This section is from the book "Popular Law Library Vol8 Partnership, Private Corporations, Public Corporations", by Albert H. Putney. Also available from Amazon: Popular Law-Dictionary.
In Conlan vs. Mead,32 the Court said: "It is next claimed that appellees' instruction No. 5 is erroneous in informing the jury that they are 'at liberty to consider the statements and representations of W. I. Watson, as bearing upon said partnership, which were made by him, provided the jury first find, from the evidence, that the said James Conlan, by his own words or conduct, held himself out as a partner of said firm, and that the plaintiffs had notice thereof and acted thereon.' We do not regard the instruction as entirely free from criticism, but we think the principle announced is substantially correct. Where an action is pending against two as partners, and one of the defendants put the fact of partnership in issue by proper plea, the admissions or statements of his co-defendant, made in his absence, in reference to the existence of the partnership, are not, in the absence of other evidence tending to establish a partnership, admissible upon the issue.33 But where sufficient evidence has been given to raise a fair presumption that two or more persons are partners, then the acts and declarations of each are admissible as evidence against the others, for the purpose of strengthening the prima facie case already established.34 If Conlan, by his declarations or acts, held himself out as a partner of the firm, as declared in the instruction, a prima facie case was established, and then the declarations of Watson, the other partner, were admissible."
29 Latta vs. Kilbourn, 150 U. S., 524; McMalian vs. McClernan,
10 W. Va., 419. 30 Bates vs. Lane, 62 Mich., 132;
Meserve vs. Anderson, 106
31 McGahan vs. National Bank, 156 U. S., 218; Burkhardt vs. Yates, 161 Mass., 591; Rumsey vs. Briggs, 139 N. Y., 323; Rock vs. Collins, 99 Wis., 630.
32 172 III., 17.
And if the partnership is admitted, of course, the declarations and statements of one partner in regard to firm transactions are admissible.
In Rosenkrans vs. Barker,35 the court said: "In many respects one partner is the agent of the other. In the purchase and sale of goods within the scope of the partnership business, the acts of one may be regarded as the acts of both. In such cases the one that transacts the business, acts for himself and in the capacity as agent of the other, and in that capacity he binds himself and also binds his partner. By entering into partnership, each party reposes confidence in the other, and constitutes him his general agent as to all partnership concerns.36 But the question involved here is not as to the liability of one partner for the contracts of the other, but is whether one partner may be liable in damages for the wrongs of the other. Mr. Collyer, in his work on Partnership, section 457, says: 'A learned writer observes, that though partners are, in general, bound by the contracts, they are not answerable for the wrongs of each other. In general, acts or omissions in the course of the partnership trade or business, in violation of law, will only implicate those who are guilty of them.' And in 1 Lindley on Partnership, bk. 2, chap. 1, sec. 4, the author says: 'As a rule, however, the wilful tort of one partner is not imputable to the firm. For example, if one partner maliciously prosecutes a person for stealing partnership property, the firm is not answerable unless all the members are, in fact, privy to the malicious prosecution.' In Gilbert vs. Emmons,37 where a question arose as the liability of one partner for the act of the other in causing the arrest of a person charged with the larceny of money belonging to the firm, it was held that the mere knowledge and consent of one partner that the other should have the person accused arrested, would not render the partner so knowing and consenting, liable to an action for malicious prosecution. It was necessary that the consent should be of such character as to amount to advice and cooperation. In Grund vs. Van Vleck,38 a question arose as to the liability of one partner for the tort of the other, and it was held that one partner cannot involve another in a trespass unless in the ordinary course of their business, and in a case where the trespass is in the nature of a taking which is available to the partnership; and in such a case, to render the partner liable who did not join in the commission of the trespass, he must afterwards have concurred, and received the benefit of it. Here no part of the debt was collected by the commencement or prosecution of the proceedings against Barker, and it is not claimed that a liability exists on account of receiving any benefit from the arrest, and if Rosen-krans is to be held liable, it is upon the ground that he was a member of the firm which instituted the suit and caused the arrest. This, under the authorities cited, cannot be done."
33 Hahn vs. St. Glair Savings & Ins.
Co., 50 III., 456. 34 Lindley on Partnership, 86, 87;
1 Greenleaf on Evidence, sec.
177. 35 115 III., 337. 36 Gow on Partnership, 62.
37 42 III, 143.
38 69 III., 478.
The facts were in this case that when Rosenkrans learned what had been done he notified his partner that it was wrong, and advised the dismissal of the case, and under his advice no further steps were taken to prosecute it. Nor was the prosecution a regular and ordinary proceeding for the collection of a debt, though this was the motive in the prosecution. But there were other motives and the decision might rest on the ground that the act of prosecution under the facts in the case was outside the scope of the partnership business and indicated private malice or ill-will. The case is so understood by Mechem.39 It is well established that the firm is liable in a civil action for the negligence of one partner, committed in the transaction of partnership business; and this liability extends to trespass, fraud, deceit, misrepresentation, or malice, if committed in the scope of the partnership business and in furtherance of its interests. Otherwise the doctrine of the liability of the princpial, for the torts of his agent would not apply.40 It will be noticed that in the authorities cited in the opinion of the court just quoted, the references are to willful torts and violations of positive law.