save her husband, derive profit and increase from her work, and gain from the use of her estate. If they are to be so limited in her favor, they may easily, as in this instance, become not merely enabling statutes for her benefit, but also in her hands instrumentalities of fraud.

Upon the precise question presented, the opinion of the court below assumes that the decisions of other courts are conflicting; but we are referred to no case in this court where a woman has successfully asserted her coverture as a defense to an action for the price of goods purchased by her, and I am unable to see why, as against creditors, she should be permitted to interpose the mere form of her promise as an obstacle to their recovery. It is settled that the "things which the statutes above referred to permit her to do in person she may also do by another as her agent. This is necessarily so, for she is allowed to act in respect to them as if unmarried; and it cannot be doubted that the improvement of her land, or the management of her personal property, whether for preservation or business, may be conducted by her by means of any agency which any other owner of property might employ, and that the produce and increase thereof will be hers. Knapp v. Smith, 27 N. Y., 278 , Abbey v. Deyo, 44 N. Y., 344 . So she may do those things through her husband as her agent. Abbey v. Deyo, supra; Rowe v. Smith, 45 N. Y., 230 . She may also have such a community of interest with him in relation to real estate as will render her liable for his frauds relating to it; and when he, professing to act as her agent, makes false representations, although without her knowledge, and she receives the proceeds, she cannot retain the fruits of his fraud. Krumm v. Beach, 96 N. Y., 398 .

Again, as to all contracts relating to her separate estate, or made in the course of her separate business, she stands at law on the same footing as if unmarried, and can, therefore, make negotiable paper which will be governed by the law-merchant, and can be sued upon m the ordinary way by general complaint, and without special statements. Freaking v. Rolland, 53 N. Y., 422 . Nor can she escape liability because she and her husband are joint makers of the note sued on. In Freaking v. Rolland (supra), the action was' upon a joint promissory note signed by the defendants, who were husband and wife. He set up usury, .and she set up coverture. The court directed a ver

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diet for the wife, and the jury gave a verdict against the husband. The creditor appealed. The general term affirmed the verdict in favor of the wife, and the creditor appealed to this court. Against the appeal it was argued (1) that, being a married woman, she was not hable for the note in suit; (2) that the complaint, being general and not specific, was insufficient to charge her property. Neither objection prevailed, and the judgment in her favor was reversed. There the husband acting for himself, and as the agent of his wife, borrowed money with which to pay. for a factory bought by her. The money was loaned to them, and was in part so applied. The note was given for the money loaned and for services. The court, in answering the defendant’s objections, show that the capacity of a married woman to make contracts relating to her separate business is incident to the power to conduct it, for the latter would be barren and useless if disconnected with the right to conduct it in the way and by the means usually employed. In the case cited she became a joint contractor with her husband, but she was as much bound to perform the joint engagement as if the undertaking had been several, and she did not escape liability because her joint contractor was her husband. It was not necessary to inquire in thqt case whether the one paying could obtain contribution from the other, nor is it necessary to go into that question here. In that case both undertook to pay the creditor; in this case both undertook to pay the creditor. Can it make a difference in the measures of liability that in one case the married woman entered in her own name and her husband in his name in the execution of. a joint obligation, and in the other case a name which represents also joint liability, but which may in effect also be several ?

Partners are at once principals and agents. Each represents the other, and if, in the relation of partnership, there are obligations which a married woman cannot énforce againt her husband, or the husband against the wife, they involve no feature of the present action, which asserts only the obligation of a debtor to discharge her debt, or the obligation of a promisor to fulfill her promise. More like the present case is that of Scott v. Conway ( 58 N. Y., 619 ), where, in an action for the price of labor and materials supplied to a theatre carried on by Sarah T. Conway and her husband, Frederick B., under the name of “ Mrs. F. B. Conway’s Brooklyn theatre,” and in which the wife and husband were jointly interested, it was held to be no defense, against one who dealt with her in ignorance of the partnership, that she had a dormant partner, and that the rule was not changed by the fact, that the partner was her husband. In Bitter v. Rathman ( 61 N. Y., 512 ), it was held

