Day v. Lockwood

Waite, C. J.

Upon examining the copies furnished us, in the present cases, we find that the proceedings have been in some respects irregular, informal, and perhaps defective. But we have not felt ourselves called upon to notice those proceedings, any further, than is necessary, to enable us to dispose of the several questions, which- have been made and discussed before us, by the parties. • Our opinion therefore must be considered as having reference to those questions, and nothing further.

1. The first question made, in reference to the ease of Day against Lockwood, is, that the auditors erred in taking into their account the proceeds of the plaintiff’s farm, during the second year, when that year had not expired, at the time when the suit was commenced. This objection, in our opinion, would have been a valid one, had it been taken at the right stage of the proceedings.

The declaration charges the defendant with having been the bailiff and receiver of the plaintiff, from April 1, 1851, to January 1,1853, and accountable as such, for the produce of the plaintiff’s farm during that time. Whether he was such *194 bailiff or not, was a question, not for the auditors, but for the court, to be tried upon a proper plea, presenting that issue, before the cause was sent to auditors, to take the account.

If, indeed, the defendant had simply pleaded that he was never the bailiff of the plaintiff, that issue must have been found against him, if at any time during the period specified in the declaration, he was such bailiff.

But we see no difficulty in so framing the plea as to present fhe issue, whether, under the circumstances, he was accountable for the use of the farm during the second year, so as to have that question determined before the cause was . sent to auditors.

This court held, in one case, where the plaintiff sued for an injury done to her mill during a period of six years, and it appeared, that during three of those years, she was a tenant in common with another; that, as the defendant had omitted to plead on the joinder of the other co-tenant, the plaintiff might recover all the damages she had sustained during the six years. Branch v. Doane, 17 Conn. R., 402.

Had the defendant, before the auditors, introduced evidence to prove that he was never bailiff, or that he had fully accounted, it would have been their duty, notwithstanding, to have taken the account upon the ground that such defence came too late. The same rule, in our opinion, applies to the defence made before the auditors in the present case. A matter, which might have been pleaded in bar, can not afterward be pleaded before auditors. Com. Dig., Aecompt. E. 11. 3 Wilson, 73 -113. Usher v. Spencer, 2 Day, 116 .

The precise quéstion before them, is whether the plaintiff or defendant is in arrear. Lacon v. Davenport, 16 Conn. R., 345.

But it is said that the auditors have not only taken the account for the time specified in the declaration, but up to the end of the second year, some three months afterward. If by this we are to understand that they have embraced in their report anything, which was not a part of the joint *195 property during that period, or the produce of such joint property, they have undoubtedly erred.

The rule seems to be well settled, that in this action, the account may be taken up to the time of making the award and this upon the principle of doing justice to the parties. Robinson v. Bland, 2 Burr, 1,086. Smith v. Brush, 11 Conn. R., 359. Holabird v. Burr, 17 Conn. R., 556.

Thus, in the present case, the plaintiff was charged, and rightfully too, with the potatoes and oats, the common property, which he attached in his suit, and afterward sold. It would have been manifestly unjust to award him the whole amount due, when the suit was commenced, and allowed him to retain the” proceeds of that property in addition. They were properly applied in reduction of his claim.

But in a chancery suit, this court has gone still further, and sanctioned the admission of evidence, to show that, after the account had been taken by a committee, and before a final decree, the state of the accounts had been varied. Kendall v. New England Carpet Co., 13 Conn. R., 383.

• In the present case, the use of the farm, for the term for which it was leased, and the produce of it, constituted the partnership property. The appropriation of any portion of it, by one partner, to his own use, rendered him accountable for it, to the other partner. And it makes no difference, whether the property thus converted, was gathered from the farm before, or after, the suit was commenced, provided, at the time of the conversion, it was common property, holden as such under the agreement upon which the suit was founded.

If two persons are joint owners of a ship, or a mill, and one of them, after a suit has been commenced for an account, receives freight or tolls earned by their common property, we see not why he should not be accountable for them, whether they were earned before, or after, the suit was commenced.

If indeed they were to purchase another ship, not with their joint funds, after suit brought, the case would be differ *196 ent, however comprehensive the allegations in.the declaration might be; so, in the present case, had Lockwood continued in possession of the farm for a third year, under circumstances showing that it was under a new agreement, although of the same kind, and upon the same terms as the former, he would not be accountable, in the present suit, for the produce on the farm, during that year.

