George W. Martin and others vs. Walter Searles and another

*George W. Martin and others vs. Walter [ *43 ] Searles and another. Where a partnership is dissolved by the voluntary act of the partners, and not by operation of law, reasonable notice, (as a general rule, by publication in a newspaper of the vicinity,) must be given to the public, and until it is actually so given the partners remain liable as such to any person, although not a former dealer with the firm, who may thereafter enter into a contract, within the scope of the partnership business, with either of the partners in the name and upon the credit of the partnership, without actual knowledge of the dissolution. And it makes no difference that there has not been time to give such notice or that for any reason it was not practicable to give it. And it is not enough that the fact of the dissolution has become notorious, if the notice required by law has not been given and the party giving credit to the partnership has no actual knowledge of the dissolution. Action of book debt, to recover for certain beef cattle sold to the defendants, Walter Searles and Charles M. Valentine, as partners. The defendant Valentine suffered a default, and Searles assumed the defense and claimed that the cattle were purchased by Valentine after the dissolution of a previously existing partnership between Valentine and himself, and that he was not liable. The case was referred to an auditor, who reported that the defendants were indebted to the plaintiffs in the sum of $568.04; against the acceptance of which report the defendant Searles remonstrated, and on the remonstrance the following facts were found by the court. Searles and Valentine,' previous to the 15th day of July, 1856, had been partners in the butchering business in Stamford', in this state, and on that day agreed to dissolve the partnership. Immediately after, on the same day, Searles wont to the office of the Stamford Advocate, a weekly paper published in said Stamford, and left for publication a notice of the dissolution, but the paper for that week having been set in type, and that being its day of publication, the notice was not published until the following week, on the 22d day of July ; and no other paper was then published in Stamford. Valentine, on the [ *44 ] 16th day of July, in the morning and before *the purchase of the cattle, told the workmen in the shop in which the partnership had transacted its business, of the dissolution, and asked one or two of them tó remain in his employment; and Searles, on the 15th day of July, in a consultation with Win. T. Minor, Esq., of Stamford, an attorney at law, in relation to the dissolution, informed him of the fact. Before the partnership was formed Valentine had lived in the city of New York, engaged in butchering business, during which time one of the plaintiffs W'as well acquainted with him, and had done business with him on credit. The plaintiffs, long before the sale, knew of the existence of the partnership of the defendants, and had been informed and believed that Searles was a man of abundant pecuniary responsibility; but they had never before had any dealings with the defendants. No other notice of the dissolution had been given when the sale was made and no other effort to give such notice had been made by Searles or any one else. The cattle were purchased of the plaintiffs by Valentine in the name of the firm, on the 16th day of July, in the city of New York; the plaintiffs having received no notice of the dissolution, and selling the cattle entirely on. the faith of the partnership, which they believed to still exist, and in reliance chiefly on the pecuniary responsibility of Searles. Upon these facts the court overruled the remonstrances accepted the report, and rendered judgment for the plaintiffs. The defendants thereupon filed a motion in error, and brought the record before this court. Ferris and Minor, for the plaintiffs in error. There is but one question in the case, viz: was the notice of the dissolution of the partnership sufficient. It was sufficient, unless it'be held that, under all circumstances, the dissolution of a partnership must be published in some newspaper in order to relieve a retiring partner from liability to every person thereafter trusting the firm, even though such person may have hacl no previous dealing with the firm. The case shows that the plaintiffs had never had any dealings with the *de- [ *45 ] fendants previously to the dissolution of the partnership. We insist that in this case the notice of dissolution was much better calculated to advise the plaintiffs of that fact, than the publication of the notice in any newspaper in which it could have been published. It is enough if the notice is reasonable. Mowatt v. Howland, 4 Day, 358, 6. And where the facts are found, it is for the court, to say whether the notice was reasonable. Bristol v. Sprague, 8 Wend., 424. Again, Searles, the retiring partner, did every thing that could reasonably be required of him to give notice. The plaintiffs did nothing whatever to ascertain the existence of the partnership, but gave the credit entirely upon the representations of Valentine, the continuing partner, with whom they had been previously acquainted, and to whom they had previously sold goods on credit. They ought not then to hold Searles liable. 