143 Mo. 652 | Mo. | 1898
This is a proceeding in equity by which it is sought to charge the partnership estate of S. H. Merten & Company with a lien amounting to $3,000 and interest, alleged to have been plaintiff’s money, and to have been converted by said company.
The firm of S. H. Merten & Company was composed of Stephen H. Merten, John F. Haekmann and William Haekmann. The firm did a general milling business for about twenty years in the city of St. Charles, and was dissolved by the death of John F. Haekmann on the eighteenth day of September, 1893. On the twenty-seventh of September, 1893, the defendant, Henry J. Schoeneich, took out letters of administration on the partnership estate, and two days thereafter took out letters of administration on the individual estate of said John F. Haekmann. The partnership estate proved to be insolvent, paying not more than twenty-five cents on the dollar of its indebtedness. Both Stephen H. Merten and William Hackmann are insolvent; John F. Haekmann died insolvent. The plaintiff is a corporation duly incorporated under the laws of Missouri. Ever since 1887, one Rev. Rein-hard Wobus who had charge of a congregation of the Evangelical Church at St. Charles, Missouri, was the treasurer of said synod up to the time of his death,
Without the knowledge or consent of the president or other executive officers of the G-erman Evangelical Synod of North America, Mr. Wobus, on November 13, 1893, went before the probate court of St. Charles county, and had said $3,000 allowed in his own name, against the partnership estate of Stephen H. Merten & Company, and $300 in offset. Nothing was ever paid on this allowance and as soon as the-president of the synod learned of it he denied that the synod had'anything to do with it, and that Wobus had any authority to act for it in respect to said
I. During the trial plaintiff read in evidence over the objection and exception of defendant the ex parte affidavit of S. H. Merten and William Hack-man, with respect to the transactions out of which this litigation arose, in which it was stated in substance among other things that Mr. Wobus never advanced or loaned any of the moneys in question to the firm of S. H. Merten & Company but that said firm always deposited said moneys as requested by him, in the Union Savings Bank, until during the few last months, when said moneys were used in the business of said firm, without his knowledge or consent, so that the firm of S. H. Merten & Company is now indebted to him for such money left for deposit and belonging to the Evangelical Synod of North America, in the sum of $3,000, and in this ruling it is insisted by defendant that error was committed. When the objection was interposed to the admission in evidence of this affidavit the court admitted it in evidence accompanied by the remark that it would consider the objection afterward, but never ruled upon it, and it is now contended by plaintiff, that as defendant brought out the same facts contained in the admission by his own witnesses, this court can not ascertain from the record whether the trial court admitted or rejected this evidence. But this position seems to us to be untenable, for the'reason that the logical effect of the
There was, however, other evidence as to the transactions between Wobus and S. H. Merten & Company, upon which to predicate and justify the finding of the court, and in such circumstance the case being one in equity, the incompetent evidence admitted on the trial can be disregarded by the appellate court, so that the admission of the affidavits in evidence although improper is not reversible error.
No member of a copartnership after its dissolution can by any act or admission of his bind the firm of which he was a member, except it be otherwise agreed by the articles of association or of dissolution. 1 Greenl. Ev. [15 Ed.], sec. 112; Story on Part., secs. 107, 323; Brady v. Hill, 1 Mo. 315; Little v. Ferguson, 11 Mo. 598; Flowers v. Helm, 29 Mo. 324; Dowzelot v. Rawlings, 58 Mo. 75. The affidavit being ex parte was nothing more than a mere voluntary statement and we think cleaiiy inadmissible in evidence.
II. It is next contended by defendant that the relation between Wobus, or the plaintiff, and S. H. Merten & Company was that of -creditor and debtor, general depositor and depositary, and not of cestui que trust and trustees, or special depositors and depositary. Upon the other hand plaintiff claims that the relation between the plaintiff and S. H. Merten & Company was that of cestui que trust and trustee. There can be no question under the facts disclosed by the record but that Wobus received and held the moneys and the checks upon which the funds in question were collected, as trustee for the plaintiff, and not otherwise.
The general rule is, where trust funds have been so mingled with other funds of the trustee or agent, or with his bailee or depositary, and have not been invested in specific property so that it can be traced, the cestui que trust loses his lien, and can only come in and share with the general creditors of the insolvent estate which wrongfully converted the funds. The rule announced in Little v. Chadwick, 151 Mass. 109, is as follows: “When trust money becomes so mixed up with the trustee’s individual funds that it is impossible to trace and identify it as entering into some specific property, the trust ceases. The court will go as far as it can in thus tracing and following trust money; but when, as a matter of fact, it can not be traced, the equitable right of the cestui que trust to follow it fails. Under such circumstances, if the trustee has become bankrupt, the court can not say that the trust money is to be found somewhere in the general estate of the trustee that still remains; he may have lost it with property of his own; and in such a case the cestui que trust can only come in and share with the general creditors.” Johnson v. Ames, 11 Pick. 173, 181, 182; Le Breton v. Peirce, 2 Allen, 8, 13; Andrews v. Bank of
In the case at bar there is no such thing as tracing the money deposited by Wobus with S. H. Merten & Company, into any particular property, nor was it
But the modern doctrine, and especially the adjudications by the appellate courts of this State go farther, and hold that when a trustee or bailee wrongfully mixes trust money with his own, so that it can not be distinguished what particular part is trust money and what part is private money, equity will follow the money by taking out of the insolvent estate the amount due the cestui que trust, although it can not be identified or separated from other funds with which it was mixed. In Harrison v. Smith, 83 Mo, 210, a bank in this State undertook to make a loan of money on real estate security here for a party who resided in the State of New York, and kept a bank account there, and the plaintiff sent the bank making the loan a check for the sum to be loaned, payable to it, which was to be paid to the borrower when the terms of the loan were complied with. The bank credited the amount received to plaintiff and sent the cheek to its correspondent in New York by whom it was collected and credited to the bank here, and in the meantime the latter led the plaintiff to believe that the loan had been perfected, and thereafter made an assignment for the benefit of its creditors. And it was held that the relation of trustee and cestui que trust, and not that of depositor and depositary, existed between the bank and plaintiff. And that when a trustee mixes trust money with his own so that it can not be distinguished what particular part is trust money and what part is private
Our conclusion is that whatever the rule may be elsewhere, under the law as declared by the appellate courts of this State plaintiff was entitled under the facts disclosed by the record to have the firm assets charged with the amount of the converted fund as a preferred demand, and that the court below correctly so held. '
III. Nor is plaintiff under the facts, bound by the judgment of the probate court on the demand presented by, and allow in the -name of its agent Wobus against the partnership estate. In presenting the claim for allowance against the estate, he acted without authority from plaintiff, which at no time approved or
Finding no reversible error in the record-the judgment is affirmed.