COOPER v. WOOD

27 P. 884

1 Colo.App. 101

COOPER
v.
WOOD et al.

Court of Appeals of Colorado

October 12, 1891

Error
to Lake county court; WILLIAM R. HALL., Judge.

H.D.
Wood and others sued Isaac Cooper and C.H. Tibbetts as
partners for a firm debt. Pending the suit, Cooper died, and
his wife, Sarah F. Cooper, as administratrix, was
substituted. Judgment for plaintiffs. Sarah N. Cooper
appeals. Reversed.

J.E.
Havens and Bennett & Bennett, for plaintiff in error.

C.S.
Libby, for defendants in error.

REED,
J.

If this
were not a case affecting the estate of a deceased person,
requiring a speedy termination, to enable a settlement of the
estate at as early a date as practicable, we should be
obliged to dismiss the suit, under the rules of the court,
for want of a proper abstract. What purports to be an
abstract contains nothing but a copy of the pleadings, and
what counsel call a summary of the assignment of errors.
Nearly every supposed error arose upon the admission and
rejection of evidence, yet the abstract contains no evidence
whatever upon the admission and rejection of which errors are
assigned, and no reference to the folios or pages of the
record [1 Colo.App. 102] where it can be found; but, under
the circumstances of this particular case, the rule will be
waived, hoping such irregularities will not again occur. The
suit was brought by defendants in error (partners) against
Isaac Cooper and C.H. Tibbetts, as partners, to recover the
balance due upon goods alleged to have been sold to the
defendants. Service was had upon Isaac Cooper, but none upon
Tibbetts. The complaint is in the ordinary form, alleging a
balance of $558 and interest to be due, and asking judgment.
The answer of the defendant Cooper, after denying every
allegation of the complaint generally, specifically denies
the existence of the partnership of the defendants, and avers
that in June, 1880, and before the debt sued for was
contracted, he, the defendant, notified the plaintiffs that
no partnership existed, and forbade any sale of goods to
Tibbetts on his responsibility. It is also further averred in
the answer that plaintiffs afterwards settled
[27 P. 885]
with Tibbetts individually for the amount due, including the
claim in this suit, and took the individual note of Tibbetts
and a trust-deed upon real estate to secure the payment of
the note; that the plaintiffs accepted and received the same
in satisfaction of the original indebtedness of Tibbetts. In
reply, plaintiffs reassert the partnership of defendants,
admit the settlement made with Tibbetts, and the taking of
his note and the deed of trust as security, but aver it to
have been as collateral security only, and allege the
nonpayment of the note, and a failure to realize anything
upon the security. Previous to the trial, defendant Cooper
died, and plaintiff in error, as administratrix, was
substituted. It also appears from the record that during the
trial counsel of defendants moved the court for leave to
amend the answer by alleging that the individual note of
Tibbetts was further secured by a chattel mortgage upon
personal property, and leave to amend was denied by the
court. Trial was had to the court without a jury,
resulting--as near as it can be understood--in a judgment
against the supposed firm of Cooper & Tibbetts [1 Colo.App.
103] for the sum of $1,008.50, and judgment for like amount
against the estate of Cooper, deceased. The existence of the
partnership between the defendants having been directly and
specifically put in issue, plaintiffs, in order to recover
against the estate of Cooper, were obliged to establish it
affirmatively. An attempt was made to establish it by
secondary evidence, such as general reputation,
circumstances, etc., but this class of loose, indefinite
testimony of circumstances, common report and reputation
"is not admissible, except in corroboration of previous
testimony, unless it be to prove the fact that the
partnership otherwise shown to exist was known to the
plaintiff." 2 Greenl.Ev. § 483. Numerous other
authorities might be cited, but the proposition is so
elementary and well understood it is unnecessary.

