7 Minn. 89 | Minn. | 1862
By th& Court
The Plaintiff alleges, in his complaint, that he and the Defendant own and possess, as tenants in common, certain lands in the county of Scott, together with the mills and improvements thereon; that his share or interest in said property is the equal undivided two-thirds, and that of the Defendant the undivided one-third thereof; that while said parties were using said property, and dividing the expenses and profits according to their respective interests aforesaid, the Defendant took sole possession thereof to the exclusion of the Plaintiff, and has since been in the sole receipt and enjoyment of the earnings and profits of said mills; that he, Plaintiff, has expended large sums in repairs and machinery for said mills; and that the property, cannot be divided without injury thereto. He therefore asks that the parties respectively be made to account, and that the property be sold and the proceeds appropriated m a specified manner, under the direction of the Court. He further asks, for reasons alleged, that an injunction may issue restraining the Defendant from farther intermeddling with the property, and for the appointment of a receiver.
To this the Defendant answers, admitting that the premises are held by the parties in the manner stated in the complaint, and that their interests respectively are as therein specified. He also admits the joint occupation of the mills and premises, but denies that the'expenses and profits were to be shared iu proportion to their respective interest in the mills. He denies also that he has ever taken control of the mills to the exclusion of the Plaintiff therefrom, or from a participation in the profits. He further denies that the Plaintiff has expended any moneys, or that he, 'Defendant, has received
The Defendant then sets out a contract, dated June 23, 185T, made between him and the Belle Plaine Company, for the erection and construction of said mills, and for running and operating the same after completion, which he avers that he kept on his part, but which the said company violated in certain particulars, and then alleges that he took possession of said mills under said contract, and used and occupied them until sometime in August, 1858, when disputes and differences having arisen between him and said company, they were referred to arbitrators for settlement; and that said arbitrators afterwards.awarded that he was entitled to one-third of said property ; and had the right to take possession of the mills, and operate the same under said contract of June 23, 1857.
He further alleges that said company, having become insolvent, assigned their interest in such property to D. W. In-gersoll, for the benefit of creditors, by deed dated December 31, 1858, which said deed was expressly made subject to liens and rights under existing contracts. And that said Ingersoll, on the 10th day of September, 1859, assigned or quit claimed his interest therein to the Plaintiff, in payment of a debt then due from said company to the Plaintiff; and that the Plaintiff had at the time due notice of the contract of June’ 23, 1857, and of the award made by the. arbitrators as aforesaid.
The Defendant further alleges that the Plaintiff- has sold divers portions of machinery and other property belonging to said mills, and has appropriated the proceeds thereof to his own' use. That he has taken exclusive possession of said mills and appurtenances, and ejected the Defendant therefrom, and thereupon also took possession of and appropriated a large amount of grain and other property belonging to him and the Defendant. He also alleges that said mill property, described-in the'complaint, cannct be divided without injury.
In conclusion he asks that the Plaintiff be made to account; and that the mills may be restored to him, the Defendant, and that he be allowed to operate the same under the contract of June 23, 1857.
But while the Plaintiff asks that their joint occupancy of the property should be terminated, and the property sold and the proceeds divided in proportion to their several interests, the Defendant insists on the right to continue operating the mills upon the contract of June 23,1857, and the award, and on the right to retain the Plaintiff as a partner, even without his consent.
Let us examine, somewhat, into the facts upon which the Defendant founds so extraordinary a proposition.
It appears from the report of the referee, to whom all the issues were submitted, that the Defendant and the Belle Piaine Company, by the written contract aforesaid, of June 23, 1857, agreed to construct and put in operation mills of a certain description, each party furnishing machinery, materials and money therefor, in the manner therein specified; and that after the mills should be completed, the Defendant should run and operate them on joint account, each party furnishing one-half of the funds necessary, and receiving one-half the profits — the Company, however, guaranteeing that the profits thus coming to the Defendant should equal tender cent, per annum on the ainount by him invested, exclusive of his labor.
. It further appears that under this agreement, the parties built the flouring mills provided for, and described in the complaint, but that just before they were completed, to wit, on the 19th of December, 1857, they made a new agreement in writing, by which the Defendant agreed to give to said Company the exclusive use and control of said mills, and also Ms personal services, from the date thereof until the first day of January, 1859, for the agreed sum of $1,200, payable in monthly installments of $100 each. It was also thereby agreed that the old contract, except as therein modified,
It further appears that said arbitrators afterwai’ds, on the 3d 'day of February, 1859, awarded that the interest of said parties in said flouring mill, was as follows, to wit: that of said Company was $16,000, and that of the Defendant was $8,000. And that their interests in the other property were in the same proportion. They also found and awarded that the parties were restored to -their rights respectively under the contract of June 23,1857, and that the'Defendant should go into possession of the mills under said contract, according to his interest, as in said award provided. And they further found and awarded that the accounts, claims and demands of the parties respectively were mutually balanced; that each should execute to the other a full and sufficient release of all claims, demands, rights and damages, of every kind and description'; and that said award should be a final and full settlement between the parties. And they also provided that either party might apply for the appointment of a receiver.