1 Parsons on Cont., 144, 5. Hawley, for the defendants in error. Though the plaintiffs had not been previous dealers with the defendants, yet, as they had known of the existence of the firm, had no knowledge of its dissolution, still believed it to be existing, and sold their cattle in that belief and on the credit of the firm, no public notice of the dissolution having been given, they are entitled to recover. This results from the very nature of a partnership, and of the power which each partner gives the other. The consequences of any abuse of that power must be borne by those who have conferred the power. Parkin v. Carruthers, 3 Esp., 248, 9. Godfrey v. Turnbull, 1 Esp., 371. Ketcham v. Clark, 6 Johns., 144, 148. Gorham v. Thompson, Peake, 42. 1 Sw. Dig., 349, 350. Carter v. Whalley, 1 Barn. & Ad., 11. Goddard v. Pratt, 16 Pick., 412, 431, 2, 4. Paley on Agency, chap. 3, pt.-1, sec. 2. Davis v. Allen, 3 Comst., 168. The law is the same though there has not been sufficient time before the sale to give public notice. Bristol v. Sprague, 8 Wend., 423. The contract having been made in New York, must be governed by the laws of that state if they were variant from our own. But our law is the same as that of New York. There had *been time to pub- £ *46 ] lish in a daily paper in New York. There was no notoriety of the dissolution. If there had been it would not have helped the defendants. Pitcher v. Barrows, 17 Pick., 361, 5. Gorham v. Thompson, supra. [MAJORITY — Butler, J.] Butler, J. In the case of Lyon v. Johnson, decided this term, we have examined at some length the duty required of a retiring partner in regard to notice of the dissolution, and shall here content ourselves with an application of the rules there stated to the facts of this case. It appears that the contract upon which the plaintiffs claimed to recover, was entered into by them on the faith of the partnership, with one of the partners, in the name and ostensibly for the benefit of the partnership, and was within the scope of the partnership business; and it is therefore obligatory on all the partners, unless the dissolution resulted by operation of law, or notice, actual or constructive, had been in fact given to, or had by the plaintiffs. It is found that the dissolution was voluntary, and not by operation of law, and that the partnership was a general and public one. Notice was therefore necessary. It is also found that the plaintiffs had never had any previous dealings with the firm. Actual notice therefore was not necessary as to them, and notice by publication would have been sufficient. It is further found that there was a newspaper published in Stamford, the place where the partnership business was conducted, and that the defendant Searles intended and attempted to procure the insertion of a notice in it, but was not in time for the issue of that week, and that therefore no notice by publication had been given to the plaintiffs or the public at the time the contract was made. , • ;■ The obligation rested on Searles to inform the public that the contract was dissolved, and until he performed that duty, and in the mode deemed reasonable, his responsibility continued. Such is the perfectly well settled rule of law, founded on the plainest principles of policy and justice. It is of no conse- [ *47 ] quence that he had not had time to do it. *Bristol v. Sprague, 8 Wend., 423. Performance was essential to a discharge of his liability. That he was not able to give the notice was his misfortune, and he must abide it; he can not visit it upon the plaintiffs. It is further found that the dissolution had become a matter of some notoriety in Stamford. This can not avail the defendant. Pitcher v. Barrows, 17 Pick., 361. That which is generally known may not be universally so, and however notorious the dissolution may have become, unless he could show that by reason of it the plaintiffs had become acquainted with the fact, and therefore had actual ’knowledge, his liability continued. That the plaintiffs had such knowledge does not appear. On the contrary, it is found that the plaintiffs had no notice or knowledge of the dissolution ; and they were clearly entitled to recover. There is no error in the judgment complained of. In this opinion the other judges concurred. Judgment affirmed.