Emerson v. Parsons — 32 N.Y. Super. Ct. 447

Majority

p. 447

JESSE M. EMERSON, Plaintiff and Appellant, v. MILO H. PARSONS and LEVI S. PARSONS, impleaded, Defendants and Respondents.

[Decided June 4, 1870.]

Headnote

An instrument given by one partner to his co-partners, certifying that he had purchased their interest in the firm, and agreeing to assume all liabilities of the firm and hold them harmless, is some evidence that the partnership was dissolved on the day of its date.

Before Barbour, C.J., Jones and Spencer, JJ.

Appeal from a judgment.

This case was tried before Mr. Justice Monell and a jury.

The point chiefly litigated on the trial was whether the defendants, Milo H. Parsons and Levi S. Parsons, who defended this action, were liable with Edward F. Baker, also made a defendant, but who did not defend.

The solution of the point turned on the question whether a copartnership which had been entered into by the three, under the firm name of E. F. Baker & Co., was dissolved on the 3d of September, or the 5th of December, 1867; the contract out of which the demand in suit arose having been made personally with Baker between those dates, and plaintiff not having dealt with the firm prior to the first date.

On this point the evidence was substantially as follows :

Defendant Milo H. Parsons testified that the partnership was dissolved the 3d or 5th of September, by mutual agreement, and that the dissolution was in writing. The writing was then offered in evidence. Plaintiff objected to its reception, the objection was overruled, and plaintiff excepted.

The writing was as follows:

This is to cebtify that I have purchased the interest of M

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H. Parsons and Levi S. Parsons in the firm of E. E. Baker & Co., and I hereby agree to assume all liabilities of the said firm, and hold M. H. Parsons and Levi S. Parsons harmless.

E. F. Bakes.

Signed in presence of

A. S. Quackenbush.

Hew York, September 3,1867.

; Eive-cent :

: U. S. Rev. Stamp :

: Uncancelled. :

On his cross-examination the witness was asked, “Did the company, E. F. Baker & Co., assume, after September 3, to sell out to any body an interest in that matter ? ” His answer was: At the date of that paper, when this dissolution was made, Mr. Baker said to us that he would have a partner, and wished to continue the business under the same firm name of “ E. F. Baker & Company.” We had some days previous to September the 3d, informed Mr. Baker that we did not want to continue the business any more, that we were dissatisfied with it, and should not do anything more in relation to it. He said, “Very well,” that he had a party in view who would be very glad to take hold of it. Q. Did the old firm, Baker, your brother and yourself, afterwards assume to sell out to another person the interest in this matter ? A. We did, by way of transfer.

Plaintiff then read in evidence a paper of which the following is a copy:

Dissolution oe copartnership.—The copartnership heretofore existing under the name, style, and firm name of E. F. Baker & Co., of Ho. 141 Maiden Lane, in the City of Hew York, is hereby dissolved by mutual consent, and E. F. Baker is fully authorized to liquidate and settle all of the outstanding affairs of the said firm. The above firm of E. F. Baker & Co., as aforesaid, have this day sold and transferred all their right, title, and interest in and to “ Baker’s Hoof Liniment,” and all of the other articles heretofore manufactured and sold by them, to the

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“ Baker’s Hoof Liniment Manufacturing Co.,” of the City of New York, organized November 22, 1867.

E. F. Baker. [l. s.] M. H. Parsons, [l. s.] L. S. Parsons, [l. s.]

Dated New York, December 5,1867.

He also read in evidence a bill of sale, dated December 5, 1867, executed by Edward F. Baker, Milo H. Parsons, and Levó. S. Parsons, under seal, reciting that they comprised the firm of Parsons & Co. and E. F. Baker & Co., and transferring to the Baker’s Hoof Liniment Manufacturing Co. all their right, title, and interest in and to a certain secret or process for compounding, manufacturing, and vending the article known as Baker’s Hoof Liniment, together with the copyright, trade-mark, stock on hand, and also the secret or process for the manufacturing and compounding “Baker’s Condition Powders,” and “ Baker’s Union Leather Preservative,” and also a full and complete list of all the agents vending the same, and their places of residence and business.

' The witness Milo H. Parsons, on his cross-examination, testified in regard to the paper of December 5 as follows:

Q. How did you come to execute that paper on the 5th of December ? A. By a previous agreement with Mr. Baker at the date of September 3, when the dissolution was made, which was read. Mr. Baker said to us, “ I intend to get another partner in this business, and wish to keep the firm name the same,” but did not wish us to advertise the dissolution at that time because he wished to advertise the dissolution of copartnership at the same time with the partnership he said he was about to form, in order to keep the business in the same firm name. Mr. Baker said, “As soon as I get this, gentlemen—it will not be very long—you will have no hesitation to allow me to transfer these things to whomever I wish.” I had a conversation with Baker myself, and from time to time I saw Baker; he said the next day or the next week he hoped to do that. On the 5th of December, at the time this was executed, Mr. Baker came to us and said he had

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made an arrangement with a party to take hold of this thing, and he wished to transfer it. We had nothing to do with the business after the 3d of September, but lived where he carried on his business.

