Pollard v. Stanton

7 Ala. 761

• Court: Supreme Court of Alabama
• Decided: January 15, 1845
• Status: Published

Opinion

ORMOND, J.

— Both the charges given by the Court, are based upon the assumption, that, because by the articles'of dissolution of the old firms of B. Stanton, Jr., Labuzan & Stanton, Stanton, Pollard & Co. and B. & W. Stanton, and the es’-táblishment of the new house in Mobile, of Charles Labuzan, it was stipulated, that Pollard & Stanton, should receive a portion of the profits of the business of Charles Labuzan, they thereby become partners of the new house of Charles Labu-zan, as to third persons. This may be conceded, and yet it does nofnecessarily follow, that they are partners as between each other. Although they could not stipulate that one who was to receive a portion of the profits, should not be responsible to the creditors of the firm for its debts, yet, it was entirely competent for them to agree, that as between each other, the common incidents of a partnership should not follow ; and this they have explicitly done in the closing article, in which it is stated, “ that they should not be partners of Charles Labuzan.”

No principle of the law of partnership is better established, than this, that whilst the perception of profits, as such, imposes on the person receiving them, all the obligations of a partner as to third persons, as between each other, they may by their own contract, regulate their respective liabilities, in any manner they think proper. [Gow. on Part. 13, and cases cited ; Hesketh v. Blanchard, 4 East, 144; Winship v. The Bank of the United States, 5 Peters, 530.]

This proposition is directly denied by the Court, in both of its charges to the jury, and the jury are in effect told, that because the Plauters and Merchants’ Bank could have recovered from the plaintiff as a partner of Charles Labuzan, that therefore the plaintiff cannot recover from Labuzan, although he paid the debt as the surety of the house of Charles Labu-zan. Now there can be no doubt, that partners may stipulate between each other, that one shall receive a portion of the profits, and shall not be bound for the debts, or losses of the firm, and that as between themselves such a stipulation will be binding ; such in effect was the engagement in this case.

No question is made upon the record, as to the liability of the plaintiff, for the debts of the old firms, as the Court conceded, that by the substitution of the paper of C. Labuzan and B. Stanton, for that of the old firms, the liability of Pollard as partner was destroyed; nor does the record furnish us with the means of determining, whether any such liability continues, or not, and we therefore express no opinion upon it.

Let the judgment be reversed, and the cause remanded,