It further appears from the report of the referee, that before the expiration of the contract of lease, dated December 19, 1857, to wit, on the 31st day of December, 1858, the said Company, being insolvent, assigned all their interest in said property to D. W. Ingersoll, for the benfit of creditors, subject, however, to all liens thereon, and to the rights of parties under existing contracts. That said Ingersoll and the Defendant afterwards, on the 8th day of March, 1859, made a written agreement, reciting their respective interests in. the prop
It further appears that said Ingersoll afterwards, on the 10th of September, 1859, assigned all of his interest in said property to the Plaintiff, in payment of a debt due to the Plaintiff from said Company ; and that the Plaintiff thereupon entered into possession with the Defendant, and thereafter operated the said mills with the Defendant jointly, sharing the expenses and profits in proportion to their respective interests in the •mills, etc., until the 18th day of January, 1860, [about the date of the commencement of this action], when he took sole possession of the mills and excluded the Defendant therefrom.
The referee also finds that, at the time the Plaintiff purchased said property of said Ingersoll, he had notice of said contract of June 23, 1857, and of said award of February 3, 1859. He also states the account, between the Plaintiff and Defendant, since the Plaintiff acquired an interest in said mills, including all expenses, receipts and profits, and the value of the Defendant’s labor, and of the property sold or appropriated by either party; and finds that the Plaintiff is indebted thereon to the Defendant in the sum of $666.24.
These are in substance the material facts found by the referee.
As conclusions of law he finds: That the award of February 3, 1859, was binding upon the parties thereto and their assigns;—
That the same was a full settlement of all claims for damages, by either party, arising under the agreements of June 23,1857, and December 19,1857, and that said Belle Plaine Company were thereby released from all further obligation under said contracts, to erect and put in operation the other mills or machinery mentioned in the original contract, but not yet erected; — •
That the interest of the Plaintiff is free and clear of all rights or equities of the Defendant, under the contract of June 23, 1857 ;—
That the Defendant’s interest in the property is not permanently fixed at $S,000, nor is he entitled on a partition to that sum, with interest at ten per cent, per annum from the date of the award ;—
That the Defendant is not entitled to the exclusive control of the mills, nor to one-half the profits thereof;—
And that the property described in the complaint should be sold, etc.
Upon the filing of this report, the Court adjudged that the property be sold by a referee appointed for the purpose, and the proceeds of the sale brought into Court; and thereupon the Defendant appealed from said judgment.
We have perused again and again the voluminous record sent up in this case, and have carefully examined the multitude of points made by the Defendant, but without being able to find anything of which he ought Seriously to complain.
We cannot-agree with him in the position that the contract of June 23, 1857, made him and the Belle Plaine Company partners in the mills themselves ; although it provided for a partnership in running them after they were completed. The real estate was not purchased nor were the mills built with partnership funds; nor were either ever used, by the parties to the original contract, for partnership purposes. But even had they, been thus used, they would not be considered as having lost their character as real estate, unless there was an agreement to that effect, or it became necessary so to regard them for "the protection of creditors. The erection and construction of the mills was the main object of the contract, and were preliminary to and quite distinct from the business of operating them afterwards. And so we think the parties themselves considered it; for we find that before the mills
But again, the contemplated partnership as to Twining the mills was never consummated; for before the expiration of the contract of December 19, 1857, (by which it was postponed to January 1, 1859,) the Company made an assignment for the benefit of creditors; and this of itself put a stop upon the future partnership of the parties in operating the mills; and would also have worked a dissolution of any partnership as to the real estate, had any such really existed. Bissett on Law of Partnership, 84, and cases cited. It is plain, therefore, (all partnership between the Defendant and the Bede Plaine Company being dissolved at this time), that the Defendant can enforce no rights, against the successor in interest, or assignee of said Company, that could not be enforced against the Company itself; and we find, by reference to the report, that by the award of the arbitrators, (which the Defendant insists shall be enforced), the accounts, claims and demands of the parties of every kind and description were mutually balanced and settled.
Up to the time of the award, then, the Defendant had no unsettled claim or equities against the Company.
But, says the Defendant, the original contract, by the terms of the award, remained in full force, and I am entitled to damages for the neglect of the Company to comply with its terms since the award. We hold, with the referee, that said Company was released by this settlement from all obligation to erect the saw mill, and other machinery specified in said contract of June 23, 1857, just as they would have been re
But let us suppose that the Defendant had this right under the award ; and still it does not follow that it can continue forever; nor that any damage which he may sustain by reason of the Company refusing to proceed under it, can be made a lien upon the premises belonging to the individual partners 'as tenants in common. The effect of the award is to ascertain and fix the interest of each in the mills and other property; but it does not find that the mills were partnership property, nor built with partnership funds, nor used for partnership purposes, nor any fact, indeed, from which a partnership therein could be legally inferred for any puipose. The legal conclusion, therefore, is that the Defendant and the Belle Plaine Company were tenants in common of the property mentioned in the award. And as nothing was due from either party to the other, at the date of the award, it follows
But again, the interest of the Belle Plaine Company was in fact assigned more than a month before the date of the award; consequently the assignee’s title accrued prior to the time when the Defendant dates his damages, unless he' be permitted to go behind the settlement made by the arbitrators; but this we have endeavored to show cannot be allowed.
