Ross v. Cornell

Suit at Law by One Partner Against Another.—If a copartner, even by consent, retires from the firm of which he is a member, a suit at law cannot be maintained against him by the members who remain in the firm, for money alleged to be due from him to them in the copartnership transactions, unless there has been a final settlement of all the firm accounts and a balance has been struck. Idem.—In such case, if there are two or more members who remain in the firm, they cannot maintain a joint action at law against the member who retired from the firm. Effect of One of Several Partners Eetiring from the Firm.— If, in a case where there are several members of a partnership, one of them, even by consent, retires from the firm, this dissolution necessarily severs the copartnership relations of each of its members. What Necessary, for Partner to Sue Copartner at Law.—It may not be necessary, in order to enable a partner to maintain an action at law against a copartner, or one who has been such, to show an express promise to pay a sum ascertained as a balance due, but the balance itself must be one which has been ascertained by the act of all the partners, and agreed to as constituting such balance.

Appeal from the District Court of the Seventh Judicial District, County of Mendocino. The complaint averred that plaintiffs were, and since March 29th, 1869, had been partners in the manufacture and sale of lumber, and that plaintiff Ross and defendant Cornell, on the 4th day of January, 1867, formed a partnership in the same business, and that July 18th, 1867, they admitted plaintiff Francis into the firm, with the agreement that his interest and liability should relate back to the day the partnership was formed; and that, on the 26th of March, 1869, defendant Cornell, with the consent of the plaintiffs, retired from the firm, and the firm was dissolved; and that, at the dissolution, the firm owned a steam mill, about six hundred thousand feet of sawed lumber, eight yoke of oxen, two milk cows, and such tools as were necessary in the business;- and that plaintiffs bought defendant’s interest in all the partnership property except the sawed lumber, and gave him their note for one thousand eight hundred and fifty dollars; and that there was no other settlement of the affairs of the firm; and that, at the time, defendant owed the plaintiffs, upon partnership and ex2>ense account, six hundred and thirty-one dollars and twenty-three cents, which was left unsettled and unpaid—which sum was for advances made by plaintiffs in excess of their share; and that the firm was also indebted to various persons on account of partnership business, and that defendant left the lumber in plaintiff's’ custody, to be sold by them, and to apply the proceeds to pay firm debts, and the balance, if any, of defendant’s 2)or-tion, on his indebtedness to the firm; and that 2Dlaintiffs sold the lumber, but the proceeds failed to pay the partnership debts, and plaintiffs had paid the balance of firm debts— three hundred and fifty-eight dollars and five cents—out of their own means. Judgment was asked for one thousand twenty-two dollars and two cents, the amount alleged to be due plaintiffs. The plaintiffs recovered judgment, and defendant appealed.