Diamond v. Gust

• Citation: 206 S.W. 366
• Decision Date: 29 October 1918
• Docket Number: (No. 7610.)
• Parties: DIAMOND v. GUST et al.
• Court: Court of Appeals of Texas

206 S.W. 366

DIAMOND v. GUST et al.

(No. 7610.)

Court of Civil Appeals of Texas. Galveston.

October 29, 1918.

Rehearings Denied November 14, 1918.

Appeal from District Court, Harris County; J. D. Harvey, Judge.

Suit by D. Diamond against John Gust and others. Judgment for plaintiff in part and he appeals, and defendants file cross-assignments of error. Affirmed.

Huggins & Kayser, of Houston, for appellant.

Cole & Cole, of Houston, for appellees.

LANE, J.

This suit was brought by appellant, D. Diamond, against John Gust and various others, to recover a one-half interest in certain property which was alleged to be owned by a partnership composed of himself and John Gust, for an accounting of said partnership, and for the reasonable value of the use of said property during the time the same was held by defendants other than John Gust.

The plaintiff alleged that he and John Gust were partners in a "restaurant and pool hall" business prior to the 7th day of July, 1916, each owning one-half interest therein and one-half of all the personal property belonging thereto; that it was understood between said partners that the said Gust was to conduct the business and give his entire time thereto and was to be paid out of the funds of the partnership $30 per month for his services; that Diamond was to receive one-half of the net profits of said business; that on the 7th day of July, 1916, said copartnership owned pool tables, show cases, tables, chairs, etc., of the value of $1,500; and that the profit of said business was $250 per month. He then alleged that his partner, Gust, without his knowledge and consent, did, on or about the 7th day of July, 1916, wrongfully and with the intent to defraud plaintiff, sell said business, and all personal property belonging thereto, to other defendants named in his petition. He prayed for an order directing all the defendants who had been at any time engaged in conducting said business to render an itemized statement of profits of said business so as to show what profits had accrued from said business. He prayed for one-half of any such profits, and for one-half interest in the furniture and other property belonging thereto; that the business and all the partnership properties be sold by order of court at either private or public sale; and that the moneys derived from such sale be applied, first, to the extinguishment of certain debts owing by the partnership, and that the balance be paid one-half to him and the other one-half to whomsoever it belonged. He also prayed for judgment against all the defendants for one-half of the profits of said business. He prayed in the alternative as follows:

"If he is not entitled to one-half interest in the profits of said business from July 7, 1916, then he prays judgment for the sum of $50 per month from said date for the use and rental of said property from defendants Stratos Christos, Alex. Seitanides, and John Coroneos, restraining these defendants from in any way disposing of plaintiff's interest in said property during the pendency of this suit or removing the same from its present location, and for such other and further relief both general and special in law and in equity to which plaintiff may show himself entitled."

Defendant John Gust answered admitting the formation and conduct of the partnership and business up to July 7, 1916, as alleged by plaintiff, except he alleges: That the partnership business was run at a loss, and that on said 7th day of July, 1916, said partnership owed various persons an aggregate sum of about $600 or $700 and had no money with which to pay the same or any part thereof. That he had tried to get plaintiff to join him in getting money with which to pay said debts, and that plaintiff refused to do so. That this defendant saw that he could no longer conduct the business, and that he did on behalf of himself and the plaintiff, D. Diamond, on July 7, 1916, sell the entire business to Pete Manuel and M. Tamaris, in consideration of the said Pete Manuel releasing his debt against the partnership in the sum of $135 for borrowed money and wages due him and in consideration of said Manuel and Tamaris assuming and agreeing to pay something in the neighborhood of $600 indebtedness due by the firm of Gust & Diamond. That said sale was in good faith and made for the purpose of paying the debts of the partnership; and that he got nothing whatever out of the consideration for which said property was sold. That he denies that there was any conspiracy on his part to in any way defraud the plaintiff, and that this defendant's action in the premises was the only thing that could be done to protect the indebtedness of the partnership. That he offered to deed the property to the said Diamond, or to sell him his interest in consideration of Diamond paying the bills or seeing that they were paid, and that the plaintiff, Diamond, refused all propositions made to him.

Defendant Alex. Seitanides answered denying that he was guilty of any conspiracy or fraud in the purchase of said business and its properties, and averred that the same was purchased by him in good faith for a valuable consideration without notice of any rights claimed by plaintiff, and that he is now the owner of said property and business. He also averred that he paid the debts due by Gust & Diamond, a part of which was a lien on said property. He also adopted the answer of his codefendant, John Gust, for the purpose of showing the dealings of the several parties with said properties.

The cause was tried before the court without a jury. The trial court found from the evidence: (1) That the one-half interest of plaintiff in said properties had not been divested out of him by the sale made by Gust, and that he still owned said one-half interest; (2) that the...