Fink v. Montgomery

• Decision Date: 24 November 1903
• Docket Number: 20,089
• Parties: Fink v. Montgomery
• Court: Indiana Supreme Court

68 N.E. 1010

162 Ind. 424

Fink v. Montgomery

No. 20,089

Supreme Court of Indiana

November 24, 1903

Rehearing Denied April 1, 1904.

From St. Joseph Circuit Court; W. A. Funk, Judge.

Action by Hugh T. Montgomery against Henry A. Fink. From an interlocutory order appointing a receiver, defendant appeals.

Affirmed.

Andrew Anderson, James Du Shane and W. G. Crabill, for appellant.

O. M Cunningham, for appellee.

OPINION

Dowling, J.

This is an appeal from an interlocutory order appointing a receiver in an action between partners for an account and settlement of their partnership affairs, to take charge of the assets collect debts, and wind up the business of the firm. The error assigned is the action of the court sustaining the motion for such appointment.

The points of objection made by the appellant to the proceedings and order of the court are thus stated: "(1) An action cannot be maintained for the sole purpose of having a receiver appointed. (2) In suits between partners a receiver will not be appointed unless it appears that the assets of the partnership are in danger of loss or depletion on account of the misconduct, fraud, or wrongful acts of defendant partner. (3) When upon a dissolution of a partnership the parties themselves have agreed upon the manner of collecting their accounts and settling up their affairs, a receiver should not be appointed where no violation of the agreement is shown."

The complaint alleged the existence of a partnership between the appellant and the appellee, and its dissolution by mutual consent on September 8, 1902. It was also averred that the assets of the firm consisted of open accounts against divers persons amounting to a considerable sum; that some of these were barred by the statute of limitations; that others would soon be barred, but that all could be collected if diligence were used; that most of these uncollected accounts were made with the appellant, and that the appellee had not sufficient knowledge of them to enable him successfully to prosecute suits for their recovery; that the appellant was failing, neglecting, and refusing to take steps to secure the said accounts; that there were many other claims made by the appellant which have been collected by him, and which he refused to account for, and concerning which the appellee had no knowledge; that there was an irreconcilable disagreement between the said parties in regard to the collection of said claims due to the partnership, and the settlement of the partnership affairs, and that the interests of the parties were suffering from the delay and the contention between appellee and appellant; that the firm owed no debts; that before the commencement of the action appellee demanded a statement, accounting, and settlement of the partnership affairs which was refused. Prayer for an accounting, and for the appointment of a receiver to collect all outstanding accounts. By a supplemental complaint the appellee charged that the appellant, since the bringing of this action, was, without the consent of the appellee, taking promissory notes from the debtors of said late firm in settlement of the claims due said firm. No answer to the complaint was filed.

The proof upon the motion for the appointment of a receiver very fully sustained the complaint. It showed the existence of the partnership; its dissolution; that there were uncollected accounts due the firm; that the appellant refused to press these collections, for the reason that it would hurt his business; that appellant had overdrawn his account by about $ 308, and that he told appellee that he needed that money, and was not going to put his hand in his pocket and give it to appellee; that many of the accounts due the firm had been standing six, or...