Plow, then, does the matter stand in relation to the dealings of the Defendant with the Company’s immediate assignee, Mr. Ingersoll ?
The Defendant does not claim that anything is due to him from Ingersoll on the agreement of March 8th, 1859. This agreement recognizes and adopts the award before mentioned, and is a contract for a partnership in running the mills. It was without limitation as to time, and therefore either party was at liberty to terminate the partnership at pleasure. And however much one partner may have become indebted to the other, there would be no lien therefor on the mills; for they were not partnership property; nor could the claim of any purchaser be prejudiced thereby, unless, perhaps, the purchase was made in violation of the statute of frauds.
We next come to the transactions between the Plaintiff himself and the Defendant; and of these the referee makes a very full report, finding a balance due to the Defendant, on a statement of all the accounts between them, and directing that it be paid out of the proceeds of the -sale of the mills. But as this is beneficial to the Defendant, we cannot see that he has just cause of complaint as to this particular finding.
We have thus endeavored to trace the claim of the Defendant for damages through its various stages, and have
We have been at somewhat of a loss to know what there is in the judgment appealed from, of which the Defendant complains. He admits the-interest of the Plaintiff, asset forth in the complaint, and also that the property cannot be partitioned, without injury to the owners ; and, as it is evident that the parties cannot further satisfactorily conduct the business on partnership or joint account, there cannot be reasonable ground for objecting to the sale of the property, and division of the proceeds according to the respective rights of the parties. And this in fact is all that is effected by the judgment. The property is simply ordered to be sold and the proceeds brought into Court, to be afterwards distributed according to the equities of those interested therein. The decree does not, as yet, determine what these respective interests are.
We have, however, carefully examined and considered each of the Defendant’s thirty-five elaboratly prepared points ; but cannot take them up in detail. With the exception of the first two, which are directed to mere questions of practice,
That the Belle Plaine Company and the Defendant were partners in the building of the mills, etc., under the contract of June 23, 1857.
That the real property described in the complaint was partnership property, and should be treated in this action as personalty.
That the Defendant has a claim for damages against his co-partners, the Belle Plaine Company, arising out of their failure to erect a saw mill and other improvements, contemplated by his contract with them, which claim is alien upon all partnership property.
That said contract, and the award thereon, are binding upon the assignee of the said Belle Plaine Company; and that the assignee or his successor in interest is bound to carry out the said contract and award.
That by the terms of said award, the said contract of June 23, 1857, was in full force, and the interest of the Defendant was fixed at $8000.
That by the terms of said contract the Defendant is entitled to the exclusive possession of the mills, and to run them on joint account for half the profits, which are guaranteed to be equal to ten per cent, per annum of his investment.
That the Defendant therefore is entitled to the exclusive possession of the mills, and to operate them under the contract ad infinitum, whether the Plaintiff consent or not.
And that in the event of a sale of the property, the Defendant is entitled, out of the proceeds, to the amount of his interest as fixed by said award, to wit, $8,000, and interest thereon at the rate of ten per cent, per annum.
The most of these propositions have already been commented upon above, wherein we endeavored to show, — that the Defendant and the Belle 'Plaine Company were not in partnership in regard to the mills.or real estate on which they are located, and therefore that said mills could not be treated as personal property; also, that whatever claims for damages the Defendant had prior to the assignment of said Company
If we have been successful in these efforts, the foundation upon which the Defendant has built nearly his whole defence, is substantially removed.
It will scarcely be necessary to say anything further of such of the Defendant’s points as are based upon the assumption, that the contract of June 23, 1857, created a partnership between the parties thereto, which was so far indissoluble that an assignee of the Belle Plaine Company’s interest in the mills, can enjoy that interest onl-y upon the cónditions of completing all the structures provided tor by said contract, and of continuing the Defendant, as a partner in operating said mills upon the terms originally agreed upon, so long as he might desire to remain a partner in such business. And as to the Defendant’s other proposition, that he is entitled first to receive out of the proceeds ot the'mills, if directed to be sold, the amount at which his interest was fixed by the award of the arbitrators, to wit, $8,000, with interest thereon at ten per cent, per annum, it is sufficient to say that he has no equitable claim to such a preference. The arbitrators doubtless estimated the value of the respective interests- of the parties in dollars an'd cents, for the sole purpose of enabling them to determine the amount invested by the Defendant, so that in the event that the mills were operated thereafter under the old contract, the Defendant’s, share of the profits, (which it will be remembered was to equal ten per cent, per annum on the amount by him invested) could be readily ascertained. We have seen, however, that the parties never -operated the mills under said contract; the Belle Plaine Company having dissolved all connection with the mills, and with the Defendant, whether as partner or otherwise, by their assignment to In-
Judgment affirmed.