Guarantee Trust & Safe Deposit Co. v. E. C. Drew Investment Co.

107 La. 251
CourtSupreme Court of Louisiana
DecidedNovember 15, 1901
DocketNo. 14,108
StatusPublished
Cited by28 cases

This text of 107 La. 251 (Guarantee Trust & Safe Deposit Co. v. E. C. Drew Investment Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Guarantee Trust & Safe Deposit Co. v. E. C. Drew Investment Co., 107 La. 251 (La. 1901).

Opinion

The opinion of the Court was delivered ;by

Provosty, J.

The defendant firm, the E. C. Drew Investment Company, was engaged in the business of buying and selling lands and timber and of acting as agent for the owners of lands and timber in selling the same. It bargained with the co-defendant, Manning S. [252]*252Maguire, for the sale to him of timber, and referred him to its agent Lee Harris, one o± tne dexendants, to' point out the timber and agree upon a price. Harris pointed out the timber of plaintiff, and Maguire out, removed and sold the same. And this suit is ±or damages against all said parties, and against the members of the E. O. Drew Company individually, in solido, upon allegations of conspiracy to depredate upon plaintiff’s lands.

Maguire pleads the general denial, and that he bought the timber in good faith. The E. O. Drew Investment Company and the members individually, plead the general denial, and also- that the timber sold by them was on their own property. They specially deny the allegations of conspiracy.

We think that Maguire bought the timber in goo.d faith. Drew & Co. were a reputable firm selling timber for their own account and for others; to deal with them was in regular course. Maguire was under no obligation to investigate their authority; our law does not expect that suspicion and distrust shall inspire the conduct of our business men in dealing with each other, but rather an honest business confidence. Good faith, says our code, is presumed until disproved.

For certain purposes registry conveys notice, or knowledge, and defendant’s counsel argues that the registry of plaintiff’s title conveyed to Maguire knowledge that Drew & Co. were not owners of the land. Counsel cites in support ©f this contention the case of Heirs of Dohan vs. Murdock, 41 Ann. 494. The case is good authority against the contention of counsel. See also the cases of 4. La. 474; 5 La. 242; 33 Ann. 769; 38 Ann. 885; and Heirs of Ford vs. Phillips, 47 Ann. 339.

The E. O. Drew Investment Company and the individual members thereof must be held liable to plaintiff as trespassers in bad faith. The sale ©f the .timber was made advisedly; and it was made in the course of the partnership business, by the managing partner of the firm, in the name of and for the benefit of the firm; and the price went into the coffers of the firm. Under these facts all the partners are liable.

Their defences are, first, that Drew did not authorize Harris to sell the timber on the land of plaintiff, but only the timber on the land of the E. C. Drew Investment Company,; and, second, on the part of the individual members of the firm, that they had no knowledge of the transaction, and, as. a consequence, are, not parties to it and are not responsible for it.

[253]*253If it were conceded that Mams m selling the timber of plaintiff transcended his authority, still, on lamiliar principles, the partnership would be liable, since the act was done m the course of the execution of the agency.

But, as a matter of fact, Harris did not transcend his authority. When he made the sale he had in his possession a map on which were marked the lands of the Drew Company, and among these the lands of the plaintiff figured; and he testifies that this map was given him by Drew for his guidance in making the sale. If so, he did not transgress his authority. Drew was not permitted to testify on the trial, as to whether he had, or not, given such a map to Harris, the court holding that the point was settled by a judgment on a rule taken on Drew early in the case to produce the map; which, it seems, had been left by Harris in the office of the Drew Co. Whether this ruling was correct or not, need not be considered, for if we assumed that Drew had testified and had denied most positively and circumstantially that he hád given the map, we should accept the statement of Harris on the subject; and this for two reasons: first, that it accords with the attending circumstances of the case; and, secondly, that on the trial of the rule in question Drew testified that he did not “exactly remember” whether he had given any map at all to Harris; and, of course, this absence of recollection could not well be reconciled with a subsequent positive denial.

The want of knowledge on the part of a member of a firm of the tort of his co-partner will not be good ground for exemption from liability for such tort, if, as in this ease, the tort was committed in the course of the partnership business, and in the name of' and for the benefit of the partnership; and especially if the partnership profited by the transaction.

In combatting this proposition, counsel for defendant cite Addison on Torts, vol. 1, p. 667, as follows:

“One partner cannot drag another into a trespass without his previous consent, or without his subsequent concurrence. It must be shown, either by evidence before the transaction that they joined in committing the trespass, or by evidence afterwards that they concurred in and received the benefit of it.”

If by this is meant merely what is said, namely, that as a general proposition one partner cannot drag his co-partners without their consent into every trespass which he may choose to indulge in, we have [254]*254nothing to say; but if it is meant to contradict the proposition laid down above, then we must call upon the author to cite his authorities. Two cases are reterred to by him in his marginal notes in support of the text. One of these eases, Petrie vs. Lamont, we have not had access to; the other, Chester vs. Dickerson et als, 54 N. Y. 1, was cited either by mistake, or as a case contra; for it certainly does not support the text.

One of the members of a partnership between dealers in real estate poured petroleum upon a tract of land to induce plaintiff to believe that it was oil producing land, and sold the land to plaintiff as of that character, all without the knowledge of his co-partners: held, syllabus, as follows:

“Where a fraud is perpetrated by one of the members of such a partnership in the prosecution of a partnership enterprise, all the partners are liable, although the others had no connection with, knowledge of, or participation in the fraud.”

Thus it is seen that the ease does not support the text. But counsel cite one of our decisions, Allen, Nugent & Oo. vs. Carey et als, 33 Ann. 1455, as supporting the text in question. On examination it will be found that that case is authority for nothing more than that a partnei cannot bind the firm as security for the debt of himself, or of a third person, outside of the course of the partnership business.

The proposition laid down by us above is well supported by authority.

In the Am. & Eng. of L. Vol. 17, p. 1067, we find the following:

“While the willful and malicious torts of a member of a firm are not usually within the scope of his employment, and consequently do not render his partners liable, yet if .such an act is committed clearly and plainly for the benefit of all, and in the usual and ordinary prosecution of the partnership business, all are liable, notwithstanding the malicious motives of the partner committing the act.” Vol. 17, p. 1067. .

Story, treating the same subject, after discussing the liability as deduced from the maxim, qui facit per alium facit per se, goes on, as follows:

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Bluebook (online)
107 La. 251, Counsel Stack Legal Research, https://law.counselstack.com/opinion/guarantee-trust-safe-deposit-co-v-e-c-drew-investment-co-la-1901.