This paper was executed to carry out that understanding; it was distinctly understood by Baker, as well as ourselves, that it was not intended for any other purpose; it was simply to transfer that into the hands of the company.

Levi S. Parsons was called and testified substantially the same as Milo.

In rebuttal plaintiff called William Youngblood, who testified that he presented the account in suit to the defendants Parsons, and asked them if Baker was the partner; they said he had not been since the 5th of December, that previous to that he was.

Milo H. and Levi S. Parsons were recalled, and each testified that he never said to Youngblood that he had not been a partner with Baker since December 5.

The judge charged the jury that there was evidence that on the 3d of September, the partnership was dissolved, “ that the evidence is contained in the instrument certifying to the purchase by Mr. Baker of the interest of his copartners in the firm, and .■also the evidence of a parol dissolution of the partnership made .at the time, which latter would be sufficient without any writing. It is competent for parties to dissolve a partnership by parol, and it is not necessary that the dissolution should be in writing. If, therefore, the jury believe that the dissolution did take place upon the 3d of September, then there is no cause of action made out against these two defendants. But there is some evidence tending to show that there was not in reality a dissolution of the partnership on the 3d of September, and that the dissolution did not in fact take place till the 5th of December.” He then adverted to the evidence which tended to show that the dissolution did not take place until December 5, and wound up ¡by .charging: “ It is for you to say from this evidence whether the dissolution took place on the 3d of September. If that was a mere simulated or pretended dissolution, and the

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dissolution did not in reality take place until the 5th of December, then the plaintiff is entitled to recover the amount he claims in this action.”

The jury rendered a verdict for the defendants. A motion was made for a new trial on the judge’s minutes, which was denied.

Judgment was afterwards entered in conformity with the verdict.

Plaintiff appealed from the judgment and the order denying the motion for a new trial.

Mr. E. D. Culver for appellant.

The court erred in receiving as evidence the writing of 3d September.

It was only the certificate or out of court statement of one of the parties that he had (in time past) purchased the interest of the other two.

It was not signed by all, but merely by one alone, and hence not a dissolution.

It was a secret transaction—no publicity of it given, and none intended to be given.

It was therefore a fraud on their creditors and the public.

The evidence of dissolution on the 5th December was overwhelming and controlling, because it was a complete, entire dissolution, by the solemn act of all the parties, under their hands and seals.

They entitle it “ Dissolution of Copabtoebship,” showing it had not before been dissolved.

They call it a partnership “ existing,” that is on 5th December, showing that it had not to that time terminated.

They all declare it “is hereby (that is by this act) dissolved,” showing it had not been dissolved before, or by any other act.

In the same article of “ dissolution” they all declare that they “have this day” that is, the 5th December, and not the 3d of September, “ sold and transferred ” their interest, title, etc., to the new company.

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In the bill of sale they again all declare under their hands and seals “ That we, Edward F. Baker, Milo H. Parsons and Levi S. Parsons, comprising ” (in the present tense, on the 5th December) “ the firm of Parsons & Co., and E. F. Baker & Co., do grant, sell and convey,” etc., to the new company, all the assets, etc., binding themselves by covenants to warrant and defend the sale, etc.

How does all this tally with the pretence of a dissolution on 3d September ?

That pretence is falsified by every act and word of the parties on the 5th December, in their articles of dissolution, and in the bill of sale of that date.

Mr. Edward Patterson for respondents.

Hot only in this case is there written evidence of Baker’s purchase of Parsons’ interest on 3d September, but there is the positive testimony of both Parsons that an actual dissolution did take place on that day.

The jury have so found on this evidence, and unless it can be overcome by some stronger evidence (and all that can militate against it is the instrument of December 5th, 1867, which both Parsons have explained) the finding of the jury must be sustained. To do otherwise in such a case as this would be to destroy the function of the jury.

To warrant disturbance of a verdict there must be such prepondera/nce of evidence as to induce the belief that the verdict was the result of prejudice, passion, or mistake (Allgro v. Duncan, 24 How., 212 ; Murphy v. Boker, 3 Robt. R., 1; Townsend Manfg. Co. v. Foster, 51 Barb., 350 ; Hall v. Morrison, 3 Bosworth, 520; Lewis v. Blake, 10 Bosworth, Monell, J.).

There was no error at the trial, either in the admission of testimony or in the charge of the judge.

On the appeal from the judgment, the only questions of law to be considered are upon matters arising under exceptions taken at the trial (Morrison v. N. Y. & N. H. R. R. Co., 22 Barb., 571 ;

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Ingersoll v. Bostwick, 22 N. Y., 425 ; Hunt v. Bloomer, 13 N. Y., 341 ; Wheeler v. Garcia, 40 N. Y., 585 ).

