Lyon v. Snyder , 61 Barb. 172 ( 1871 )

By the Court, Johnson, J.

The only question in the case is as to the competency of H. D. H. Snyder as a witness for the defendant in the action. The action was brought to wind up and adjust the affairs of the copartnership of L. R Lyon & Co. The plaintiffs are the executors of L. R Lyon, deceased, who was a member of the copartnership, in his lifetime. Such copartnership was dissolved by the death of Lyon on the 7th of April, 1869, but its business, which was that of tanning hides, was not closed till February 1st, 1871, and the action is for a general accounting and settlement, and was referred, and tried by a referee. Accounts were mutually filed, and upon the trial the accounts, as filed and claimed by the respective parties, were agreed upon and admitted, except the defendant’s charge for services for superintending and managing the affairs of the firm. He had had the sole care and management of all the partnership affairs, after the withdrawal of H. D. H. Snyder from the firm, and charged $1500 for his services, in pursuance, as he claimed, of an agreement between the parties, at the formation of the copartnership, that himself, and his brother, the witness, who was also a partner at the commencement, should take the charge and management of all the copartnership affairs, and have a reasonable compensation from the firm for such services. H. D. H. Snyder, the witness, continued a member of the firm from its formation, July 26th, 1866, up to December 31, 1867, when he withdrew therefrom, with the consent of all parties, and assigned all his interest to the defendant, who took his share, and assumed all his liabilities as a member of the copartnership. In the commencement, the interest of Lyon was one half," and that of the two Snyders, one fourth each. But by the withdrawal and assignment before mentioned, the defendant and Lyon became equal partners, and the business -was continued in the same firm name, until the death of the plaintiff’s testator. II. D. H. Snyder, while he continued a member of the firm, assisted the defendant in superin-. tending and managing the affairs of the copartnership, but no charge is made by the defendant for such services, in his account. The defendant claims the same price per year for his services for the entire period.. He made no charge for his services, upon the books of the firm or elsewhere, that appears, until after the death of the testator, when the charges in question were made.

It is conceded, on the part of the defendant, and the rule undoubtedly is, that a charge of this description cannot be sustained and allowed without, proof, on his part, of an express agreement that compensation should be made for such services. The only proof offered, of such an‘agreement, was the testimony of the witness H. D. H. Snyder, to the verbal agreement to that effect between the partners. He was objected to as an incompetent witness, under section 399 of the Code, and the exception to the rule admitting, his testimony presents the question on which the appeal is brought.

By the provisions of this section, “ no party to an action, nor any person from, through or under whom any such party derives any interest or title, by assignment or otherwise, shall be examined as a witness in regard to any personal transaction or communication between such witness and a person at the time of such examination deceased,” &e., against the executor, &c. Had the witness continued a member of the copartnership and been a party to the action, as he necessarily would have been in that case, he would unquestionably have been incompetent. How, then, is he rendered competent by the fact of his assignment ? The interest assigned enters into, and constitutes a part of, the subject matter of this action. The accounting is for the whole business and transactions, through the entire period. It embraces the dealings and accounts'of the witness with the firm, while he was a member thereof, as well as those of the defendant, and the defendant, by the assignment to him, stands in the place of the witness, and is obliged to, account for him in this action. His title to one fourth of all partnership assets is derived, by assignment, from the witness. The question involved in the litigation is, what proportion of all the assets belongs -to the defendant, after an adjustment of all the accounts amongst all who were, at the death of the' testator, or had previously been, members of the copartnership.

The Code excludes every person through whom a party to the action derives “ any interest or title, by assignment or otherwise.” This must be construed to mean any interest or title, in or to the subject matter of the' action. The assignor of any such title or interest is excluded from examination in the action. It is argued, on the part of the defendant, that the witness had no interest in this particular charge and item of the account, and that his right to make it,. and have. it allowed, is not derived from the assignment, and does not depend upon it in any degree. This, perhaps, is not entirely clear; but conceding it fully, for the purposes of this point, it does not help the defendant. The provision of the Code is broader. It excludes such a person from being examined as a witness in the action. The prohibition is not limited to an examination in respect to those matters pertaining to the parts of the action assigned, but extends to the entire action. He cannot be examined at all as a witness in that action, if the party has derived any interest pr title from, through or under him. H. D. H. Snyder was, therefore, incompetent as a witness in the action on behalf of the defendant, as against the executors of the deceased partner, and the exception is well taken.

[Fourth Department, General Term, at Syracuse, November 13, 1871,

Perhaps upon another trial the defendant may be able to give other evidence of the agreement to make compensation for his services, and that opportunity should be afforded him. Should he • elect, however, to abate and strike from the judgment the amount allowed for his services, the judgment should be affirmed; otherwise reversed, and a new trial ordered, with costs to abide the event.

Mullin, P. J., and Johnson and Talcott, Justices.]