The agreement executed by the defendants, March 23, 1864, made them partners. It provides for a joint business, to which McDonald was to give his personal attention, and Hennessy was to furnish $800. This $800 was not a loan, but was to be furnished as capital, as no provision is made for its repayment. Hennessy, however, was to incur no further risk nor assume any further responsibility than the *Page 553 $800. This was placed in peril and might be lost, and if the loss should be greater than the $800, McDonald was, as between him and Hennessy, to bear it. If there was any net profit, Hennessy was to have one-quarter of it. It thus appears that Hennessy was to share in the profits of the business as profits, not as a compensation for wages he was to earn, or interest on money loaned to McDonald, but in consideration of his share of capital invested and imperiled in the joint business. Whatever the intention of the parties may have been, this, as to third persons, made him a partner. Here, within the meaning of the authorities, was a communion of profits, and hence a partnership. (Collyer on Part., § 18; Lindley on Part., 17; Winship v. Bankof the United States, 5 Peters, 529, 560; Champion v.Bostwick, 18 Wend., 175.) It matters not that McDonald was to assume all the risk and bear all the loss beyond the $800. "A man, on entering a partnership, may stipulate to be free from all liability for loss, and such stipulation will hold good as between himself and his co-contractor. In such case he will still be a partner, enjoying, in addition to the advantages of partnership, the indemnity offered him by his companion." (Collyer on Part., § 18.)
But here was also a community of loss. Hennessy's $800 was put in peril, and to that extent he was liable to be involved in loss with his copartner. Hence, even if it were necessary, which is denied (Manhattan Brass Man. Co. v. Sears, 45 N.Y., 797), that there should be a community of loss as well as of profit to constitute a partnership, that condition exists here. Hence I have no hesitation in holding that the defendants were partners, as between themselves, and for a much stronger reason as to third parties.
The next question is, whether Hennessy is liable upon the draft in suit. The agreement did not provide for a partnership name. But as McDonald alone was to give personal attention to the business, and as Hennessy was to incur no risk and assume no responsibility, no firm name being expressly adopted in the agreement, it is fair to infer that the firm business was *Page 554 to be done in the name of McDonald. He was authorized to draw the drafts, to raise money for the business. Hence, McDonald's name was to all intents the firm name, and drafts drawn in that name to raise money for the use of the firm must bind the firm. (Winship v. Bank of United States [supra]; Story on Part., § 139.)
This draft was drawn and the money all used in the firm business, and hence both members of the firm were bound by it, as if they had both signed it.
While the complaint is technically defective in not directly alleging that the draft was drawn in the firm name, or that it was the draft of the firm, yet taking the whole complaint, together with the fact that both partners are joined as defendants, there is enough to show that the cause of action set forth is based upon the draft, as a firm draft, and that the liability sought to be enforced is the firm liability on the draft. As no objection was taken to the complaint by demurrer, and the defendants could not have been misled, the complaint should, at this stage of the case, be held sufficient in substance.
The judgment should be affirmed with costs.