153 Iowa 411 | Iowa | 1911
The plaintiff brought a suit upon a note for $1,600, dated January 16, 1909. The defendants admitted the execution of the note, but averred there was a mistake, in the amount thereof. They also set up a written
The parties had formed their partnership about one year prior to the date of dissolution. They had all formerly lived at Sioux Center. They organized the partnership for the purpose of becoming successors in business to one Scott. Théy purchased his building for $10,000. Of this sum they paid $4,000 in cash and gave their note for $6,000. The agreement between the partners was that the capital should be $9,000, of which each should contribute one-third. None of them ever did pay the full amount so agreed upon. The amount actually paid by each one was as follows: Slob, $2,100; De Mots, $2,635; IToeven, $2,700. During the course of the year they drew out funds as follows: De Mots, $255.80; Slob, $477.34; IToeven, $804.33. In the negotiations for the sale or dissolution, four days were consumed in making a complete invoice of the assets of the firm. This was done principally by Slob and Hoeven. As a result of such invoice, a certain statement of items and figures was made out by Slob and TIoeven, and which is known in this record as “Exhibit 6,” and is as follows:
Dr. Or. ■
Dee. 31. Owe Michigan Buggy Co. $1,592 95
Less 15-5-2 percent..... 332 36
Net................. 1,260 59
Dec. 31. 'Interest on $6,000 at .6-.percent............ 36000
Dec. 31. Taxes . .'............. ' 90 20
Dec. 31. Commission to Biter Imp. Co................ 20 00
Dee. 31. Commission due us outstanding ........... $ 712 56
Dee. 31. J. W. Koontz, as per ledger............. 180 84
Dec. 31. A. J. Valiquette for Concord ................ 75 00
Book Acct............ 272 20
Warehouse storage ..... 200 00
Trip to factory........ 76 05
One Banner buggy on hand.............. 23 05
Bryan & Nelson, Com. .. 8 17
Freight on three cars buggies on hand...... 300 00
Team............... 475 00
Dray................’ 185 00
Harness, blankets...... 55 00
Mimeograph.........' 30 00
Carpets.............. 40 00
Sample room.......... 992 75
Ledger, stationery and office supplies......... 30 00
Grips............... 15 00
Cash and cheek book. ... 149 75
J. Hoeven, interest on money ............ 135 00
De Mots, interest on money ............ 131 70
A. Slob, interest on money ............ 105 00
Slob, to equal salary of Hoeven............ 327 09
Depreciation on building 500 00
$3,820 27 $3,504 05
Hoeven, gain.......... 105 44
De Mots, gain......... 105 44
Slob, gain ............ 105 44
The following Exhibit 8 is a correct statement of the resources and liabilities of the firm on the date of the dissolution :
Resources.
Building............ $10,000 00
Commissions due, outstanding. .. 712 56
J. W. Koontz, as per ledger. . . . 180 84
A. J. Yaliquette ............. 75 00
Book accounts ............... 272 20
Warehouse storage............ 200 00
Trip to factory .............. 76 05
One Banner buggy on hand..... 23 05
Bryan & Nelson, Com......... 8 17
Freight on 3 cars buggies on hand 300 00
Team...................... 475 00
Dray...................... 185 00
Harness, blankets ............ 55 00
Mimeograph................ 30 00
Carpets.................... 40 00
Sample room ................ 992 75
Ledger, stationery and office supplies .................... 30 00
Grips...................... 15 00
Cash and check book.......... 149 75
Accounts—
Gerrit De Mots... .$275 80
Albert Slob ....... 477 34
J. Hoeven ....... 804 33 1,557 47
Total resources $15,377 74
M. Buggy Co................ $ 1,260 59
Due ou building ............. 6,000 00-
Interest, 6 percent on $6,000.00 360 00
Taxes ..................... 90 20
Commission to Riter Imp. Co... . 20 00
Capital—
Gferrit De Mots.. .$2,635 00
Albert Slob..... 2,100 00
J. Hoeven...... 2,700 00 7,435 00
Depreciation of building....... 500 00
Total liabilities $15,665 79
Loss.................... $ 288 05
There is no contradiction nor inconsistency between the items of assets and liabilities of the two statements. The fundamental difference between them is that Exhibit 6 was not a complete statement of assets and liabilities, in that it failed to include the $10,000 building among the assets and failed to include the $'6,000 debt and the capital paid in among the liabilities. The effect of Exhibit 6 was to show an apparently large undivided profit. This profit purports to be applied to an equalization of the amounts drawn out by the respective partners. $574.47 is applied to the credit of De Mots and $327.09 to the credit of Slob “to' equal salary of Hoeven.” In lilte. manner certain amounts were applied to the credit of each partner as interest in proportion to the capital paid in. The computation thus made purports to show a further net gain to each partner of $105.44. The amount agreed to be paid to the plaintiff was made up as follows:
Capital paid in .......................... $2,100 00
Interest thereon .......................... 105 00
“To equal salary of Hoeven”................ 327 09
One-third net gain .......................... 105 44
Total $2,637 53
The written contract entered into named the sum without stating any basis of computation. The plaintiff is entitled to stand upon it and to prevail unless the defendants have made a clear case.
There are a few details in the circumstances surrounding the transaction which throw considerable light upon the question. The defendants became somewhat dissatisfied with the plaintiff on the alleged ground that he was spending much time at his home in Sioux Center instead of at their place of business. On January Jth preceding the dissolution, they wrote him a somewhat peremptory letter, wherein they notified him that they had “decided to dissolve,” and that “you can either buy or sell,” and “we want you here not later than Monday to settle up.” To this letter the plaintiff replied somewhat sharply on January 8th. On January 11th he made further reply thereto as follows:
Gerrit De Mots and Jacob Hoeven, Sioux City, Iowa.— Gentlemen: With further reference to your letter under
When the plaintiff arrived at the firm’s place of business, he was requested by his partners to name a lump sum. He declined to do so and insisted upon an invoice. Four days were spent by him and Hoeven in the taking of such invoice. He testified that he fixed upon the amount upon the basis of the invoice, and that such amount included the items which we have heretofore indicated. The specific form of the amount as to dollars and cents tends to indicate that it was the result 'of computation of specific items. The letter of January 11th, which we have already quoted, purports to be an election on his part to sell upon invoice. His conduct afterwards was consistent with the purpose expressed in this letter. On the day of the dissolution and after the completion of the transaction, he discovered an item of $3 in his own favor which had been overlooked. He made claim therefor to the defendants on the theory that it was an item overlooked. They recognized it as such and paid it. On the next day the defendants discovered the alleged mistake now complained of. They telephoned to him at once. It is undisputed that he said at that time, in substance, that if there was a mistake in the computation he would make it right. The only qualification which he attempts in his own testimony at this point is that he said that, ‘if there was a mutual mistake in computing the figures which covered the amount for which I sold out, then I would make it right.’
We are convinced that both plaintiff and defendants understood that the amount to be paid to plaintiff was to be determined by computation from the invoice, and that the amount fixed upon was the result of mutual mistake. We think also that the defendants have proved such fact by that clear quantum of evidence which is required in order to justify the relief asked. That the plaintiff so understood it is indicated by his letter already referred to, by his in
It is our conclusion that the relief prayed by defendants should be granted to the extent that the contract and note should be reformed as to the amount to be paid by the defendants. Exhibit 8, already referred to, presents a proper basis of computation. The case may be remanded for final decree with leave, however, to either party to present a computation and move for a decree here.
The judgment of the trial court is, accordingly, reversed.