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that a married woman who, in secret trust for her husband, becomes a member of a co-partnership, is to be regarded as the owner of the interest she represents, and might maintain an action for the dissolution of the co-partnership and for an accounting. The defendant in that case denied that she was a partner, and claimed that he alone was interested in the business; claiming that, being a married woman, she could not in law be his partner. The court held otherwise, and also that, having suffered herself to be regarded by the public as a partner, she was hable as such to the creditors of the ostensible firm, although it might he otherwise as regarded her husband and his creditors, but as to any liabilities of the ostensible firm she would be entitled to protection as against the defendant and her husband.

It would seem, therefore, that by becoming a partner either with a husband or another person, a married woman loses no right of property. And no principle is suggested upon which her estate can be increased at the expense of creditors, nor how either in her own name, or in her own name and that of another, or with another, she can purchase goods on credit to the advantage of her separate estate, and not become hable for its payment. In Coleman v Burr ( 93 N. Y., 17 ), cited by the appellant, the sole question was whether the conveyance of property by the husband to his wife was sustained by a consideration good as against his creditors who impeached it. Here the wife was as capable of contracting as if she had been unmarried ■—as capable of adding to her estate by fresh acquisitions; and she should not be permitted to escape payment by joining to her own name that of her husband, or by combining the two into a firm or partnership name. It was by that name she chose to contract, and, as between herself and creditor, she is bound by it. Individuals may be liable as partners to third persons, while, as between themselves, they are not.

Here, then, the question is not between husband and wife. Assume that as to and with him she has no capacity, it by no means follows that she shall not be held upon a contract made by him upon a consideration moving to her, where a third person, who parted with that consideration in rebanee upon the husband’s apparent agency, seeks to enforce the contract. If the adoption of a firm name was a mere contrivance to carry on the business jointly, and at the same time to put the property acquired and added to the wife’s separate property out of the reach of creditors dealing with either bona fide as the partner of the other, it should not be permitted to have that effect. If, as the testimony shows, the wife was the sole owner of the property, that the husband had no interest in it, but that

p. 580

for convenience they were doing her business in the name of J. P. Kinney & Go., her liability for a debt contracted in that name is entirely consistent with the fact, if it be a fact, that, as between the parties themselves, no partnership exists. This is so, although the plaintiff alleges in the complaint that the defendants are partners, and that allegation is not denied. For the purposes of the action it may be true. The plaintiff gave credit to them as such, but the goods he sold were intended by them to be annexed to the wife’s separate estate, and they were so annexed. If the arrangement was valid between all parties, there is no pretense of a defense. If invalid only as between the defendants, the wife, who received the fruits of the transaction, cannot, as against a creditor, assert its invalidity. Although married, she may be estopped by her acts and declarations in any matter in respect of which she is capable of acting sui juris. Bodine v. Killeen, 53 N. Y., 93 . In this instance the plaintiff proved the contract, that it was made by her authorized agent, and that it had reference to the improvement and benefit of her separate estate. She had capacity to do all these things, and, if the arrangement which led to the use of her husband’s name as joint promisor or partner was beyond her power to enter into, she must meet that liability without regard to any question whether her husband is also Hable, or as to what rights of indemnity or otherwise she might have against him. She was a principal, and he was her agent. He neither exceeded his power, nor were her acts to his prejudice, and if, by reason of any technical incapacity, they could not contract with each other or together, as constituting that artificial entity, a firm or copartnership (a question we do not decide), she is liable, and the contract enforceable against her in favor of the plaintiff, whose property has been added to her estate upon the strength of a promise made in her name by her authorized agent.

We think the court erred in directing judgment for the defendant. It should be reversed, and the plaintiff have judgment upon the verdict. .

All concur.