Troy Iron & Nail Factory v. Winslow

45 Barb. 231, 1864 N.Y. App. Div. LEXIS 201
CourtNew York Supreme Court
DecidedSeptember 19, 1864
StatusPublished
Cited by1 cases

This text of 45 Barb. 231 (Troy Iron & Nail Factory v. Winslow) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Troy Iron & Nail Factory v. Winslow, 45 Barb. 231, 1864 N.Y. App. Div. LEXIS 201 (N.Y. Super. Ct. 1864).

Opinion

Miller, J.

This suit was brought to recover the amount of an assessment made upon the defendants, as members of a voluntary association, known as the “Wynant’s Kill Improvement Association,” formed under an act of the legislature of this state, and to compel the defendants specifically to perform the covenants and conditions contained in the articles of association on their part, to be performed by the agreement entered into by them. Both the plaintiffs and the defendants were members of the association, and the plaintiffs’ right to a recovery is based upon the rule that for a breach of an express covenant contained in the articles of partnership, one partner may sue another at law, without praying for a dissolution, or for an account.

Various objections are taken to the plaintiffs’ right to recover, which I will proceed to examine and consider.

It is urged that the copartnership was dissolved before the purchase of the Knowlson farm and lease, on the fourth day of July, 1859.

1. By the sale of the property mentioned in the complaint as “the property of Isaac Merritt, executor &c. of R. P. Hart, deceased,” to other parties.

2. By the change of the • ownership of the property of the Troy Woolen Company, a corporation, and of- the property [241]*241of the Albia Gotten Factory, and .of the property of the Sand Lake Cotton Factory, and, by the fact that persons owning such properties respectively, or parts of such properties, at the time of the signing of the articles of association, had ceased before said fourth day of July, 1859, to be members of said association.

3. By the defendants, in 1858, withdrawing from the association, when they objected to the purchase of Glass lake and the farming lands connected with it, and refused to pay assessments or to co-operate in its business, and to participate in the proceedings of the association.

First. The sale of the Hart property, and the withdrawal of Merritt the executor, did not effect a dissolution of the association, in my opinion. The articles of association were intended to provide, and I think have sufficiently provided, for such a contingency, so that a change of ownership in property would not dissolve the copartnership and thereby defeat the very purpose and object for which the association was instituted and organized. By the articles it is evident that it was intended that the association should be a continuous and a permanent organization. The only condition upon which any of the associates, whether original or otherwise, were allowed to withdraw and dissolve their connection with the association, was that they had ceased to be owners and occupants of the property in reference to which they had become members. Upon a sale or disposition of their privilege, and upon giving notice to the secretary of that fa¿t, they were discharged from all further liability. Their successors could be substituted in their places, upon signing the articles, and become members of the association, subject to the same liabilities and entitled to the same privileges. The legal effect of this arrangement was no more nor less than a contract entered into between the associates, that notwithstanding the withdrawal of one or more of their number and the substitution of another or others, or not, as might or as might not be done, the organization should continue intact and perfect ip all its [242]*242parts, so long as its purposes and objects were being carried out and enforced and remained unaccomplished. The articles of association embraced precisely such an agreement, and it was never intended by them that the retirement of a member by the sale of his property should produce a dissolution.

When it is quite apparent that the organization was to continue -until its entire purposes were fully accomplished, and the articles provided for its continuance for a long period of time, as in a case like the present, I am not prepared to assent to the doctrine that it may be dissolved at the will of any one or more of the associates. (See Story on Partnership, §§ 269, 271, 272; 34 Barb. 334.)

Although such a rule would ordinarily apply to copartnerships generally, yet it never has been held applicable to associations like the one in question. In Merrick v. Brainard, (38 Barb. 574,) where by the partnership agreement it was provided that the interests of the partners should be transferrable arid might be transferred at the will of each partner, and that the purchaser should be clothed with all the rights of his vendor, it was held that a transfer of the interest of a partner would work no dissolution, and the purchaser became to all intents and purposes a partner.

There is perhaps some analogy between the case cited and the one at bar, although it is optional here, with the purchaser, to become a member of the association upon signing the articles or not, as he chooses.

I do not think that the authorities cited by the defendants, or the principle before referred to, uphold the doctrine that in a case like this, the will and caprice of a single associate could defeat the very purpose of the organization. It would be contrary' to good faith, and clearly inequitable, to permit the dissolution of an association of this character in a manner so summary.

The association differed in many respects from an ordinary copartnership. Its object was the improvement of the Wynant’s kill stream' by increasing the head of water and [243]*243regulating the flow thereof for the supply of mills and establishments on said stream by forming reservoirs, &c. and by such other works and improvements as would increase the usefulness of said stream, for milling purposes. Each of the associates was bound to contribute a certain proportion for improvements, in the ratio fixed by individuals named in the articles, for the real estate and property owned by them respectively. The real estate held and acquired was conveyed to trustees upon the trust authorized by the act of the legislature under which the association was organized. The associates thereby became entitled to an interest in the property acquired by the trustees as shareholders of the same, which only ceased upon a conveyance of the mill jirivileges or establishments held by them. The associates were the cestui que trusts for whose benefit the property acquired was held. Through them they held-an interest in the real estate conveyed to the trustees, somewhat different from that of copartners and which I think placed them upon a different footing from that of ordinary members of a copartnership. They could not by a conveyance of their property dissolve the association. Under the provision made for such a contingency, such an act would not be even notice of a desire to dissolve the concern, and would not effect a dissolution.

. Second. Neither did a change in the ownership of the property of three of the associates named, and the fact that they had ceased to be members, produce a dissolution of the association. The purchasers on such sales became members, and became entitled to all the privileges of their predecessors under the articles of the association. They were accepted and recognized by the defendants as such, and I think they are not in a position now to insist that a dissolution was effected in this manner.

Third. The position that the association was dissolved by the withdrawal of the defendants, is sufficiently answered by the remarks made in reference to the first objection.

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Bluebook (online)
45 Barb. 231, 1864 N.Y. App. Div. LEXIS 201, Counsel Stack Legal Research, https://law.counselstack.com/opinion/troy-iron-nail-factory-v-winslow-nysupct-1864.