Mackie v. Mott

• Decision Date: 06 July 1898
• Citation: 47 S.W. 897,146 Mo. 230
• Court: Missouri Supreme Court
• Parties: MACKIE v. MOTT et al.<SMALL><SUP>1</SUP></SMALL>

47 S.W. 897

146 Mo. 230

MACKIE v. MOTT et al.¹

Supreme Court of Missouri, Division No. 2.

July 6, 1898.

PARTNERSHIP — REAL PROPERTY — PARTICIPATION IN PROFITS — CONTRACTS — EVIDENCE.

1. Though two or more persons owning real property contract with another respecting the improvement of such property, and the profits arising therefrom on the sale thereof, mere participation in such profits does not constitute such persons a co-partnership, as such fact depends on the intention of the parties, as ascertained from all the circumstances proved.

2. Plaintiff sued to dissolve an alleged co-partnership and for an accounting, and testified that defendants, who had certain unfinished houses, proposed to furnish the money required, and to give him one-third of the profits from the sale of such houses, when completed, if he would attend to the completion thereof, and that he did the work required, according to such agreement, and used therein money of his own to a certain amount. The property was in charge of one of the defendants, who testified that plaintiff did the work thereon as a contractor. It was also shown that plaintiff had previously proposed in writing to furnish all labor and materials for such purpose, and that he thereafter gave receipts as "contractor," receipted to defendants for certain moneys "on account of contract for" such work, and gave orders on them for work done and materials furnished by others. Held, that such alleged co-partnership was not proven.

Appeal from St. Louis circuit court; John M. Wood, Judge.

Suit by James H. Mackie against Frederick W. Mott and another. From a judgment in favor of plaintiff, defendants appeal. Reversed.

Hornsby & Harris, for appellants. Dawson & Garvin, for respondent.

BURGESS, J.

This is a suit by plaintiff — who alleges in his petition that he was a partner with defendants under a verbal agreement, by the terms of which he was to superintend the completion of four partly-constructed houses belonging to defendants, which upon their completion were to be sold, and the net proceeds or profits divided equally between the three — for a dissolution of the partnership, an accounting, a sale of the property, and distribution of the profits, if any. Defendants deny the partnership, and allege that plaintiff did the work on the houses as contractor with them. The evidence adduced by plaintiff was substantially as follows:

