120 Mass. 285 | Mass. | 1876
It appears from the bill, answers and report of the master that in April 1864 the plaintiff with the three defendants entered into a partnership to hire á store at Norfolk, Virginia, and carry on a wholesale and retail trade in such goods as would command a ready sale. Each partner was to contribute fifteen hundred dollars to the capital stock, and share equally in the profits and losses of the business. The defendant Presby was to have the control and management of the business at Norfolk, the others continuing to reside in Massachusetts, and it is to be presumed, from a settlement afterwards made between the parties, that Presby was also to be allowed for his services and expenses at Norfolk as the managing partner. There is nothing ih the papers before us to show, or from which it is to be implied, that the business thus entered upon was not perfectly legitimate and legal.
In the month of May following, and while Presby was at Norfolk, one Johnston, then acting as adjutant to the general in command, suggested to Presby that he could make money by sending goods into that part of North Carolina known as the “ neutral territory,” and exchange them for cotton, provided that the assistance of one Harney could be obtained, who was well acquainted with that part of North Carolina and competent to conduct the business. In pursuance of this suggestion, Presby met Johnston and Harney. Johnston then proposed that Presby should furnish the capital for the enterprise, that he, Johnston, should procure from the general in command the permits necesi
We cannot but regard this as a separate and distinct undertaking, wholly apart from the purposes of the original partnership, requiring not only a new advance of capital, but, from the nature of the arrangement and the division of profits to Harney and Johnston, requiring separate accounts to be kept, not necessarily connected with the original partnership accounts.
In June following the parties again met in Boston, and it was agreed that Presby should take an account of the stock of goods in the store on July 1, and purchase them at cost prices, that the company should be dissolved on that day, the undertaking abandoned, and that Presby should forward and sell all cotton then on hand. The account of stock in the store was taken by Pres-by, and he also bad on hand forty-six bales of cotton purchased by Harney in the neutral territory, under the agreement. The cotton was shipped by Presby for New York, and the ship sailed from Fortress Monroe on July 10. On July 11 it was reported in Norfolk that a cruiser of the enemy was off the capes, and Johnston and Harney, being alarmed, proposed to sell their interest in the profits to Presby, saying they should sell to some one. Presby paid Johnston $3000, and Harney $2500, for any interest they might have in the profits of the enterprise. This purchase
This bill, filed by Dunham against Presby and his two other partners, alleges the general partnership, and also that there had been a partial settlement, but that Presby had not accounted for all the partnership property in his hands, and prays for a full account and disclosure in-regard to the partnership business. The several defendants answer that there has been a full settlement, relying on the settlement of July 30, 1864. Neither bill nor answers disclose the character of the transactions in regard to the cotton: that appears for the first time in the master’s report. It is not now contended that any account connected with the original partnership in relation to the store is outstanding; the only matter at issue relates to the profits which accrued to Presby upon sale of the cotton in Boston, ■‘brough his purchase or settlement with Johnston and Harney of their interest. All other matters were adjusted July 30." As the case stands, the bill seeks only to compel a distribution among the partners of the profits in the hands of Presby, arising out of the distinct and separate agreement under which the cotton was procured.
The question at once arises upon this statement, whether this is not an attempt to enforce an illegal agreement to carry on trade and commercial intercourse within localities beyond the
Nor is it material that the defendants do not set up the illegality in their answers, as no waiver by them or consent of parties can oblige a court to determine their rights under an illegal contract. Cardoze v. Swift, 113 Mass. 250. Evans v. Richardson, 3 Meriv. 469. If the money thus received by Presby was not partnership property, in which his partners were entitled to share, of course the bill must be dismissed. If on the other hand, as contended by the plaintiff, the money so received belonged to the partnership, to be accounted for by Presby as the profits of the joint undertaking, it is clear that it can only be reached by the plaintiff through the illegal agreement by the terms of which he is entitled to receive one quarter part of the profits coming to the partnership from the unlawful enterprise. The case falls within the rule laid down in Armstrong v. Toler, 11 Wheat. 258, and Thomson v. Thomson, 7 Ves. 470, that no action can be maintained on such a contract to enforce its obligations or secure its fruits to either party. The cases bearing on this question are collected and considered in Snell v. Dwight, ante, 9. Bill dismissed.