American Cotton College v. Atlanta Newspaper Union

74 S.E. 1084, 138 Ga. 147, 1912 Ga. LEXIS 232

• Court: Supreme Court of Georgia
• Decided: May 15, 1912
• Status: Published

Opinion

Lumpkin, J.

The Atlanta Newspaper Union brought suit against the American Cotton College, alleged to be a firm composed of J. H. Dickinson and E. L. Wall, on an open account for advertising during the months of July, August, September, and October, 1908. Dickinson answered that he could not admit or deny the allegations of the petition, for Want of sufficient information. Wall denied the indebtedness, and pleaded that he was not a partner in the alleged firm. The jury found for the plaintiff the amount of the account. A motion was made for a new trial, which was overruled, and exception was taken.

The headnotes require no elaboration except in one particular. In the ninth and tenth grounds of the motion for a new trial complaint is made of charges on the subject of the liability of an •ostensible partner, or one who holds himself out to the world as a partner, or permits himself to be so held out. Section 3157 of the Civil Code of 1910 declares that “An ostensible partner is one whose name appears to the world as such, and he is bound, though he have no interest in the firm.” This section was not a new rule, but was a codification of the pre-existing law. It recognizes the fact, that, while a joint interest in partnership property or in the profits and losses of the business constitutes a partnership as to third persons (§' 3158), one may be bound as a partner, though he has no interest. As to liability as a partner by one who holds himself out as a member of a firm, though he is actually not such, it has been declared that he is liable as a partner only to those persons who have acted on the faith of the truth of the appearance. Bowie v. Maddox & Goldsmith, 29 Ga. 285 (74 Am. D. 61); Carlton v. Grissom & Co., 98 Ga. 118 (26 S. E. 77); Stewart & Son v. Brown & Co., 102 Ga. 836 (30 S. E. 264).

In the case now under consideration the evidence was conflicting as to the existence of the partnership. The plaintiff introduced evidence tending to show that Dickinson and Wall were partners. Wall denied this, and claimed that he was a mere employee of Dickinson. Certain letter-heads were introduced in evidence, and were shown to have been used with the knowledge and consent of Wall. They contained the names of Dickinson and Wall, with the words “associate presidents” between 'them, and were followed by the words “American Cotton College,” and certain statements descriptive of its character. These were admissible as evidence tending to prove the existence. of a partnership. It was further contended, that, if through them Wall held himself out to the world as a partner of Dickinson, or permitted it to be done, and the plaintiff acted on the faith thereof, Wall was bound as a partner, whether in fact he had any interest in the firm or not. The judge gave certain instructions on the subject. While the principle of law involved is sound as an abstract statement, the evidence did not authorize it as applicable to the case. The plaintiff introduced in evidence three letter-heads of the character indicated, attached to letters written to it, but none of them appear to have been received by it prior to the making of the contract for the advertising; nor did it 'appear that the plaintiff acted in reliance on any statement appearing in such letter-heads. It was accordingly erroneous to charge as to liability which might arise from facts as to which-there was no sufficient evidence.

Judgment reversed.

All the Justices concur.