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Holdane et al. v. Butterworth.

Therefore, as the finding may have been that he was actually known, and through direct transactions, to be a member of the firm, the decision may justly be placed upon that ground. It is not a necessary consequence that if the source of information had been nothing but repute, actual notice of retirement would have been equally essential.

In Farrar v. Defflinne, (1 Carr. and Kir., 580,) the defendant and one Todd had been in partnership from 1834 to 1837. The defendant was a dormant partner; but much testimony was given to show that the plaintiff had been aware of his being a partner, and had not been made acquainted with the fact of his retirement. That had taken place before the claims sued upon arose. CRESSWELL, J., put it to the jury thus: The question for you is, was this partnership actually known to the plaintiff either by general report or by direct communication? If it was, and he did not know, either from notice of the fact or from surmise, that the dissolution had taken place, you may infer that he still dealt on the faith of the partnership, and the defendant will therefore be liable. The plaintiff had dealt with the firm during the partnership, and afterwards. I think that the phrase "surmise" used by the learned judge may be treated as equivalent to "repute."

Lord KENYON in Godfrey v. Turnbull, (1 Esp., 371,) where notice had been given in the Gazette, and the case was of a plaintiff who had not previously dealt with the firm, and the defendant had retired before the bill sued on was given, said: “If the dissolution be notified in the ordinary way, in the only way in which the fact of dissolution can be promulgated, (at least to those who have had no previous dealings with the partners,) it seems sufficient at least to be left to the jury from thence to infer notice."

In the Tombeckbee Bank v. Dumell & Lyman, (5 Mason, 56,) it was held that a bill accepted after a dissolution, though drawn before, did not bind a retiring partner, who had announced the dissolution by a public advertisement at the place of business.

Dobbin v. Foster, (1 Carr. and Kir., 323,) was a case in which the retiring partner was originally bound to the plaintiff. Although his retirement was known, there was not enough to show a relinquishment of that original liability.

There is a marked line of distinction between cases of a previous dealing with a firm of which the party to be charged was

Holdane et al. v. Butterworth.

known to be a partner, or of which dealing he received, or might have received a benefit in profits, and cases of a dealing for the first time after the party had retired, and the credit was ostensibly given only to the parties forming the new firm.

When a plaintiff rests only on the common notoriety of a person having been a partner, to make him liable for a contract made after his retirement, an equally common notoriety of retirement or dissolution must be sufficient to exonerate him. If without actual personal knowledge or actual dealing, the ground of notoriety can be presumptively sufficient to fix a responsibility upon a party, the same ground of general repute should operate in his favor, which operates against him. This is the case before us upon the verdict of the jury.

There remains one question. What is the effect of the evidence of one of the plaintiffs, that he supposed Butterworth continued a partner, when the sale of the iron was made?

It is apparent that the danger of receiving such evidence is great, especially since the admission of parties to testify on their own behalf. The defendant in such a case must be defenseless, unless he can prove actual notice of the dissolution brought home to the plaintiff.

The plaintiff, James H. Holdane, has not sworn that he made the bargain in this case, nor is there one word of corroborative evidence tending to show any reliance upon Butterworth's credit.

The judgment should be affirmed, with costs.

BOSWORTH, Ch. J. The proposition is not controverted; that after the dissolution of a firm properly notified, no new contract by the continuing firm can bind the partner who retires.

A notice of dissolution published in the Gazette before a new contract is made, has been held to be an answer to an action by a person having no previous dealings with the firm, whether he saw such notice or not. (Collyer on Part., p. 311, § III., Perkins' 3d ed., § 534.)

"Public notice, in some reasonable and sufficient manner, must be given, and that will conclude all persons who have had no previous dealings with the firm." (Ketcham & Black v. Clark, 6 J. R., 148.)

Holdane et al. v. Butterworth.

The jury found it was "a matter of public notoriety that the firm was changed on and after" the 1st of March, 1855. The plaintiffs' proposition to sell the iron in question was made by a letter dated the 8th of October, 1855. On the 10th they took for the iron a note made by "C. H. Tupper & Lee," the new firm. The firm of which Butterworth was a member, never did business in that name. When the new firm was formed an old tin sign on the front office was taken down and changed, and a new sign put up with the names "C. H. Tupper & Lee," thereon. Printed circulars stating the dissolution of the old firm and the formation of the new one, and who composed the latter, were sent by post to all who had dealt with the old firm. Butterworth did not appear in the business, nor had he anything to do with it, after the dissolution of the old firm.

Under such circumstances, the fact that the dissolution of the old firm was a matter of public notoriety, should protect an out going partner, as against a person who never dealt with the old firm, and who, after the lapse of more than six months after the dissolution, sells goods to the new firm, and takes its note therefor, signed in the new firm's name, although he transacted the business with one who had been a member of the old firm.

Public notoriety of the fact of dissolution is sufficient notice to all persons who never dealt with the old firm.

It is an extravagant claim, when made by persons, dealing with the new firm after the lapse of months from the time of its formation, and taking the note of the new firm, that the sale was made on the credit of the retiring partner, and on the faith that he was a member of the firm, especially when it is not pretended that he ever did business in that name, but on the contrary it is proved that the name of his firm was entirely different. I think the facts proved entitled the defendant to a verdict and that the judgment should be affirmed.

Judgment affirmed.'

