Soberg v. Sanders

Edwin Sanders, John Miller, and Fred W. Sanders are engaged in business in Detroit as copartners under the name of Fred Sanders. On the evening of December 5, 1923, the left front wheel of a truck owned by the partnership ran over plaintiff's legs, resulting in a somewhat serious injury to him, to recover for which he brought this action against Fred Sanders personally. At the conclusion of plaintiff's proofs, the trial court directed a verdict for defendant, for the reason that he was not individually liable in damages to the plaintiff. Plaintiff seeks review of the judgment entered thereon by writ of error.

1. Defendant's Personal Liability. Under the common law the members of a partnership firm are jointly and severally liable for the tortious act of one of the partners, or of an agent or servant of the partnership, if committed in the course of his employment. 30 Cyc. p. 536; 20 R. C. L. p. 914; Baldwin on Personal Injuries (2d Ed.), 34; Rowley, Modern Law of Partnership, 1120, 1121; Roberts v. Johnson, 58 N.Y. 613;Sunlin v. Skutt, 133 Mich. 208.

Counsel for the defendant, however, insist that this rule is abrogated by the provisions of our uniform partnership act (Act No. 72, Pub. Acts 1917 [Comp. Laws Supp. 1922, § 7966]). Sections 13, 14, and 15 are relied on:

"SECTION 13. (Partnership Bound by Partner's Wrongful Act.) Where, by any wrongful act or omission of any partner acting in the ordinary course of the business of the partnership, or with the authority of his copartners, loss or injury is caused to any person, not being a partner in the partnership, or any penalty is incurred, the partnership is liable therefor to the same extent as the partner so acting or omitting to act.

"SEC. 14. (Partnership Bound by Partner's Breach of Trust.) The partnership is bound to make good the loss:

"(a) Where one partner acting within the scope of his apparent authority receives money or property of a third person and misapplies it and

"(b) Where the partnership in the course of its business receives money or property of a third person and the money or property so received is misapplied by any partner while it is in the custody of the partnership.

"SEC. 15. (Nature of Partner's Liability.) All partners are liable:

"(a) Jointly and severally for everything chargeable to the partnership under sections thirteen and fourteen;

"(b) Jointly for all other debts and obligations of the partnership but any partner may enter into a separate obligation to perform a partnership contract."

Under (a) of section 15 the partners are jointly and severally liable "for everything chargeable to the partnership under sections thirteen and fourteen." Under (b) of this section they are liable "jointly for all other debts and obligations of the partnership." Counsel for the defendant contend that the claim here made by plaintiff is a debt or obligation within the meaning of these words as here used. Clearly, it is not a debt owing by the defendant personally, or by the members of the firm. Lockhart v. Van Alstyne, 31 Mich. 76 (18 Am. Rep. 156); Morrow v. Murphy, 120 Mich. 204; Barney v. Insurance Exchange, 240 Mich. 199.

Is it an obligation? While an obligation rests upon every person to perform the duties imposed on him by law, we are impressed that as here used it refers to such obligations as arise out of the contractual relation which exists among partners. In the Lockhart Case, it was said:

"A debt is that which one person is bound to pay to another, either presently or at some future period; something which may be the subject of a suit as a debt, and not something to which the party may be entitled as damages in consequence of a failure to perform a duty or keep an engagement."

We have here a disputed claim, unliquidated, not arising out of contract; one which the defendant was under no legal obligation to pay until his liability had become fixed by a judgment rendered against him. When sued upon, it was not a debt or obligation of the partnership within the meaning of these terms as used in this section. These words have a well-recognized meaning in matters arising out of contract, but are rarely, if ever, used when speaking of a claim arising out of a tort or wrongful act. The statute but re-states the holding of this court that "the liability of partners on a firm obligation is joint, not several." Stewart v. Terwilliger,177 Mich. 313 (Ann. Cas. 1915C, 808). Whether under section 18 the partnership must indemnify the defendant in respect of any payment he may be required to make arising out of such claim is not before us for decision.

2. Negligence of the Driver. Plaintiff testified that, when crossing Griswold street in Detroit at its intersection with Grand River avenue, he saw a truck standing near the curb about 12 or 15 feet distant; that, when near the street railway track, he was run into and knocked down by a man going in the opposite direction, and that, after he fell, the truck started up and ran over and injured one of his legs. On cross-examination he testified that, after passing the truck, he did not again observe it until it was upon him. On re-examination he again testified that it was standing at the curb when he fell. While testimony elicited on cross-examination must be treated as evidence given on the part of the party calling the witness (Wilson v. Wagar, 26 Mich. 452), it must all be considered in determining the fact in dispute. Perkins v. Holser, 213 Mich. 579. When so considered, the testimony of plaintiff presented a question of fact. Where was the truck at the time plaintiff fell upon the crossing?Goonen v. Railroad Co., 218 Mich. 502, and cases cited; Robertson v. Budzier, 229 Mich. 619; Steinberg v. Lumber Wrecking Co., 238 Mich. 181.

The judgment is reversed and set aside and a new trial ordered, with costs to plaintiff.

FEAD, C.J., and FELLOWS, WIEST, CLARK, McDONALD, and POTTER, JJ., concurred. NORTH, J., did not sit.