But for another reason, we think this objection ought not to prevail. Although it is alleged in the remonstrance, thát the account was taken for the whole year, it does not necessarily follow that it embraced any items of property, gathered from the farm during the last three months of that year. And, practically, we know that during these months very little if anything could be so gathered.

To justify us, in setting aside the report for this cause, we think the objection ought to have been more definitely made, showing clearly that the defendant was prejudiced by the decision of the auditors.

In the case.of Lockwood, against Day, it is in the first place urged that the auditors erred in allowing Day the full amount of the Pritchard note, as capital stock advanced by him.

What amount of capital was paid in, by the partners, was a question of fact for the determination of the auditors, depending upon the understanding and agreement of the partners. They might have agreed that the. note should be received at its full amount, or only for the. sum of two thousand dollars, or only for so much as might thereafter be collected upon it.

The court below has found that the note was received at the amount specified in it, because the auditors found, as a matter of fact, that such was the understanding and agreement of the parties. Surely there can be nothing erroneous in that.'

Again it is said, that Day had stated, in the declaration in his suit, that he had put in two thousand dollars, and never, *197 previous to the hearing before the auditors,- had he claimed that he had advanced more.

These facts were' undoubtedly -proper evidence in support Of Lockwood’s claim that Day-had advanced but two thousand dollars; but they were only evidence to be weighed and considered, with other evidence in the case. Day might have shown, and probably did show,, that the allegation in his declaration, was inserted by mistake, in reference to the amount. It did not amount to an e.stoppel, and as testimony in the case might be rebutted by other evidence.

But the auditors did not' allow Lockwood the expenses incurred by him in the collection of the note, and the deduction made upon the final settlement.- And there is a sufficient reason for their so -doing. - He failed to establish his claims to the satisfaction of the auditors. Surely they were not bound to allow claims, not sufficiently supported by evidence.

2. The claim, respecting the money and accounts in the ■hands of Griffith, is equally groundless. Why should Day be charged with them, any more than Lockwood 1 The accounts were placed in Griffith’s hands for collection, by the mutual consent of both parties.

The payments, made by him to Day, were proper, because the report of the auditors shows that Lockwood had already received more of the partnership property, than his share.

The direction given by Day to Griffith to suspend the collection of the accounts, while the auditors were investigating the concerns of the partnership, was not such an act as rendered him chargeable for any loss that might afterward accrue.

Whether an action at law will lie to settle a partnership concern, while there are outstanding debts uncollected, and common property remaining undisposed of, is a question we do not propose to consider, for the reason already stated, that neither party has thought proper to present any such question for our consideration; and if either had, it was a *198 question not for the auditors, but for the court, before the cause was sent to them.

It is obvious, however, that it is in the power of a court of equity, under such circumstances, to do more complete justice to the parties than can be done in an action at law. That court might, by its decree, direct what disposition should be made of the common property, and provide for the collection of outstanding debts, in a manner that could not be done in a court of law. In the present case, however, the common property must remain to be hereafter disposed of, in such manner as the parties may think proper to adopt.

It will hardly do for Lockwood to bring an action at law for the settlement of a partnership concern, before the business has been closed, and after the cause has been referred to auditors, and a balance found against him, then say that no judgment can be rendered against him, because the suit was prematurely brought. His conduct amounts to a waiver of that objection.

The remaining question is attended with more difficulty. The auditors have not only allowed Day the amount which he claimed to have put in as capital stock, but the interest upon it. His right to such interest depends entirely upon the understanding and agreement of the partners; and without any such understanding, the charge of interest was illegal.

It was competent for the parties to agree that interest should be allowed upon the sums advanced by each partner as capital, or that, in consequence of the superior skill of one partner, or his greater attention to business, the other should put in a greater amount of capital, and that the profits should be equally divided. In the latter case, no interest ought to be allowed.

In the present ease, it does not sufficiently appear that there was any understanding, or agreement, of the parties, that Day should be allowed interest upon his part of the *199 capital, and therefore the allowance of interest does not appear to have been rightfully made.

Our advice to the superior court, therefore, is, that the report of the auditors, in the case of Day against Lockwood, be accepted, and that the report, in the case of Lockwood against Day, be recommitted to the auditors, for them to find whether, in fact, there was an agreement that interest should be allowed upon the capital stock invested, and that, if they do not find such agreement, they correct their report, by the disallowance of interest thereon.

In this opinion, the other judges, Storrs and Hinman, concurred.