Secor v. Keller — 11 N.Y. Super. Ct. 416

Majority

p. 416

William Secor v. Thomas Keller.

Headnote

The terms of § 111 of the Code, that “every action must he prosecuted in the name of the real party in interest,” are imperative, and are subject to no exceptions other than those stated in § 118. Hence, since the Code, even a dormant partner is a necessary party as a plaintiff in an action for the recovery of a partnership debt, founded on a partnership contract, -whether the relief sought be legal or equitable.

Each partner is not a trustee for his copartners, and hence is not a trustee of an express trust, within the meaning of § 118 of the Code.

Judgment dismissing complaint affirmed, with costs.

(Before Oaklet, Ch. J., Campbell and Hoffman, J.J.)

March 5; March 24, 1855.

Appeal by the plaintiff from a judgment dismissing the complaint, with costs.

The complaint alleged that the defendant was indebted to the plaintiff in the sum of $128.25, for work, labor and services performed, and also for certain articles and materials furnished, at the instance and request of the defendant. The answer {inter alia) averred “ that the work, labor, &c., done and performed for, and

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the materials furnished, to the defendant mentioned in the complaint, were furnished and performed by the plaintiff and his then copartner (whose name is unknown to the defendant) and yipon their joint account, and for their joint benefit,” &c.

The cause was referred, upon the pleadings, to H. W. Robinson, Esq., as sole referee. The referee made the following general report:

“ To the Justices of the Superior Court of the city of New York:

“ I, Hamilton W. Robinson, the referee appointed to hear and determine this cause, do report, that I have been attended by the respective parties, and heard their proofs and allegations, and do find the following to be the facts: That in March, 1852, the plaintiff and one George Zingsem were conducting and carrying on the business of manufacturing faucets and cocks, in the city of New York, as partners, under the' name of William Seeor, and that such firm, from the 20th to the 24th day of that month, sold and delivered the defendant, upon credit, goods to the amount and value of one hundred and four dollars and twenty-five cents.-; that said Zingsem was then and still is interested as partner in the claim for said debt, and I do find the issue presented by the pleadings, in favor of the defendant; and, as a matter of law, I do find and determine, that the omission of said Zingsem as a party to this suit is material, and that this action cannot be maintained in the name of the plaintiff alone.

“ And I do further find, that the plaintiff is not the trustee of an express trust, within the meaning of § 118 of the Code of Procedure, and that the complaint ought to be dismissed with costs.

“ All of which is respectfully 'submitted.

“ July 27th, 1853. H. W. Robinson.”

Judgment was entered upon this report at a Special Term in November, 1854, in favor of the defendant, dismissing the complaint, and for the sum of $101.50 as his costs and disbursements.

J. G. Dimmiclc, for the plaintiff,

in moving for a reversal of the judgment, insisted upon the following points and authorities:

I. There was no necessity, at common law, to make Zingsem

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a party plaintiff to the action, he being only a dormant partner. (Platt v. Halen, ' 23 Wend. 456 ; Clarlcy. Miller, 4 Wend. 628 ; Kelly v. Hurlburt, 5 Cowen, 534; Collyer on Partnership, Perkins’ Edition, § 4.)

II. The Code does not require that Zingsem should he joined as a plaintiff with Secor. (Code, § 113; Grennell v. Schmidt, 3 Code Rep. 19 ; Pirson y. Warren, 14 Barbour, 488; See page 491, &c.) 1. Ho change in the common law is presumed, further than the case absolutely requires. (1 Kent’s Com. page 464.) 2. The object of the Code was simply to reform the practice, without interfering with existing rights, and in relation to parties, to require parties to be brought before the court who had rights to be protected, when there was no suitable person before the court to protect them. 3. But when the law had appointed proper representatives, as in the case of executors, &c., or when the parties themselves had appointed other persons to act for them, as in the case of commission merchants, factors, or the ostensible partner acting on behalf of himself and the dormant partner, there no change was contemplated; the case required none.

III. The rule, as held by the referee, prevents any person from being a dormant or secret partner, no matter how laudable the motive or great the exigency requiring it; such a radical change in the law and rights of the parties certainly was not contemplated to be brought about by a mere change in the practice of the courts, and the court should prevent a mere rule of practice from being construed as making such sweeping changes in general principles of law.

H P. Townsend, for the defendant,

argued in support of the judgment, as follows:

There was a defect of parties plaintiffs, and this defect was made a distinct issue by the answer of the defendant. (Code, §§ 144,145.) The referee having found that the plaintiff and one Geo. Zingsem, sold and delivered to the defendant the goods and chattels, from the sale and delivery of which the indebtedness alleged in the complaint arose, that said Zingsem was then, and is still, interested as partner in the claim for said debt; he, prop.erly and necessarily, from the premises, found the issue presented by the pleadings, in favor of the defendant.

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. Whatever doubts there might have been, as to the necessity'”of making Zingsem. a party plaintiff, had the action been brought before the Code, there can be no doubt but that the said Zingsem "was a necessary party plaintiff, under the rule established by the Code; and this even although he may have been a dormant, or secret partner. (Code, §§ 111, 117, 119.)

The plaintiff was not the trustee of an express trust, within the meaning of section 118 of the Code.

As regards partnership property, neither partner can be said to hold any share or portion thereof in trust for the benefit of any other partner, and this whether the partnership be secret, or otherwise. Partners are not joint tenants, or tenants in common. The estate which each possesses, is peculiar to the relation existing between the parties. A partner is neither the owner of an undivided moiety of the whole property, nor the owner of the whole of an undivided moiety. The partners are joint owners of the whole. There is no portion of the property which can be exempted from this joint ownership; no portion which a known partner can be said to hold in trust for a secret partner. If the relation exists, whatever may be its character as regards the world as between themselves, all the partners are joint owners of every particle of partnership property. Each has a concurrent right to the whole; he holds all in common, nothing separately by himself. (Story on Partnership, §§ 90, 91.)

By the Court.

It may be admitted, as the counsel for the plaintiff contended, that as the law stood before the Code, a dormant partner was not a necessary party in an action at law for the recovery of a partnership debt, except in those cases in which he was known as a party to the contract from which the debt arose. (2 Sand. 324; 3 Cow. 85 ; 4 Cow. 117 ; 23 Wend. 456 ; Collyer on Part. § 393.) But it is not denied that in all suits in equity for the benefit of a partnership, every partner, active or dormant, open or secret, having any interest in the subject in controversy, was held to be a necessary party; and we agree with the referee, that it is the rule which prevailed in courts of equity that the Code has adopted and made universal. The terms of section 111 of the Code, that “ every action must be prosecuted in the name of the real party in interest, except as other

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■wise provided in section 113,” are plainly imperative, and it follows, that as Zingsem was a real party in interest, this action ought to have been brought in his name, as well as in that of the plaintiff.

It has never been supposed, that one partner is a trustee for his copartners, in any sense of the term that has ever prevailed at law or in equity, and we, therefore agree with the referee, that the plaintiff cannot maintain the action as “trustee of an express trust,” within the meaning of § 113 of the Code. We do not, however, mean to say, that a contract in writing may not be só framed as to constitute one partner a trustee for his copartners, within the provisions of that section; but such is not the case before us.

The judgment dismissing the complaint, must be affirmed, with costs.

Cases cited

Clark v. Miller 4 Wend. 628 N.Y. Sup. Ct. p. 418