Tibbetts,
the supposed partner, was put upon the stand as a witness for
the plaintiffs, and testified: "I lived in Bowman,
Gunnison county, Colorado, in 1880 and 1881, and was engaged
in merchandising. Had a partner in the business,--Isaac
Cooper, now deceased." This was the only direct
testimony to establish the partnership which was found by the
court. This was error. The supposed partner was not competent
as a witness to establish the partnership. Section 4816, c.
132, Mills' Ann.St., is as follows: "That no party
to any civil action, suit, or proceeding, or person directly
interested in the event thereof, shall be allowed to testify
therein, of his own motion, or in his own behalf, by virtue
of the foregoing section, when any adverse party sues or
defends as the trustee or conservator of an idiot, lunatic,
or distracted person, or as the executor or administrator,
heir, legatee, or devisee of any deceased person, or as
guardian or trustee of any such heir, legatee, or devisee,
unless when called as a witness by such adverse party so
suing or defending." This is a copy of the statute of
the state of Illinois. I can find no case in our own Reports
where the exact question has been determined, but it has been
adjudicated and construed in that state, and directly held
that [1 Colo.App. 104] a surviving partner was incompetent,
by reason of his interest. See Langley v. Dodsworth, 81 Ill.
86; Hurlbut v. Meeker's Ex'x, 104 Ill. 541. The
latter case is directly in point. It is said in the opinion,
after quoting the statute: "Under this statute we are
satisfied that neither J.D. Hurlbut nor D.N. Hurlbut was a
competent witness for the plaintiff. They were not made
defendants in the action, but were directly interested in the
event of the suit. They were members of the firm of Hurlbut
Bros. & Co. at the time the note was executed, and were
makers of the note in suit, and hence had a direct interest
in the result of the pending action." In the course of
the examination of the witness Tibbetts the following
occurred: "Question. State whether or not, of your own
knowledge, the account sued upon in this action has been
paid. Answer. Well, in my judgment, it has been paid. I gave
the plaintiffs a promissory note, and also a chattel
mortgage, to satisfy that account. It was my individual note.
Have never received the note in return. Plaintiffs received
payment of that note. They did not receive any money. I do
say the plaintiffs realized the goods in the house which I
gave them, in a chattel mortgage upon the goods in the
Tibbetts House, to pay this account." At this stage of
the proceedings leave was asked to amend the answer as above
stated, and denied. The refusal to allow the amendment was an
abuse of the discretion of the court, and may have worked
great injustice to the defendant. Either the pleadings should
have been allowed to have been amended, or, in proof of
payment, all the transactions between Tibbetts and
plaintiffs, and all facts of dealings in the way of payment
or satisfaction, should have been elicited. This becomes more
apparent in the subsequent testimony of Tibbetts, when called
by defendant, and in the refusal of the court to allow the
witness to testify to certain facts offered in proof, which,
if established, would of necessity have shown, if not full,
at least partial, payment by the witness. He stated that in
payment of his individual note at its maturity [1 Colo.App.
105] he turned over to plaintiffs the personal property
covered by the chattel mortgage; that plaintiffs took
possession and charge of it; no portion was ever returned to
him; and that it was used by plaintiffs in the Tibbetts
House, at Aspen. He was then asked the value of the property.
Objection was made and sustained. Defendants also attempted
to prove by the witness that the witness was misled by one of
the plaintiffs at the time the real property was sold under
the trust-deed; that plaintiff informed him that he would
protect his interests, and that it was unnecessary for him to
attend the sale; that he remained away, and the property was
bid in for a nominal sum, far below its value, etc.; but was
not allowed to make the proof. How far the defendant might
have been successful in establishing the facts contained in
his offers of proof of
[27 P. 886.]
course cannot be known, but the opportunity should have been
allowed him. It is unnecessary to follow this subject
further. The whole matter should have been investigated.

In
defending suits of this character estates are at great
disadvantage, and, to a great extent, at the mercy of
claimants. The actor in the transactions, who did the
business, and knew all the facts and details, being dead, the
representative of the estate, having no knowledge only that
subsequently gained, cannot, in the first instance, in all
cases interpose all necessary defense, and courts should, in
the interest of justice, and for the protection of widows and
children, afford every reasonable facility for the full
investigation of every asserted claim. Such facilities were
not given, nor such protection, to the estate upon the trial
of this cause.

