Dickson-Carroll Co. v. United States Fidelity & Guaranty Co.

199 S.E. 322, 58 Ga. App. 540, 1938 Ga. App. LEXIS 43

• Court: Court of Appeals of Georgia
• Decided: October 24, 1938
• Docket: 27068
• Status: Published

Opinion

Felton, J.

1. “Dickson-Carroll Company” imports the name of a corporation or partnership, and a suit so brought may be amended to show that the suit is brought against a corporation. Hall v. Bell Finance Co., 51 Ga. App. 304 (180 S. E. 374) and cit.

Decided October 24, 1938. Carl K. Nelson, James F. Nelson, for plaintiff in error. Blackshear & Blackshear, contra.

2. Where a partnership is succeeded by a corporation, the corporation is not liable for the debts of the partnership not assumed in a manner recognized by law. Culberson v. Alabama Construction Co., 127 Ga. 599 (4) (56 S. E. 765, 9 L. R. A. (N.S.) 411, 9 Ann. Cas. 507); Greenberg-Miller Co. v. Everett Shoe Co., 138 Ga. 729 (75 S. E. 1120) ; Georgia Co. v. Castleberry, 43 Ga. 187; Taylor Lumber Co. v. Clark Lumber Co., 33 Ga. App. 815 (127 S. E. 905).

3. Where a partnership incurs a debt, and the members thereafter form a corporation to take over the partnership business, which corporation never functions, the corporation is not liable for the debt of the partnership by reason of estoppel, for the reason that credit was not extended to it on the strength of the incorporation.

4. It appearing from the evidence that the debt sued for, an open account, was contracted by a partnership, it not appearing that the corporation later formed assumed it, and it appearing as a matter of fact that the corporation never functioned, the verdict for the plaintiff was not authorized, and it was error to overrule the defendant’s motion for new trial. It is not necessary to rule on the other questions raised.

Judgment reversed.

Stephens, P. J., and Sutton, J., concur.