Rathke v. Griffith

218 P.2d 757, 36 Wash. 2d 394, 18 A.L.R. 2d 1349, 1950 Wash. LEXIS 307
CourtWashington Supreme Court
DecidedMay 13, 1950
Docket31148
StatusPublished
Cited by27 cases

This text of 218 P.2d 757 (Rathke v. Griffith) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rathke v. Griffith, 218 P.2d 757, 36 Wash. 2d 394, 18 A.L.R. 2d 1349, 1950 Wash. LEXIS 307 (Wash. 1950).

Opinions

Robinson, J.

This case involves two actions, consolidated for purposes of trial, in which respondent sought and obtained judgment against appellants Griffith, on account of advances made by respondent to the partnership known as [395]*395.Midfield Packers, a frozen foods concern, in which Mr. Griffith was allegedly a general partner. The amounts of the judgments are not at issue, and the sole question raised on appeal concerns the status of Mr. Griffith in the partnership. If he was, as is asserted, a general partner, he is liable to respondent; on the other hand, he urges that he was a limited partner only, and it is conceded that, if he is correct in this contention, he may not be held responsible for the debts in question. The facts in the case are as follows:

On or about August 14, 1942, Mr. Griffith, in company with several others, executed a writing, denominated “Articles of Limited Copartnership,” which provided that tlie parties thereto were associating under the firm name of Midfield Packers, an organization formed for the purpose of canning and otherwise processing fruits and vegetables. Therein appellant Griffith is described as a limited copartner, and his liability is fixed at one thousand dollars. On December 8, 1942, the articles were filed in the office of the Thurston county auditor. Mr. Griffith’s only contribution to the partnership consisted of his assuming the indebtedness of the Midfield Packers on a certain truck. He paid this indebtedness in full, the entire payment amounting to over one thousand dollars.

In 1944, the original agreement was supplemented by another agreement allowing certain of the original parties to withdraw from the concern, and specifying that Mr. Griffith was to remain in the organization as a limited partner. This agreement was likewise filed with the Thurston county auditor on April 3, 1944. No publication of the certificate of partnership, or of the modification thereof, was ever made by the parties in accordance with the requirements of Rem. Rev. Stat., § 9969 [P.P.C. § 768-7], which statute was in force during this period.

The Midfield Packers entered into business, and, in the course of time, contracted the indebtedness which has become the subject of this action. Mr. Griffith testified that, upon learning that creditors of the partnership were claiming that he was a general partner, he immediately executed [396]*396a bill of sale by the terms of which he conveyed all of his interest in the partnership to the two individuals named as general partners in the original articles and in the later modification. This bill of sale purports to have been executed in November, 1946, and was filed in the office of the Thurs-ton county auditor.

It would appear that, in a number of respects, the parties involved in the organization of the Midfield Packers failed to comply with the strict terms of the limited partnership statutes in force at the time. Their most significant lapse was their failure to publish the certificate of partnership, in accordance with the terms of Rem. Rev. Stat., § 9969 (in effect prior to 1945), which provided that:

“The partners shall, for four consecutive weeks immediately after the filing of the certificate of partnership, publish a copy of the same in some weekly newspaper published in the county where the principal place of business of the partnership is, or if no such paper be published therein, then in some newspaper in general circulation therein,

The statute further provided that, until this requirement was complied with, the partnership was to be deemed general. Rem. Rev. Stat., § 9969. Neither of the parties to this action has referred us to any Washington cases interpreting this statute, but it is admitted that, in jurisdictions where similar statutes were in force, it was customary to construe them strictly and literally. In the present case, the trial court took the view that the failure of the parties to comply with this, and with certain other statutory requirements not necessary to be discussed here, had the effect of imposing liability as a general partner upon Mr. Griffith, the alleged limited or special partner. It would appear that the trial court’s decision was in accord with the majority of the cases decided in other states under the old type of limited partnership laws. The question before us is whether the passage of the uniform limited partnership act in 1945 changed the situation with respect to attempted limited partnerships formed prior to its adoption. In this connec[397]*397tion, it is pertinent to consider briefly the history of the concept of the limited partnership in the United States.