Another
important question, which, as far as I can ascertain, has not
been determined in this court, is presented in this case,
viz., whether, under any circumstances, after the dissolution
of the partnership, the admissions or acknowledgments of a
former partner are admissible to establish a cause of action
against a former partner. In England, the rule for years was
well settled that such admissions are competent, not only to
take the case out of the statute of limitations, [1 Colo.App.
106] but to establish or create a firm indebtedness. It was
based upon the opinion of Lord MANSFIELD in Whitcomb v.
Whiting, 2 Doug. 652, and what Judge Story (Story, Partn. §
323) did not hesitate to call "an unreasoned
decision." The case has been severely criticised in the
English courts. See opinion of Lord KENYON in Clarke v.
Bradshaw, 3 Esp. 155; of Lord ELLENBOROUGH in Brandram v.
Wharton, 1 Barn. & Ald. 463; and Lord TENTERDEN in Atkins v.
Tredgold, 2 Barn. & C. 23; and the doctrine has been limited
and partially overturned by late acts of parliament. In the
United States, considerable diversity of opinion is expressed
in the different courts, some few states adhering to and
following the old English decisions; but in federal courts
the English doctrine has been overruled, and the admissions
held inadmissible, first in the case of Clementson v.
Williams, 8 Cranch, 72, followed by Judge STORY in Bell v.
Morrison, 1 Pet. 373. In Bispham v. Patterson, 2 McLean, 87,
the learned judge, after reviewing the authorities, expressed
his conviction in favor of the English rule, but yielded to
American precedents, and decided the case in harmony with
them. The American rule, overruling early English decisions,
has since been followed in those courts. See Thompson v.
Bowman, 6 Wall. 316. In a great majority of state courts the
English doctrine has been overruled; first, in the state of
New York, and followed by at least 20 other state courts. In
New York the English rule was repudiated as early as Walden
v. Sherburne, 15 Johns. 409, which has been since followed in
Van Keuren v. Parmelee, 2 N.Y. 523, in which the decisions of
the different states are carefully and ably reviewed in the
court of appeals, resulting again in overruling the English
doctrine. The principal authorities on the subject will be
found collected in 3 Kent, Comm. 49-51. The power of an
individual partner to bind the firm during its existence
arises only from the fact that each is the agent of the firm,
and "it seems difficult upon principle to perceive how
they can be any more than the declarations or [1 Colo.App.
107] acts or acknowledgments of any other agent of the
partnership would be after his agency has ceased."
Story, Partn. § 323; and see Ellicott v. Nichols, 7 Gill, 85;
Thompson v. Bowman, 6 Wall. 316. There is certainly great
authority, as well as reason, for adopting the American rule.
In this case, not only was the partnership dissolved, but the
party to be charged was dead; "but, however the doctrine
may be after a dissolution in cases where all the partners
are living, it is very clear that no acknowledgment by the
surviving partners after the death of one of them will revive
the debt against the estate of the deceased partner,"
(Story, Partn. § 324a;) and this seems also to be the English
as well as American rule. See Atkins v. Tredgold, 2 Barn. &
C. 23; Slater v. Lawson, 1 Barn. & Adol. 396; Crallan v.
Oulton, 3 Beav. 1; Way v. Bassett, 5 Hare, 67. In this case,
not only was the party whose estate is sought to be charged
dead, but the claim in suit, prior to his death, had been
assumed as the individual debt of Tibbetts and his individual
note and security taken in supposed extinguishment of any
partnership liability; yet the witness was allowed to testify
not only that the debt was originally a firm debt, but that
it remained so notwithstanding the fact that previous to the
death of Cooper it had apparently been regarded by all
concerned as the debt of Tibbetts alone. Certainly, if in any
case a rule of law will close the mouth of a surviving
partner, it should be applied in this, where not only the
direct interest of the witness, but the rule of law, relieves
the estate from the effects of such directly interested
testimony. We have no hesitancy in saying that the admissions
and statements of Tibbetts, calculated to charge the estate,
were incompetent, and should have been excluded. The judgment
should be reversed, and the cause remanded for a new trial.