105 Ky. 694 | Ky. Ct. App. | 1899
delivered the opinion of the court.
On the former appeal, 17 Ky. Law Rep., 194, [28 S. W., 774], it was adjudged that the appellant, Thomas, was a member of the firm of M. H. Clay & Co.; so that question is behind us. The appellee, supposing that M. H. Clay was the owner of the property which turned out to belong to the firm of M. H. Clay & Co., sued him and sought to subject property of the firm to the payment of an individual debt which it held against him. Clay was the managing partner; the appellant, Thomas, giving but little attention to the partnership affairs.
This partnership must be settled as if the suit was pending between Thomas and Clay. The bank
Thomas’ net contribution to the firm capital was $6,889.31. Before the transaction took place to which we will hereafter refer, Clay had contributed but a small sum, comparatively, to the firm- capital. It appears that he forged the names of his grandfather and father te notes, had them discounted at banks, and in that way realized about $61,000. This sum he deposited in banks to the credit of the firm of M. H. Clay & Có. Thomas was not aware of this fact. It was not entered upon the firm books in which the partnership accounts were kept, but seems to have been placed upon the pass books of the banks which he used. This was put in the name of the firm, evidently, for the purpose of covering up his fraudulent and dishonest transactions, and not as a contribution to the firm’s capital. Thomas was -able to show that about $37,000 of this sum was not used by Clay for the benefit of the partnership business, and the testimony in the record is not satisfactory that the balance of the $61,000 was used and went -finally to the benefit of the partnership..
It appears in this record that there is no way to know what Clay spent for individual purposes or for firm purposes. There is no evidence in the record that any loss had been sustained in the conduct of the business, but it appears from the testimony that Clay spent several thousand dollars in gambling. Estimating the tangible property at its
Whilst the court has a serious doubt as to whether Clay should be credited with $21,000 as his net contribution to the firm capital, wé have concluded, under all the circumstances in the case, that, after the payment of the
Counsel for appellee has cited no case to follow which
We think the conclusion is supported by Wolf v. Levi, 17 Ky. Law Rep., 1024, [33 S. W., 418]. In that case it appeared that certain members of the partnership, pending the litigation for the settlement of accounts, borrowed money on their individual credit for the purpose of paying partnership debts which were falling due, and the court adjudged they were entitled to be reimbursed the interest which they paid. In this case, Thomas had no assets of the firm in his hands, as they had been seized by an individual creditor of Clay. He expended his own money for the purpose of meeting partnership' obligations, and we perceive no just and equitable reason why he should not be allowed the sums thus expended, with interest thereon. The commissioner .charged it, and the court so adjudged interest on the fund in the hands of the appellee arising from the assets of the partnership. Thomas had been deprived of the use of it for the purpose of meeting the obligations of the concern, and the appellee has enjoyed it, and we think it but just and right that it should account for interest on the fund.
The rule announced in Moon and Taylor v. Story, 8 Dana, 226, and Lee v. Lashbrooke, Id., 214, supports the view expressed.
There are some other questions raised in the case, but we have reached the conclusion that the court below did not err in passing upon them.
The judgment is reversed on original, and affirmed on cross-appeal, and for proceedings consistent with this opinion.