The purchase by Baker effectually determined the partnership (Marquand v. N. Y. Manfg. Co., 17 Johns., 527 ).

The paper of September 3d was the evidence of the purchase by Baker, and taken in connection with the independent testimony of L. S. and M. H. Parsons, of verbal agreement to dissolve on 3d September, it was proper to connect date of verbal dissolution with date, of purchase.

That it was properly admitted, also appears thus:

The only issue was as to acts between Baker and Parsons, viz., dissolution of their firm.

That fact could be established in either of two ways, by written or verbal evidence of the purchase.

The best evidence of which the case, in its nature, was susceptible, was the written evidence, the instrument of September 3d.

That evidence, proved by the subscribing witness, was produced, and as it related most pointedly and peculiarly to the issue, it is not easy to see how it could have been rejected.

By the Court:

There is no error in the charge of the judge. The paper of September 3, 1867, does contain some evidence of a dissolution on that day. That is all that the judge charged. There was sufficient conflict of evidence on the question as to whether a dissolution took place on the 3d of September, or not until the 5th of December, to carry the case to the jury. The judge, very fairly, left that disputed question of fact to the jury; and there is no ground for disturbing this verdict.

Judgment affirmed, with costs.

(dissenting). The testimony of Milo H. Parsons shows that if there was any agreement on the third of September by which the partnership was dissolved, such agreement is to be found in the written instrument or certificate signed by E. F.

Dissent

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Baker, and there only. His examination upon that question was as follows:

“ Q. When was that partnership dissolved ?

cc A. The forepart of September, sir.

“ Q. How was it dissolved ?

“ A. By rrmtual agreement between Baker and us.

“ Q. In writing ?

“ A. Yes, sir.

“ Q. It was dissolved by an agreement in writing ? .

“A. Yes, sir.”

The statement of Hilo Parsons, as well as that of Levi Parsons, to the effect that the partnership was dissolved on the third of September, must, therefore, be taken and understood to be the mere expression of the opinions of those witnesses as to the legal effect of the written instrument which, they say, embodied the agreement of dissolution.

As the language of the paper is unambiguous, its legal intent and effect must be determined, as matter of law, by the court.

I will not waste words in the discussion of the question as to whether the phrase “ the interest of M. H. Parsons and Levi S. Parsons in the ji/rm of E. F. Baker and Co.,” was designed to cover their interest in future profits and acquisitions, or only the property of which the firm was then the owner, for I am satisfied that the written instrument cannot, properly, be held to be an agreement between the partners in the firm dissolving the co-partnership, nor to constitute any evidence of a purchase by Baker, operating, in law, a dissolution.

First.—Even if we concede that Baker, in and by the paper in question, acknowledged that he had purchased all the interest and property, present and prospective, of his partners in the firm, and assuming, as we then may, that such purchase, if madé, operated in law and was a dissolution of such firm, still that paper does not constitute any legal evidence of the'purchase. If the purchase was made and perfected by means of a bill of sale or other written instrument, the paper itself, with proof of its delivery, would, if in existence, be the best and only evidence of

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the fact; or, if not in writing, the bargain should be proven by some person who made or heard it. The mere certificate of the purchaser in such a case neither conveys to him a title nor is any evidence in an action against the firm that such purchase has been made.

Second.—The written instrument does not purport to be an agreement whereby the partners in the firm consent and mutually agree to a dissolution thereof.

Third.—It is not, m fact, an agreement at all. To constitute an agreement in writing between the partners, either dissolving the partnership or for any purpose, the signatures of all the parties thereto were essential, while the paper in question was signed by Baker only.

Fourth.—The paper is really nothing more than the written statement of one of the defendants in this action of a fact, and could not, properly, be read in evidence by the defendants, or either of them, in a suit against the firm to establish the fact therein stated, or for any purpose.

It appears to me, therefore, that the learned judge erred in admitting the paper as evidence, as well as in his charge to the jury upon the subject.

That error, however, would not entitle the plaintiff to upset the judgment if the evidence in the ease dehors the written instrument was sufficient to establish the fact that the partnership was dissolved on the third of September. But, I think it was not; for the defendants,having proven that the agreement by which the firm was dissolved was committed to writing, were precluded from proving such agreement otherwise than by its production; and the moment it appeared upon the trial that the agreement of dissolution was in writing, the statements contained in that instrument constituted the only evidence of the fact that the jury were authorized to consider (1 Greenleaf Ev., sec. 87). Besides, as the witnesses who state that the firm was dissolved on the third of September by an agreement between the parties also say that such agreement was in writing, although the writing produced by them does not constitute an agreement nor provide

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for a dissolution, we cannot assume, as matter of law to be determined here, that those witnesses were not equally mistaken in supposing that any agreement was then made by which the firm was dissolved, more especially when we consider that they do not testify to the language used by the parties, nor even to the terms of the bargain, but only to a resulting fact or, rather, legal conclusion.

For these reasons I am of opinion that the judgment should be reversed, with costs, and a new trial granted.