Cole v. Moxley.

The following questions are presented in this cause: Was there a partnership between the plaintiff and defendant? If so was it for a fixed, or for an indefinite period? When was it dissolved ? Is the decree of the circuit court right? Domat's definition of a partnership is, "a contract between two or more persons, by which they join in common either their whole substance or a part of it, or unite in carrying on some commerce or some work, or some other business, that they may share among them all the profit or loss, which they may have by the joint stock which they have put into partnership." It is usually defined to be "a voluntary contract between two or more competent persons, to place their money, effects, labor and skill, or some or all of them, in lawful commerce or business, with the understanding that there shall be a communion of profits thereof between them," and of course if there is loss they must share that. Story on Partnership, sec 2.

It appears by the pleadings and proof in this cause, that the defendant Moxley bought out the contract for carrying the mail, between Weston and Nicholas Court House, about the first of January, 1869, of Wm. P. Francis; that the said Moxley and the plaintiff, Cole, jointly paid Francis therefor the sum of $350.00; that they entered into a partnership, to carry said mail and to equally share the profits or losses. That the contract of Francis was to expire on the 1st of July, 1871. That they did carry said mail under said partnership arrangement, until the 16th of May, 1870, when Moxley took possession of the business himself and refused to let Cole have anything further to do with it. That about the 1st of February, 1870, the Postoffice Department of the United States, changed in some respects the contract, requiring the mail to be carried twice a week, from Weston to Braxton Court House, on the route instead of once, and increased the compensation therefor more than $500.00 per annum. This may have been the reason why Moxley wanted to dissolve the partnership and draw all the profits himself. After this increase of pay, however, Cole Moxley carried the mail together, as usual, until the 16th of May following. Moxley, in effect, admits a partnership in carrying the mail, but claims that it was only to continue as long as their partnership in the livery stable business continued, and says that was dissolved in May, 1870. His language is, "after such purchase, (from Francis) this defendant proposed to Cole, to help carry the mail while they should be engaged together in the livery business, it he would pay this defendant, half of what he agreed to pay said Francis for said contract and pay half the expenses, and undergo half the obligations throughout. With this understanding they did carry the mail with their livery horses together until the 14th of May, 1870." He says about the 1st of May, 1870, they divided their stock, vehicles, c., and ended the whole connection. This claim of the defendant is not sustained by his own deposition even, and is expressly shown to be incorrect, by the testimony of the plaintiff, and A. C. Hale, who both clearly show that the partnership in the livery business was dissolved in the spring of 1869, not long after the arrangement was made between them for carrying the mail. I think the proof shows a partnership clearly, and the commissioner reports from evidence before him that the parties had adjusted their accounts on the 1st day of January, 1870, and for that reason he deemed it unnecessary to make any statement for the time anterior to that date. There surely was no dissolution then, as the defendant admits that they carried the mail together until the 16th of May, 1870, four months and a half after that time.

It is insisted by defendant's counsel that upon the authority ofWilkinson v. Jett, 7 Leigh 115, the agreement between the parties did not amount to a partnership. The cases are entirely dissimilar. In that case Wilkinson was the sole contractor for carrying the mail and employed Jett to carry the mail half the time, and promised to pay him for so doing, one-half of what he received from the department, when he received it. There was nothing to show that there was any partnership between them, no agreement to share profits and suffer loses together. It was a mere employment. Here the parties each put in one-half the money to buy the contract, and were to share profits and suffer losses equally.

Was the partnership for a fixed or for an indefinite period ?

Judge Story, in his work on Partnership sec. 277 says, "the question sometimes occurs whether a partnership under all the circumstances of the case, is properly to be treated as a partnership at will, or a a partnership for a limited period. It is by no means necessary that there should be an express stipulation either way; for its intended duration may often be ascertained by implications or presumptions arising from the acts and conduct of the parties and other accompanying circumstances. In the absence however of all acts or circumstances, which clearly rebut and control the inference, the conclusion of law is that the partnership is intended to be at the mere will and pleasure of the parties. But acts and circumstances may greatly qualify or even overturn this conclusion."

From the acts and conduct of the parties and other accompanying circumstances, it is clear to my mind that the parties in this case intended the partnership to continue, until the Francis contract expired, and no longer. Then the subject of the partnership was gone and there was no longer anything upon which it could operate. The contract was bought by Moxley and paid for by Moxley and Cole, and owned jointly by them, and when that expired on the 1st of July, 1871, their partnership based thereon ceased.

When was it dissolved ?

A partnership may expire by its own express or implied limitation, whenever the event has occurred, which the parties naturally, or necessarily contemplated as its just termination. This may arise in two ways: 1. By the extinction of the thing which constituted the sole subject of the partnership. 2. By the completion or accomplishment of the entire business for which the partnership was formed. The partnership in this case continued until the contract, which was the sole subject thereof, expired on the 1st of July, 1871, unless it was in some other way dissolved before that time.

It is claimed, by the counsel for defendant, that it was a partnership at will, which could at the pleasure of either of the parties be dissolved, and that Moxley did dissolve it on the 16th day of May, 1870.

We have seen that it was a partnership for a fixed period. Was it then in the power of Moxley to dissolve it in the manner he claims he did?

A partnership for a limited period, cannot be dissolved at the mere pleasure of one of the partners, but may be dissolved for reasonable cause. McMahon et al. v. McClernan, 10 W. Va. 419.

Judge Story, section 275. (Story on Part.), says: "Whenever a stipulation is positively made, that the partnership shall endure for a fixed period, or for a particular adventure or voyage, it would seem to be at once inequitable and injurious to permit any partner at his mere pleasure, to violate his engagement, and thereby to jeopard, if not sacrifice the whole effects of the partnership; for the success of the whole undertaking may depend upon the due accomplishment of the adventure or voyage, or the entire time be required to put the partnership into beneficial operation. It is no answer to say that such a violation of the engagement, may entitle the injured party to a compensation in damages; for independently of the delay, and uncertainty attendant upon any such mode of redress, it is obvious that the remedy may be, nay, must be, in many cases, utterly inadequate and unsatisfactory. If there be any real and just ground for the abandonment of the partnership, a court of equity is competent to administer suitable redress. But this is exceedingly different from the right of the partner sua sponte from mere caprice, or at his own pleasure to dissolve the partnership." This reasoning, we think, is sound. It was also held, by the court, in McMahon v. McClernan, supra, that "when a dissolution of a partnership has taken place, an account will not only be decreed, but if necessary, a manager or receiver will be appointed to close the partnership business, and make sale of the partnership property, that a final distribution may be made of the partnership effects."

Here the partner claimed the right at his own pleasure, without any just ground to dissolve the partnership, seize the whole of the subject of the partnership, and appropriate it to his own use. This he could not do; and it is clear that by no action of his was the partnership dissolved, but that it continued to the 1st day of July, 1871, when it expired by limitation.

For the foregoing reasons, the decree of the circuit court of Lewis county, rendered in this cause on the 26th day of July, 1875, is reversed, with costs to the appellant, and this Court proceeding to render such decree as the circuit court should have rendered, the plaintiff's exception to the commissioner's report is sustained, and the statement of said commissioner based on the theory that the partnership was dissolved on the 1st day of July, 1871, is approved and confirmed, and the plaintiff must recover of the defendant, the sum of $133.11, the amount found due by the commissioner, with interest thereon, from the 30th day of January, 1874, together with his costs about his suit expended.

JUDGES GREEN and MOORE concurred.

DECREE REVERSED.