122 Ark. 320 | Ark. | 1916
(after stating the facts). (1) Appellant contends that the court erred in failing to adjudge him entitled to the proceeds of the sale of the horses and wagon mortgaged to secure the faithful performance of the contract and the return of all moneys received by appellees, and also in refusing to render judgment in his favor against the defendant, E. C. Hines, for the balance of the money furnished to him under the terms of the contract for carrying on the business, over the amount realized from the assets of the business upon its being wound up, and in assessing against the fund, realized from the sale of the assets, the costs of the master and receiver.
Under- the terms, of the contract and mortgage the appellee was ¡bound to the faithful performance of. the contract, and the team and wagon was mortgaged to secure ¡his faithful performance of it, and 'bound to the ■payment and accounting for all moneys received 'by Hines under the contract.
The ¡business was insolvent when it was taken possession of 'by the appellant, Myers, as shown by the books kept by Hines, which also showed that he had withdrawn from the business, as salary, about $4,000, and the assets, valued as in his own inventory made at the time Myers took possession of the business, were more than $1,000 less than the liabilities.
The court found that it was impossible to ascertain the net profits of the business, before the failure of it, from the -books kept by said appellee.
Under these circumstances we are of the opinion that the chancellor erred in holding that appellant was not entitled to the proceeds of the sale of the horses and wagon under the terms of his mortgage from appellee.
(2) Appellant’s second contention, that the court erred in not rendering judgment against the appellee, Hines, for the balance of the amount of money shown to have been advanced him, after payment ¡by the receiver of the amount realized from the assets of the business, is not well founded. The business was his own, as shown by the terms of the contract, and conducted by appellees as his agent, and the written contract provided the manner in which his advance® should ¡be repaid, and did not bind said Hines to the payment thereof except in that portion of it mortgaging the wagon and team as security for the return thereof.
(3) The third assignment, complaining of the assessment of the costs of the master and receivership against the fund realized from the sale of the assets of the business, must be sustained. The business was known to be insolvent and shown to be .so- by the ¡books, as kept by appellee, Hines, who also knew that his compensation depended upon there being net profits, and consisted of such net profits to (be determined as provided by the written contract. The insolvent business had been taken charge of by appellant, the owner of it, who was financially responsible, and not alleged to be insolvent, and there was no necessity for the appointment of a receiver to take charge of said business and deprive the owner of his property and dissipate it in expense of a master and receiver at the instance of said appellee, who had no interest in it to be protected or preserved. The payment of the expense of the master and receiver, out of the funds, was improper and unwarranted, and said master and receiver having been appointed at the instance of appellee, the cost of their compensation, should be assessed against said appellee, who improperly procured their appointment, and not against the receivership fund realized from the sale of appellant’s property, and the court erred in holding otherwise. 23 Am. & Eng. Enc. L, 1107; High on Receivers, § 809a; 34 Cyc. 368; Highley v. Deane, 168 Ill. 266; Hendrie & Bolthoff Mfg. Co. v. Parray, 86 Pac. 113; Couper v. Shirley, 75 Fed. 168; Willis v. Sharp, 12 N. Y. Supp. 120; Weston v. Watts, 45 Hun. 219.
The decree is accordingly reversed and the cause remanded with directions to enter a decree in accordance with this opinion.