Gee v. Humphries

49 S.C. 253 | S.C. | 1897

The opinion of the Court was delivered by

Mr. Justice Gary.

The facts of this case are fully stated in the decree of his Honor, Judge Earle, and as the decree will be incorporated in the report of the case, it is not necessary to state them in this opinion. Although the exceptions are quite numerous, they raise but three questions, as was said by appellant’s attorney during the argument before this Court.

1 The first question to be considered is, whether there was error on the part of the Circuit Judge in deciding that R. T. Gee is chargeable with interest on the appraised value of the stock of goods which he purchased under the proceedings in the probate court, from the time of said purchase. When Gee purchased the goods as aforesaid, he used them in his individual business; as owner • in his individual right he was entitled to all the profits; he did not expend the purchase money for the benefit of the partnership which had existed between him and Hum-phries, and it is, therefore', but equitable that he should be charged with interest. The exceptions raising this question are overruled.

2 The second question is, whether the Circuit Judge erred in refusing to charge Humphries’ estate with the accounts on the partnership books against his tenants. This Court is satisfied with the reasons stated by the Circuit Judge for so doing, and the exceptions raising this question are overruled.

3 The third question is, whether there was error in charging R. T. Gee, as administrator of Humphries’ estate, with interest on the sums paid out of Humphries’ estate in extinguishing the debt due A. J. Salinas & Sou by the partnership. The claim of A. J. Salinas & Son was against the partnership, but was secured by the personal bond of Humphries and a mortgage of his real estate. When the claim was paid out of his individual property, his estate became subrogated to the rights of A. J. Salinas & Son as against the partnership assets. Interest should be allowed on said payments. The exceptions raising this question are sustained to the extent that the Circuit Judge was in error in charging R. T. Gee, as administrator, with the whole of said interest.

4 Having reached this conclusion, it is necessary for this Court to state the manner in which the interest is to be calculated against the plaintiff. The case, shows that Gee commenced proceedings shortly after the death of Humphries to marshal the assets and for an accounting by him as administrator. The accounting between Gee and the estate of Humphries could not take place until the settlement of the partnership indebtedness, which his Honor says was on 1st January, 1887. He uses this language in his decree: “He should not be charged interest on any money received by him as survivor, or on annual balances in his hands as such survivor, until he had received enough to pay the firm debts, which, it was admitted, was on January 1, 1887; for it does not appear that prior to that time he kept unnecessarily firm money on hand and allowed firm debts to draw interest, or that he used the money for his own profit and benefit until after the said first day of January, 1887.” Interest should be calculated on the appraised value of the goods bought by R. T. Gee, as aforesaid, up to the first of January, 1887. Interest should, also,' be calculated on the sums paid in extinguishing the debt due A. J. Salinas & Son up to that date; but as the estate of Humphries became subrogated to the rights of A. J. Salinas & Son as against the partnership assets, the effect of allowing interest on the claim against the partnership assets is to make R. T. Gee chargeable, as the administrator of Humphries’ estate, with only one-half of the interest then due. The indebtedness of Humphries to the firm should then (1st January, 1887,) be deducted from the amount due his estate.

This-Court agrees with the Circuit Judge that interest should be charged on annual balances after the first of January, 1887.

It is the judgment of this Court, that the judgment of the Circuit Court be modified, in accordance with the principles herein stated.

Mr. Justice Jones concurs in the above opinion. Mr. Chiee Justice McIver.

Being unable to concur in all of the conclusions reached by Mr. Justice Gary, I propose to state briefly, without elaborating the argument, the points upon which I differ with him. 1st. It seems to me that, under the order of his Honor, Judge Witherspoon, bearing date 12th of March, 1891, to which no exception was taken, all parties were precluded from making any objection to the competency of the testimony taken by the master under previous orders in the cause. For that order distinctly declares “that the testimony taken before the master be used in the cause.” That order having been acquiesced in by all parties, is conclusive and binding upon all the parties. If it was expected or desired to raise any question as to the competency of any of the testimony so taken, it was necessary for the parties so desiring to have then raised the question as to the competency of some or all of such testimony, by insisting upon the insertion of the words, “subject to any objection as to its competency,” or some such qualifying words; and not having done so, either by noting an exception to the order or otherwise, they must now be regarded as having assented to the use of such testimony upon the reference provided for by said order. 2d. I have grave doubt's whether interest should, have been allowed one partner against the other, until the partnership debts were settled, for it was then, and then only, that it could be definitely ascertained what amount was due by one partner to the other on account of the partnership affairs. I do not mean to say that in no case should interest be charged against the survivor of a partnership on amounts received by a survivor on account of partnership assets, for there may be cases in which the survivor has been guilty of such unwarrantable delay in settling the partnership debts as would justify a charge of interest; but I see nothing in this case which would either call for or justify the application of such exceptional rule. It seems to me, therefore, that the proper mode of settlement is to charge no interest until the 1st day of January, 1887, when it seems to be agreed that all. of the partnership debts were paid, then ascertain the amount received by plaintiff, both from the partnership assets and from the estate of his deceased copartner, including therein the amount paid on the Salinas debt, from the proceeds of the sales of the deceased partner’s individual, property in excess of the amount received by the deceased partner, and let such excess bear -interest from the 1st day of January, 1887, or rather, let the amount of such excess be charged to the plaintiff in his account as administrator, to be accounted for under the rules governing such accounting.

But if I am wrong in the foregoing views, then I do not think that the plaintiff should be charged with interest, either upon the whole or one-half of the appraised value of the stock of goods taken by him at such appraised value; but if interest is to be charged at all, the interest-bearing amount should be determined by ascertaining the amount of the excess which plaintiff had, up to that time, received from the partnership assets over and above the amount which had been received by the other partner, and that such excess should be the interest-bearing amount. So, too, I do not think that the plaintiff should be charged with interest on the amount paid on the Salinas debt; but if interest is to be charged at all, it should be only upon the amount of the excess received by plaintiff over and above the amount received by the other partner, after deducting from such last mentioned amount the amount paid on the Salinas debt from the proceeds of the sale of the individual property of Humphries. But, in my judgment, as I have said above, I do not think that plaintiff is chargeable at all with interest until after the 1st of January, 1887.

I think, therefore, that the judgment of the Circuit Court, in so far as it conflicts with the foregoing views, should be reversed, and the case remanded to that Court to be determined upon the principles herein announced.

Inasmuch as the Court is equally divided as to the foregoing views, no judgment in accordance therewith can be rendered, and, therefore, I think that the judgment of the Circuit Court should, at least, be modified in accordance with the views presented by Mr. Justice Gary in his opinion,' which is concurred in by Mr. Justice Jones. Under these circumstances, the judgment of this Court is, that the judgment of the Circuit Court be modified as directed in the opinion of Mr. Justice Gary, and that the case be remanded to that Court, with instructions to carry into effect such modification.

Mr. Justice Pope concurs in the above opinion.