Bohmfalk v. Vaughan

• Decision Date: 07 December 1960
• Docket Number: No. 6783,6783
• Citation: 357 P.2d 617,89 Ariz. 33
• Parties: Marlin BOHMFALK and Dorothy Bohmfalk, his wife, Appellants, v. Ralph VAUGHAN, Appellee.
• Court: Arizona Supreme Court

Page 617

357 P.2d 617

89 Ariz. 33

Marlin BOHMFALK and Dorothy Bohmfalk, his wife, Appellants, v. Ralph VAUGHAN, Appellee.

No. 6783.

Supreme Court of Arizona.

Dec. 7, 1960.

Beer, Seaman & Polley, Phoenix, for appellants.

John Pintek, Bisbee, for appellee.

PHELPS, Justice.

This is an appeal by appellants, defendants below from a judgment entered in favor of the appellee-plaintiff. The parties will be referred to as defendants and plaintiff as they appeared in the trial court. The cause was submitted to the jury on interrogatories. The court then made findings of fact and conclusions of law on the request of the defendants.

From the record it appears that prior to August 1953 the plaintiff was operating a service station business in Douglas, Arizona, in a service station owned by Standard Oil Company, and leased to him. Thereafter negotiations began between the plaintiff and defendants to set up a partnership. On August 19, 1953, the parties entered into a written partnership agreement for the operation of said service station in Douglas, Arizona. This partnership agreement in the part material for our review here provides:

Clause

'6. The capital of said firm to be $7,000.00 to be contributed and paid into the firm equally by the partners.

'9. Quarterly, beginning on October 1st, 1953, a full and complete inventory of stock shall be taken, and a complete statement of the partnership shall be made, and an accounting between the partners shall be had, * * *. Neither partner shall be permitted to withdraw any profits or funds from said business for his own personal use during any three month period in advance of the above mentioned accounting date except that each partner may draw as wages an amount mutually agreed.

'12. This partnership may be terminated at any time by a written instrument, the terms of which are mutually agreed.'

On the same date the plaintiff sold to the defendants an undivided one-half interest in said business together with the merchandise, gasoline and oil, trade fixtures and equipment, four trailers and miscellaneous items for the sum of $3,500. This sale was accomplished by the execution of a bill of sale as of that date and the payment by defendants to plaintiff of $2,000 on the purchase price with the $1,500 balance to be evidence by a promissory note which said note was to be signed at a later date by the defendants. Said note, however, was never signed by the defendants. At the time of the negotiations and sale of the one-half interest, the plaintiff disclosed to the defendants the true facts relating to the business and of the cost to him of the merchandise, inventory and equipment.

The defendants claim that on September 4, 1953, the plaintiff by a bill of sale transferred and sold to the defendants the whole business including the plaintiff's interest, a certain Chevrolet pick-up truck and bank account for $3,000. They further claim that the $3,000 has been fully paid by the $2,000 on the 19th of August and by the payment on September 8th of the remaining $1,000 to the plaintiff. This contention, however, was not supported by the evidence. The court and the jury found that this purported sale, claimed to have been made by the plaintiff to the defendants during the month of September 1953, was without consideration and that the transfer of property to the defendants was made by the plaintiff because of the fraudulent representation made by the defendant Marlin Bohmafalk that the property described in the said bill of sale should be conveyed to him to protect him against the plaintiff's creditors, or against persons who might sue plaintiff. There was no evidence adduced at the trial that the plaintiff feared his creditors nor was there any evidence that he attempted to defraud same.

On September 3, 1953, the plaintiff transferred the equity of his Chevrolet pick-up truck to the defendant and continued to use said truck as a partner in the business. The transfer of the truck made it the property of the partnership. At the time of transfer the plaintiff had an equity in the truck of $500. The defendant has never paid anything for the equity of the truck since it has become the property of the partnership.

The plaintiff and defendant continued to operate said service station in Douglas, Arizona, as a partnership, and held themselves out as partners during the months of October, November and December of 1953 and during the month of January 1954. On or about February 21, 1954, the defendants demanded that they have sole possession and control of said service station business and then wrongfully excluded the plaintiff therefrom. On or about July 25, 1954, the defendants purported to sell the business to one Mark Anthony. Before this purported sale the plaintiff served notice and claim upon Mark Anthony to the effect that the plaintiff claimed an interest in said business. No settlement or accounting was ever made between the parties as provided in said partnership agreement.

Plaintiff then brought this action against defendants. Trial was had and the cause submitted to a jury on interrogatories as above stated. On July 14, 1958, the trial court by its decree dissolved the partnership then existing between the parties and awarded the plaintiff the sum of $1,576.62 on the accounting made in this action. From this judgment the defendants have appealed to this Court.

Defendants essentially have made five assignments of error which merit our consideration. First, defendants contend error based upon insufficiency of the evidence. The trial judge heard the evidence in the case consisting of a transcript of eight hundred pages. We have carefully read the evidence and find a number of sharp conflicts therein which bear directly upon the material issues in the case. It is our steadfast rule that we will not disturb the finding and judgment of the trial court based upon conflicting evidence regardless of whether it was tried to the court or to a jury. Winterton v. Lannon, 85 Ariz. 21, 330 P.2d 987; Anglin v. Nichols, 80 Ariz. 346, 297 P.2d 932. Under such circumstances the evidence will be taken in the strongest manner in favor of the plaintiff and in support of the court's findings, and the judgment will not be disturbed when there is any reasonable evidence to support it. Winterton v. Lannon, supra; Church v. Meredith, 83 Ariz. 377, 321 P.2d 1035. Here the trial judge and the jury were faced with the problem of determining the credibility of the plaintiff and the defendants relating to the facts and circumstances surrounding the operation of this service station business. They chose to give greater weight to the plaintiff's testimony and to that of the plaintiff's witnesses. There is reasonable evidence to support the finding and judgment of the court.

Second, the defendants contend error upon the submission to the jury of the question of whether or not a partnership existed between the parties. Whether a partnership exists between parties has been said to be a mixed question of law and fact. It has been loosely held that the question is one of fact. The general rule is that, where the question depends on the interpretation of a written instrument particularly if the written instrument is unambiguous, or is complete and expresses in good faith the full understanding and obligation of the parties, the question as to whether a partnership exists is one of law for the court; while, if the facts are in dispute, or the evidence is conflicting or open to more than one inference, or in the absence of an unambiguous contract of partnership, the question is one of fact for the jury. 68 C.J.S. Partnership § 59; Preston v. State Industrial Accident Commission, 174 Or. 553, 149 P.2d 957. There is no dispute here that an unambiguous partnership agreement was entered into between the parties. However, we do find that the evidence was in sharp conflict concerning whether or not the partnership agreement went into effect and if it did whether or not such agreement was superseded by a subsequent agreement. This conflicting evidence coupled with the fact that such was open to more than one inference presented a question of fact for the jury.

Third, defendants contend the trial judge committed error by making findings of fact and that he did not accept all of the jury's answers to the interrogatories. It should be noted here that the defendants were the ones who requested the trial judge to make findings of fact and conclusions of law. If such request led the court into error then the...