Alexander v. Turner
| Decision Date | 18 April 1941 |
| Docket Number | 31041 |
| Citation | 297 N.W. 589,139 Neb. 364 |
| Parties | JOHN M. ALEXANDER ET AL., APPELLEES, v. MELVIN C. TURNER ET AL., APPELLANTS |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Lancaster county: FREDERICK E SHEPHERD, JUDGE. Affirmed.
AFFIRMED.
Syllabus by the Court.
1. A joint adventure has been defined as an undertaking by two or more persons to carry out a single business enterprise for profit.
2. A contract for a joint adventure, containing no stipulation as to its termination, does not continue for the life of the partners, or either of them, nor for any longer time than their mutual consent, and may be dissolved by either party at his own will at any time.
3. When two persons engage in a joint adventure, each has a right to demand and expect the utmost good faith in all that relates to their common interests, for they stand in a fiduciary relation to each other.
4. One party to a joint adventure may sue the other for a breach of contract, and equity will order an accounting between the parties.
5. In the trial of a civil action, after the plaintiff has introduced evidence tending to establish his case, if defendant fails to testify to matters peculiarly within his knowledge, and necessary to his defense, a presumption exists that his testimony, if produced, would militate against his interest.
6. In the construction of a contract, not only the express terms, but what is necessarily implied from those terms, should be considered.
Appeal from District Court, Lancaster County; Shepherd, Judge.
Action in equity by John M. Alexander and another against Melvin C. Turner, sometimes designated as Charles M. Turner, and others, for the dissolution of a joint adventure and for the issuance of certain shares of stock. Decree for plaintiffs, and defendants appeal.
Affirmed.
Beghtol, Foe & Rankin and Perry, Van Pelt & Marti, for appellants.
Tunison & Joyner, contra.
Heard before SIMMONS, C. J., ROSE, EBERLY, PAINE, CARTER and YEAGER, JJ.
This is an action in equity for the dissolution of a joint adventure, created by a written agreement, and for the issuance of certain corporate shares of stock. Court found for plaintiffs. Defendants appeal.
It appears that the Fidelity Investment Company owns the Metropolitan Apartments in Lincoln, which is the only property that this corporation owns. Plaintiff John M. Alexander purchased and had transferred to defendant Melvin C. Turner 219 shares of common stock and 379 shares of preferred stock of the Fidelity Investment Company. This was done in accordance with a written agreement between the parties, dated September 30, 1935, consisting of two typewritten pages, which provides, in brief, that Alexander contemplates purchasing the above shares of stock from the owner, W. E. Sharp, and said Alexander will cause the said shares of stock to be assigned by Sharp to defendant Turner, who will take charge of and manage said Metropolitan Apartments for 5 per cent. of the gross receipts, and will pay out of the income the taxes, upkeep, and repairs, together with interest on the outstanding mortgage of $ 57,000 owned by the Woodmen Accident Insurance Company, which loan matures in 1940, bearing interest at 4 per cent.
It is stated in said agreement that the above shares of stock represent a majority of the stock in said corporation, and Turner reserves the right to purchase any of said outstanding stock for himself with all profits to be made thereon; that Alexander shall only be entitled to receive his share of the interest in the stock he has purchased of W. E. Sharp. But, by a written amendment of November 5, 1935, the parties changed this last provision in paragraph No. 5 to provide that the two parties would own all stocks that could be purchased in the Fidelity Investment Company in equal shares.
Paragraph No. 7 provided that "when, as, and if" Turner should sell or trade any of said stock, Alexander should receive 50 per cent. of the net profit. It was further agreed that, so long as said stock was held, all net dividends or profits should be divided equally between Alexander and Turner. It appears that Alexander purchased the shares of stock from Sharp, according to their contract, and that Turner on October 2, 1935, deposited the certificate in escrow in the First National Bank, as provided in their agreement.
It is charged by plaintiffs that on December 21, 1938, Turner wrongfully and unlawfully sought to dispose of the shares of stock for his own use and benefit, and in violation of the rights of the plaintiffs, by executing an instrument assigning said stock to Paul H. Schroeder as trustee for the Fidelity Investment Company. By reason of this assignment, in violation of their contract, plaintiff Alexander asked to have the contract terminated, and to declare the partnership, or joint adventure, between the plaintiff and defendant dissolved, and that the Fidelity Investment Company be ordered to cancel and reissue said certificates of stock, issuing to plaintiff Alexander new certificates for one-half of the amount, to wit, 109 1/2 shares of common stock and 189 1/2 shares of preferred stock.
The First National Bank stated in its answer that it is ready and willing to deliver said certificates of stock in accordance with the escrow agreement, but is unable to determine whether or not the plaintiff or any other person is entitled to said shares of stock.
In the answer filed by Melvin C. Turner, Paul H. Schroeder, and the Fidelity Investment Company, it is admitted that Turner signed and delivered to Paul H. Schroeder the assignment of said shares of stock, as charged, but they insist that said assignment was made subject to all rights of plaintiff under the original contract for a joint adventure.
It is charged in defendant's answer that the plaintiff has been attempting to buy up outstanding stock in said corporation to gain control thereof, so that plaintiff can operate the same with sole benefit and profit, in violation of the rights of the other stockholders in said corporation. Defendants pray that the amended petition be dismissed.
The three defendants in their answer claim that this stock should be held as a unit, or block, to prevent either the plaintiff or the defendants from gaining absolute control of the corporation, but there appears to be no evidence offered by the defendants to support this contention, but it is clearly stated in the amendment which they made to the contract that the intention of the parties was that in the final settlement each party should have an equal share in the ownership of stock.
The trial court entered its decree, finding that the plaintiff was the owner of an undivided one-half of 219...
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