1 Since the above cause was decided, the City Bank of Brooklyn v. Mc Chesney et al., (20 N. Y., 240,) has been decided by the Court of Appeals. The latter case seems to hold that publication of a dissolution of a partnership in a newspaper, is requisite to protect the retiring partner from liability to one subsequently and in good faith taking a note made in the firm's name after such dissolution; although the person so taking it had not been a dealer with the firm, but had knowledge of its prior existence and not of its dissolution.

The reason why notice of the dissolution of a partnership published in "the Gazette in England," has been held a sufficient notice to those who have not dealt with the firm, whether

Ogden v. Raymond et al.

SAMUEL G. OGDEN, Jr., Plaintiff and Respondent, v. WILLIAM M. RAYMOND and WILLIAM H. FORBES, Defendants and Appellants.

1. Where, in an action by the indorsee of a note against the makers, the complaint alleges the making by the defendants of a note payable, by its terms, to the International Insurance Company, or order, that such Company afterwards and before its maturity "duly indorsed the said promissory note, and the same was, thereupon, duly transferred and delivered to the plaintiff;" and where the answer merely avers that said Company never had "any legal existence as a corporation," and denies that "it had any legal power or capacity to transfer said note to the plaintiff by its indorsement or otherwise;" the making of the note by the defendants, and its actual and due indorsement and transfer by the Company, are admitted if proof be given of the incorporation of such Company under a charter authorizing it to transfer by indorsement promissory notes which it may own. 2. Under such pleadings the defendants cannot show that the note, with others, amounting in all to over $1,000, was transferred without a previous resolution of the Board of Directors of the Company authorizing such


actually seen or not, as stated by Lord ABINGER, C. B., in Hart v. Alexander, (7 Carr. & P., 746,) is that "the Gazette in England is the usual evidence of a dissolution of partnership, even against persons who are not proved to have read the Gazette at all, because a person, not knowing who may trust a firm hereafter, announces his leaving it by an advertisement in the Gazette."

It is not intimated that publication of such a notice in any other newspaper, would be equally a protection to the retiring partner.

There is no particular newspaper in the city of New York, in which notices of dissolutions of partnerships are exclusively published, or in which it is expected they may be found. So that publication in a newspaper not taken by a person seeking to charge the retiring partner would not be likely to inform him of the withdrawal of such person from the firm.

If publication in a newspaper, though the publication be not seen and cannnot ordinarily be expected to be seen, is to protect a retiring partner, it must protect him on the ground, that such a notice is all that can be reasonably required, by persons who had not dealt with the firm during its existence.

If public notoriety of the dissolution of a partnership and of the formation of a new firm with a new partnership name, will not protect the retiring partner from liability to a person who had no previous dealings with the firm and who subsequently sells goods to the new firm and takes the note of the new firm therefor; then the only ground of exemption would seem to be (no notice of the dissolution having been published in any newspaper) that such person had actual notice of the retirement of the withdrawing partner; and the question of actual notice would seem to be one of fact, to be shown by direct evidence, or by circumstances that would justify a jury in inferring it. (Hart v. Alexander, 7 Carr. & P.; 746; Ketcham & Black v. Clark, 6 J. R., 146.) "A general notice, by advertisement or otherwise, should be sufficient for those who know the firm only by general reputation." (VERPLANCK, Senator. 22 Wend., 194.)

However, much doubt may be created as to the accuracy of the decision in Holdane v. Butterworth, by the case in 20 N. Y. R., 240; the questions involved are deemed of suffi cient importance to justify the reporting of it. REP.

Ogden v. Raymond et al.

3. Nor can they under such pleadings show that some of the original subscribers, whose subscription notes were taken as the capital stock on its commencing business, were irresponsible and minors.

4. Nor can they show under such pleadings that the corporation was dissolved and a receiver of its effects appointed, by due judicial proceedings, subsequent to the transfer by the Company of the note thus sued upon. 5. Where, in such an action, and upon such pleadings, the pleadings alleging no other defense except that the note was an accommodation note and was known to the plaintiff to be such when he took it, and that it has been paid from other collaterals transferred with it as security for a loan made to the Company, and where it has been proved that a loan of $15,000 was made on the security of $19,000 of collaterals including the note in suit, and that only $12,000 of the loan has been repaid; it is not error to reject evidence of the whole number of collaterals; or that judgments have been obtained upon some of the collaterals, or of what securities were at any time received for the loan, or were held at the time of the trial.

(Before BosWORTH, Ch. J., and HOFFMAN and MONCRIEF, J. J.)
Heard, April 12th; decided, May 21st, 1859.

THIS is an appeal by the defendants, (William H. Raymond and William H. Forbes,) from a judgment against them in favor of the plaintiff, rendered on a trial had before Mr. Justice SLOSSON without a jury, on the 13th of May, 1858.

The action is against the defendants as makers of a note, which, with its indorsement, reads thus, viz.:


NEW YORK, October 4, 1855. "Twelve months after date, we promise to pay the International Insurance Company, or order, for value received, seven hundred and fifty dollars payable at the People's Bank.




"For the International Insurance Company.-M. Starbuck, President."

The complaint alleges the defendants to be partners, under the firm name of Raymond & Co., and that as such, they made and delivered the note to said Company; that the Company afterwards duly indorsed said note before its maturity, and the same was thereupon duly transferred and delivered to the plaintiff; that the note is past due, and no part of it has been paid, and prays judgment for the amount of it with interest.

Bosw.-VOL. V.


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