Greiner v. Perry

KUNKLE, J.

Counsel have favored the court with briefs in which portions of the testimony are discussed and various authorities are cited.

We have read the record in this case with care for the purpose of ascertaining the facts disclosed thereby. We shall not attempt to quote in detail from the testimony. It will be unnecessary so to do, as counsel are thoroughly familiar with the same.

We have referred to the pleadings in some detail. We have done so for the purpose of calling attention to the issues actually raised by the pleadings.

This case was presented upon the theory that the plaintiffs in error were responsible for the injury which was done to the automobile of defendant in error by reason of the fact that they, viz., Carl Greiner and W. Bryan Little, were partners engaged in the business of commercial aviation and were using said Municipal Airport as their principal place of business under the name of Little-Greiner Air Service. The case proceeded upon the theory that Edward Selders was the agent of the said partnership and that such partners were therefore liable for the negligence of their agent Selders.

It must be kept in mind that this is an action in tort. It is not an action based upon a contract either express or implied, but the basis of this action is the tort, that is, the negligence of Edward Selders.

What might be sufficient to estop persons from denying a partnership in a case of contract is wholly different from showing liability in case of- a tort.

We have examined the briefs of counsel with care and find no authorities cited therein holding that individuals could be held as partners in an action in tort where no partnership existed and where such partnership was sought to be established solely by testimony tending to show that they had held themselves out as partners.

We have made some independent examination of the question and have found no reported decision holding that individuals may be held as partners in an action for tort where no partnership existed and where the testimony merely tended to show a holding out of themselves as partners. There may be decisions to that effect, but we did not find them.

For the purposes of this case, however, it is not necessary to hold that individuals may not be liable as partners in an action in tort by merely holding themselves out as such partners.

The issue raised by the pleadings is that an actual partnership existed between Carl Greiner and W. Bryan Little. The testimony fails to disclose that any partnership existed between Greiner and Little. The case was tried, however, upon the theory that Greiner was estopped by reason of his conduct from denying that a partnership existed.

It will be observed that under the pleadings the question of estoppel is not raised.

Under the rule announced in Ohio Jurisprudence, Vol. 16, pages 900 and 901 and the many authorities cited therein, if estoppel is relied upon it must be plead.

We will assume however that this question was properly before the court and jury.

We think the record clearly shows that at the time in question, viz., September 16, 1928, and at no time prior thereto did any partnership exist between Carl F. Greiner and Bryan Little. The record discloses the interest that Greiner took in aviation and that he owned the airplane in equestion; that Little was what might be termed a pioneer in aviation and for a fixed sum.was giving Greiner a course of flying lessons; that Griener permitted Little tq use his airplane free of charge for the carrying of passengers but not for the purpose of teaching students and that Greiner received no part of the moneys Little earned thereby nor any moneys from Little’s operations; that Greiner paid none of Little’s expenses and shared none of his losses and that they had no agreement or understanding between them except that Greiner paid Little a somewhat reduced price for his flying lessons and allowed Little to use his airplane for the purposes above stated; that they had talked about some future arrangement but that nothing was accomplished until in November, 1928, substantially two months after the accident in question, when a corporation was formed known as The Little-Griener Air Service, Incorporated.

The record shows that the defendant in error through the cross examination of the plaintiffs in error attempted to establish a partnership by estoppel in that Greiner had held himself out to the public as a partner and therefore should be estopped from denying the partnership.

Assuming, however, that the record discloses such acts of holding themselves out as partners by plaintiffs in error as would estop them from denying that a partnership existed, if the cause of action was based upon a contract this would not solve the case for the reason that it is not claimed that the defendant in error or her son, who was in charge of her automobile at the time in question, had ever seen any such publications or ever heard that Greiner had either directly or indirectly allowed himself to be held out as a partner. There is no claim in the record that the defendant in error knew that her son upon the date in question was going to take her automobile to the airport or as above stated that either she or her son had ever heard of any conduct upon the part of Greiner indicating that he was a partner or in any way connected with the airport.

In 36 Oh St, p. 135, in the case of Cook v Penrhyn Slate Company the third paragraph of the syllabus is as follows: .

“3. Where the conduct of a party is relied upon to charge him as a member of a firm of which he is not in fact a member, it should appear that the creditor relied on such conduct, and trusted the firm on the faith of such party being a member.”

•The record in this case is entirely silent upon the features necessary to bring the defendant in error within the reasoning of the above syllabus.

In 47 Corpus Juris, page 712 (§107) the rule is announced as follows:

“Persons not partners inter se can be subjected to liability because of a holding out only when a person seeking to hold such partners liable dealt with the ostensible partnership in the belief that the parties were partners.”

Reference has been made to page 732 of Yol.-47 of Corpus Juris in regard to partnership by estoppel. This paragraph is as follows:

“A finding in favor of an estoppel to deny a partnership liability may be sufficiently supported by evidence of representations by the new party estopped, either by statements made by him, or in his presence, or by his conduct, that the representations made came to the other party’s knowledge and that he relied upon it.”

Under this text, it is necessary that such representations came to the other party’s knowledge and that they relied upon them. These elements are wholly lacking in the case at bar.

The rule governing cases wherein an attempt is made to hold an individual as a partner upon the ground that he was held out as such partner is well stated in 20th Ruling Case Law, §513, as follows:

“The modern doctrine is that an alleged partner cannot be held liable as such on a contract made by the partnership with those who had no knowledge of the holding out, at the time the transaction was entered into, for as to such persons he is not estopped to deny the partnership relation, and persons holding themselves out as partners are liable only to those who have been misled and have acted on the faith of the appearance thus produced, or given credit to an apparent partnership in ignorance of the actual facts, and in the belief that those held out as partners were in fact members of the firm. Such holding out is immaterial as against a third person who had knowledge also of the real relation of the parties and that no partnership in fact existed. In all cases third persons seeking to enforce liability as a partner or one who has held himself out as such must exercise due diligence in ascertaining the facts, and must have a reasonable ground for believing that the person he seeks to hold as a partner was a member of the firm.”

Many errors are complained of, among them the charge of the trial court upon the question of partnership by estoppel.

The court undertook to charge the jury upon this subject and we think the charge as given is incomplete and therefore misleading. The charge should have defined what in law would constitute a partnership by estoppel, namely, not merely a holding out but a communicatiqn either directly or indirectly to the injured party of such holding out and the further fact that the person complaining was injured by relying upon such holding out.

Prom a consideration of the entire record, we can not escape the conclusion that the verdict is not supported by the testimony; that the trial court erred in the above instruction and that the verdict is against the manifest weight of the evidence.

Entertaining these views, the judgment will be reversed and the cause remanded.

HORNBECK, J, concurs.