Christian & Craft Grocery Co. v. Hill , 122 Ala. 490 ( 1898 )

SHARPE, J.

— This bill Avas filed for the settlement of a partnership AA’hich had existed betAveen the complainants collectively as one party and the defendant- corporation as the other party. Certain undisputed facts aplicar in the record and among them are these: The partnership aa'Us to continue for tAvo months and its purpose as stated in their Avritten agreement Avas: “1st. To charter the steamship Jaederen, and have her ply betAveen Mobile and such ports in Honduras as may be determined upon. 2nd. To engage in the purchase of tropical fruits and the selling of the same.” Complainants Avere to contribute half the necessary capital, and to share half the profits or losses, and defendant -was to contribute and share in the like proportion.

On the- same day the partnership was formed it procured an agreement with the Burchard Honduras Fruit Company that the latter should act as the firm’s agents at Port Burchard, Honduras, and should also supply fruit there at agreed prices for the firm to import. Also on the same day goods amounting to $1.,026.28 were charged on defendant’s books to the Burchard Honduras Fruit Company, and the goods were shipped on the Jaederen to the address of that concern in Honduras. In making that agreement to supply fruits the Burchard Honduras Fruit Company was represented by complainants, who also bought the goods from defendant either on the credit of that company or on their own credit.

Three cargoes of fruit Avere brought by the Jaederen during the two months of the partnership’s existence, and their proceeds Avere collected by defendant. A shortage in quantity in one of the cargoes Avas reported by the selling agents at Mobile.

The result of the Arenture was a loss to the partnership, but notwithstanding the loss a balance remained in defendant’s hands due complainants on account of their contributions to the firm capital Avhich had been received by defendant, AAdiich contributions according to the register’s report amount to $3,038.19. A statement of account Avas rendered by defendant as of December 28, 1894; the same being mailed to complainant Hill at NeAV Orleans. The statement contained charges against the complainants including the Avhole amount of the estimated shortage in the cargo, and also the amount of its bill for the goods shipped to the Burchard Honduras Fruit Oo.

The defendant having ansAvered, a reference was executed before the register. The errors assigned question the correctness of the decree appealed from only so far as it relates to exceptions filed to the register’s report.

1. To enable the defendant to rely on the statement sent Hill as a stated account it was incumbent upon it at least to prove acquiescence therein on the part of complainants. This is has failed to do. For all that appears in the record there may have been prompt objection on the part of Hill and of the other complainants.

2. The register alloAved defendant tAvo credits aggregating $1,000 as having been paid in January, 1895. No one has testified that defendant has paid more than that sum since it rendered the account. We are, therefore, satisfied that I fill’s statement in testimony to effect that he received a check for $1,000 after receiving the account, had reference to the two credits allowed by the register, and that the defendant is not entitled to a credit as for the payment of another thousand dollars.

3. There, is nothing in the partnership agreement binding the complainants to become solely responsible for losses that might occur by reason of shortages, nor is there satisfactory proof of any verbal agreement to become so responsible or of any circumstance which would justify the court in charging them with the shortage here claimed except as to one-half upon the basis of their joint accountability as -was held by the register. It appears that complainant Williams in the capacity of super-cargo was acting for the firm and not for the complainants alone, and there is nothing in the fact that he so acted that would increase the complainants’ responsibility for shortages.

4. The def(aidant’s sale of goods, which were charged to the Burehard Honduras Fruit Company, was not a partnership transaction and had no place in the settlement of partnership matters, except to enable the defendant to retain what may be due it from the complainants out of any balance found against it. The practice of allowing one partner to retain for an individual debt as against a balance so found, has been held permissible. Bates on Partnership, § 020; Mack v. Woodruff, 87 Ill. 570. Conceding such right to the defendant it ivas nevertheless bound to establish its debt against the complainants. Whether it was a corporation or not, there can be no doubt that the defendant had recognized the Burehard Honduras Fruit Company as a separate entity and had contracted with it as such in other matters, and that these goods were charged and shipped to it as such. If it was understood that complainants acted in the purchase of the goods not for themselves, but only in behalf of that concern, then to make them liable therefor it must appear that their relation to that concern was such as to make them responsible for its debts. If the purchase was so made, a mere subsequent'promise to pay, if any was made, would he without consideration. Prom the evidence in the record it was open to the register to find that credit was not extended to the complainants and that they were not liable therefor. The conclusions of the register based upon the testimony of witnesses who were present and testifying before him are not to be disturbed unless they are clearly shown to be Avrong.— Winter v. Banks, 72 Ala. 409; Lehman v. Levy, 69 Ala. 48.

5. There was no error in charging the defendant with interest from the time it rendered the statement to the complainants whereby it assumed the right to withhold the balance which ought then to have been paid.— Wells v. Babcock, 56 Mich. 276.

The decree of the chancery court must be affirmed at appellant’s cost.