Abbot v. Johnson

32 N.H. 9
CourtSupreme Court of New Hampshire
DecidedDecember 15, 1855
StatusPublished
Cited by2 cases

This text of 32 N.H. 9 (Abbot v. Johnson) is published on Counsel Stack Legal Research, covering Supreme Court of New Hampshire primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Abbot v. Johnson, 32 N.H. 9 (N.H. 1855).

Opinion

Perley, C. J.

It has been decided on the demurrer that the complainants, in their bill, state a case which entitles them to relief. The answers very fully admit the general arrangement alleged to have been made between the defendants and Atkins & Stedman, by which the plaintiffs were sued in the action at law, and charged as partners in the firm of the Farmers’ and Mechanics’ Company, and that the execution, which was issued on the judgment recovered in that suit, was levied on their property, and in part paid by them. They also admit that the original contract of partnership, signed by the plaintiffs, was produced by Atkins and Stedman as the agreement under which [18]*18the business of the company was transacted, and that the original agreement had been altered in the manner stated in the bill, before the business of the company was commenced.

Two principal questions remain to be settled: 1. Were the complainants partners with the defendants in the Farmers’ and Mechanics’ Company ? 2. Are they properly joined as plaintiffs in this suit ?

The case in the action at law of Atkins $ a. v. Sunt a., reported 14 N. H. Rep. 206, has been cited as an authority to shew that the complainants are to be regarded in this suit as partners with the defendants in the firm of the Farmers’ and Mechanics’ Company ; but the point of the complaint in this bill is, that by collusion and contrivance between the defendants and the plaintiffs in that suit, the real facts of that case were suppressed, and a judgment thereby procured contrary to equity, and the object of this bill is to obtain relief against the consequences of that judgment. On that case as reported it appeared that these plaintiffs signed the agreement under which the business of the firm was transacted, paid in their subscriptions to the capital stock, and were entitled to share in the profits. No mention is there made of any change in the original articles of partnership, of any objection made by the plaintiffs, or of the fact that when called on they declined to pay in their subscriptions. The learned Chief Justice, in delivering the opinion of the court, says : There was an association doing business under a certain name ; the defendants signed the articles which .constitute this association; the defendants were subscribers, and a by-law provided that each subscriber should become a partner ; the business of the company was done in pursuance of a major vote of those present, and an agent was appointed, who purchased goods for the use of the company. Here, then, there was not simply an agreement that a partnership should be formed at some future day, but an actual, existing reality, a subscription to articles, making a, present association, and a by-law designating the subscribers as partners. A right to participate in the profits of a joint concern is one of the tests of partnership, where a [19]*19party has fulfilled all the conditions incumbent on him to perform.” It is quite obvious that none of the material facts, on which the plaintiffs rely in this suit, appeared in that case.

Taking the articles of agreement signed by the plaintiffs and defendants to have constituted an actual partnership, and not to have been a mere agreement for a future partnership, the contract was mutual among all the subscribers, and they were mutually bound to abide by the terms of their agreement. If the subscribers, or the majority, and managers, violated the articles of partnership in any substantial point, those who dissented might rescind the agreement, so far as they were concerned, and withdrew from the association, provided they did it within a reasonable time, and under reasonable circumstances. The original articles signed by the plaintiffs stipulated that there should be no dealing in ardent spirits. The company changed the article which contained this stipulation, and substituted another, under which the business of the company was actually conducted, and by virtue of which they dealt in spirituous liquors.

It was expressly provided in the written contract signed by the plaintiffs, that the partnership should not deal in ardent spirits ; the company altered the contract so as to allow a trade in ardent spirits to be carried on ; and we can have no hesitation in holding that this was such a substantial alteration as discharged the plaintiffs from their obligation to proceed with the partnership, unless they agreed to the change, and that it gave them the right to retire from the firm. Inasmuch as the partners thought fit to make this stipulation a part of their fundamental agreement, we should hardly think ourselves at liberty to enter on an inquiry whether the stipulation was in its character a material part of the contract. It is evident that the partners have chosen to regard it as an essential provision in their association ; otherwise they could not have made it the subject of a separate article in their written agreement. But if it had been left to the judgment of the court, we should feel bound to hold that the article in question was a material and substantial part [20]*20of the contract. The partnership was formed by a large number of neighbors, who must be supposed to feel a lively interest in the morals of the community to which they belonged. It is well known that many men entertain strong opinions on this subject of dealing in ardent spirits, and hold the traffic to be immoral. Unléss there were a license, the trade would be unlawful. If the question were considered merely in a pecuniary point of view, an honest difference of opinion might well exist as to the policy of engaging in this trade. At any rate, a retail trade in a country village, connected with the sale of spirituous liquors, must be regarded as differing in a material and substantial point from a trade without it.

We must hold, therefore, that the plaintiffs were not bound by the altered articles of partnership, unless they assented to the change ; that they had a right to withdraw, if they did it under circumstances which were such as to do no injury to the partners who chose to go on under the new arrangement.

The eases are numerous to shew that when one of the parties to a contract violates it, the other may rescind it and withdraw; and the general rule is, that if the party elects in such case to rescind, he may do it, provided the other party is left in statu, quo.- Stevens v. Cushing, 1 N. H. Rep. 18 ; Danforth v. Dewey, 3 N. H. Rep. 79 ; Wiggin v. Foss, 4 N. H. Rep. 292; Child v. Moore, 6 N. H. Rep. 33 ; Okell v. Smith, 1 Starkie’s R. 107 ; Cash v. Giles, 3 Car. & P. 407; Percival v. Blake, 2 Car. & P. 514 ; Campbell v. Flemming, 1 A. E. 42; Kingsley v. Wallace, 14 Maine 57; Potter v. Titcomb, 22 Maine 300 ; Masson v. Bovet, 1 Denio 69; Hunt v. Silk, 5 East 449; Conner v. Henderson, 15 Mass. 392.

The case of Hunt would seem, on this point, to be clear of difficulty. The statement of the answers, that the defendants had heard and believed that Hunt, either before or after the alteration in the articles, had said that he was a partner, if competent at all, is quite too loose to be made the foundation of a judgment; and the fact that he was present at the meeting when the company was dissolved, and when called on to vote [21]*21as a member declined, can certainly have no tendency to shew his assent to the change, or that he admitted himself to be a partner.

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Cite This Page — Counsel Stack

Bluebook (online)
32 N.H. 9, Counsel Stack Legal Research, https://law.counselstack.com/opinion/abbot-v-johnson-nh-1855.