Plaintiff, in his own behalf, testified, in substance: That in the fall of 1893 defendant Mott stated to him that he (Mott) had four houses on the property described in plaintiff's petition, which one Rowe had started to build for him, and had abandoned; and Mott asked plaintiff to give him an estimate of the amount required to finish these houses. Mott proposed to give plaintiff one-third of the profits to be derived from these houses, if plaintiff would give his time and attention to the completion of the houses; defendants furnishing the money required to complete the same. When the houses were completed, they were to be sold, and the profits, after reimbursing Mott and Sauer, were to be divided equally between the three. Plaintiff and defendant agreed then to this, and plaintiff started to work on the houses. There was at that time a deed of trust for about $5,500 on the property; also, mechanics' liens amounting to about $1,500. Defendants were to borrow sufficient money on the property to pay off these debts and to complete the houses. They were to borrow $4,000 on each house and lot, — $16,000 in the aggregate. This money was borrowed from Farish on the two east houses, and from M. D. Lewis on the west house. Part of the money borrowed from Farish was used in paying off the mechanics' liens, and the existing deed of trust held by O'Reilly. The balance of the money borrowed by defendants of Farish and Lewis was used in completing the houses. An additional loan of $4,500 was subsequently made of Carpenter, to be used in completing the houses. The cost to complete the houses when witness took charge was $13,466, and $6,200 was the amount of existing incumbrances. When defendant Mott asked plaintiff to make an estimate of the cost to complete these four buildings, Mott asked him to make a written bid, so that he (Mott) could show it to another builder, named Wright, who, Mott said, wanted to figure on the work; and Mott stated that he wanted to be able to show Mackie's bid to Wright, so that Wright would see that Mott had given him a chance, but that he had failed to get the job. Mott did not want Wright to get the job, but did not want to offend him. So plaintiff then made Mott a bid to do the work for about $11,000. When this money was borrowed from Farish and Lewis, a bond was given to them against mechanics' liens. When witness started on the work he received the plans and specifications, and suggested several changes, which were agreed to by Mott. Defendant Sauer lived in Ohio, and left the entire management of the property to his co-tenant, defendant Mott. Defendant Mott called to see the houses when the work was almost finished, and seemed pleased. The first time witness knew that Mott claimed witness was doing the work on the houses as a contractor was when witness gave a man an order on Mott for some money, and Mott told the man that he had overpaid Mackie on the contract. The actual cost of completing the houses was $13,466, of which $2,105 was for extras. The money was paid out by Mott, either by cash, or by orders on Farish, Lewis, and Carpenter. Several of the subcontractors having bills unpaid enforced their liens, and obtained judgments against the property. Some of these have been paid by Mott. Witness paid $1,500 or $1,600 out of his own funds on account of these houses. On cross-examination plaintiff testified that the agreement with defendant Mott whereby he was to be a partner in the houses was all made prior to his giving the written bid or estimate to Mott. Mott and Sauer exchanged three of these Flad avenue houses, which were incumbered for $12,000, with Mr. James M. Carpenter; receiving from Carpenter a house and lot on Morgan street, which they valued at $11,000, but which witness told Mott was not worth $11,000. This sale was made through the efforts of witness, and in order to get money to clear the debts on the Flad avenue houses. After this exchange, $4,500 was borrowed on the Morgan street property to pay off debts on the Flad avenue houses. These houses were completed in August, 1894. By witness' agreement with defendants, he was to finish the houses, they furnishing the money, and he to get one-third of whatever margin or profit remained after everything had been paid, — deed of trust and all. Mott and Sauer borrowed $16,000 on the houses, and with this they paid off the existing O'Reilly deed of trust and all existing lien claims; and the balance of the money was paid out direct by the parties who made the loans, on Mott's order, for labor and material. Witness had to get an order from Mott for everything he wanted. Witness would give an order, and get Mott to sign it; and the party holding the order would then present it to Lewis or the others, and get the money. Although the houses were finished in August, 1894, witness had the keys until the spring of 1895. He notified Mott in January, 1895, that the keys were at witness' office. Witness held the keys subject to the order of Sauer and Mott. The houses were vacant and idle during the time. The partnership agreement between the plaintiff and defendant was not in writing. The money that witness received from Mott on account of these buildings was deposited in bank in witness' individual account, and checked out as he used it to pay for labor, etc. Witness identified the papers subsequently offered in evidence by defendants, namely, receipt dated April 28, 1894; order dated May 2, 1894; order for $300 dated May 1, 1894, signed by witness; two bonds dated April 14, 1894, signed by witness; a receipt dated June 22, 1894, signed by witness; a bid or proposition dated February 8, 1894, in witness' handwriting, — but denies that the word "Contractor" after his signature on the receipt of April 28, 1894, is in his handwriting. Witness states that the Flad avenue house remaining unsold is worth $7,000 or $8,000, — "somewhere there." W. J. Holbrook testified on behalf of plaintiff: That he was in the real-estate business. Had several conversations with Mott and Mackie about the trade of three of the Flad avenue houses for Carpenter's Morgan street property. Witness understood from Mackie and Mott that they and Sauer owned the Flad avenue property. They said that they were the owners. Witness acted as agent in making the trade. According to witness' recollection, he did not know until the contract for the exchange was signed that the title to the Flad avenue property was in Mott and Sauer. The Carpenter property on Morgan street was worth $10,000 when this trade was made, in August, 1894, but has depreciated in value now. It might sell now for $8,750 or $9,000. The cash value of the Flad avenue houses at the time of the trade with Carpenter was about $6,750 each, and $7,000 for the corner house. J. H. Farish testified for plaintiff: That he is a real-estate agent in St. Louis. On the solicitation of plaintiff, witness considered the advisability of loaning $8,000 on two of the Flad avenue houses. He saw Mott about the matter. Witness made the loan through the Mississippi Valley Trust Company. From conversations with Mott and Mackie, witness learned that these Flad avenue houses "belonged to Mott and Sauer, and that the building contractors who had the buildings originally left them, for some reason, in an unfinished condition, and that Mackie came to an agreement with Mott that, if the money was furnished, he would finish the houses, and he was to get a certain interest (one-third) in the houses when they were sold." Witness loaned Mott and Sauer $8,000 on two...