This form of association, though common on the continent of Europe since the middle ages, was unknown to the common law of England and the United States, and was originally borrowed from the civil law of France. Clapp v. Lacey, 35 Conn. 463; 3 Kent’s Commentaries (14th ed.) 38. Ames v. Downing, 1 Bradford (N. Y.) 321, includes an interesting account of the historical background of the limited partnership; see, also, Jacquin v. Buisson, 11 Howard’s Practice Repprts (N. Y.) 385. From their earliest inception (in New York and Connecticut in 1822), limited partnership statutes, being in derogation of the common law, were strictly construed by most courts. Pierce v. Bryant, 87 Mass. 91; Holliday v. Union Bag & Paper Co., 3 Colo. 342; Richardson v. Hogg, 38 Pa. 153. The view was commonly taken that the special or limited partner was essentially a general partner, with immunity from personal liability only on condition of full and exact compliance with the statutory requirements as to the details of formation of the association. Crane on Partnership 81, § 26, note 15. At a later date some courts began to take a more liberal view, and to hold that “substantial compliance” with the statutory terms was sufficient to free the special partner from liability. Thus, the statutes often provided that, at the time of filing the certificate of partnership, one of the general partners should file an affidavit stating that sums specified in the certificate of partnership to have been’ contributed by each of the special partners had actually been paid in cash; and they commonly further provided that any false statement in this affidavit would result in the alleged special partners being held liable as general partners. The earlier cases held that a statement that the payment had been made in cash when it had actually been made by check (and the check had not been presented for payment at the time of the filing of the affidavit), was a false statement within the meaning of the latter proviso, and rendered all parties to the transaction liable as general partners. Durant v. Abendroth, 69 N. Y. 148, 25 Am. Rep. 158; McGinnis v. Farrelly, 27 Fed. 33. (We [398]*398may note that these cases, dated 1877 and 1886, respectively, are among those relied on by respondent here.) Later cases, in recognition of the fact that payment by check is commonly accepted as payment in cash, relaxed this rule, and, expressing the view that, in the situation described, it would be unreasonable to hold the special partner to general liability, refused to do so. Chick v. Robinson, 95 Fed. 619, 52 L. R. A. 833; White v. Eiseman, 134 N. Y. 101, 31 N. E. 276.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Carver v. Velodyne Acoustics, Inc.
202 F. Supp. 2d 1147 (W.D. Washington, 2002)
Reiman v. International Hospitality Group, Ltd.
614 A.2d 925 (District of Columbia Court of Appeals, 1992)
8 Brookwood Fund v. Sloate
148 A.D.2d 661 (Appellate Division of the Supreme Court of New York, 1989)
Hays v. State
766 P.2d 785 (Idaho Supreme Court, 1988)
Direct Mail Specialist, Inc. v. Brown
673 F. Supp. 1540 (D. Montana, 1987)
Molander v. Raugust-Mathwig, Inc.
722 P.2d 103 (Court of Appeals of Washington, 1986)
General Electric Credit Corp. v. Stover
708 S.W.2d 355 (Missouri Court of Appeals, 1986)
Dwinell's Central Neon v. Cosmopolitan Chinook Hotel
587 P.2d 191 (Court of Appeals of Washington, 1978)
Opinion No.
Texas Attorney General Reports, 1978
Untitled Texas Attorney General Opinion
Texas Attorney General Reports, 1978
Frigidaire Sales Corp. v. Union Properties, Inc.
544 P.2d 781 (Court of Appeals of Washington, 1976)
Delaney v. Fidelity Lease Limited
526 S.W.2d 543 (Texas Supreme Court, 1975)
I.R.E. Financial Corp. v. Ferer
7 Va. Cir. 442 (Bedford County Circuit Court, 1975)
Delaney v. Fidelity Lease Limited
517 S.W.2d 420 (Court of Appeals of Texas, 1974)
Trans-Am Builders, Inc. v. Woods Mill, Ltd.
210 S.E.2d 866 (Court of Appeals of Georgia, 1974)
Gast v. PETSINGER
323 A.2d 371 (Superior Court of Pennsylvania, 1974)
Sparkman & McLean Co. v. Govan Investment Trust
478 P.2d 232 (Washington Supreme Court, 1970)
Weil v. Diversified Properties
319 F. Supp. 778 (District of Columbia, 1970)
J. C. Wattenbarger & Sons v. Sanders
191 Cal. App. 2d 857 (California Court of Appeal, 1961)

Cite This Page — Counsel Stack

Bluebook (online)
218 P.2d 757, 36 Wash. 2d 394, 18 A.L.R. 2d 1349, 1950 Wash. LEXIS 307, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rathke-v-griffith-wash-1950.