Hall v. Clagett

• Decision Date: 08 March 1878
• Citation: 48 Md. 223
• Parties: EDWARD G. W. HALL, Adm'r d. b. n. c. t. a., of HORATIO C. SCOTT v. CHARLES CLAGETT, Guardian and next friend of MARY C. SCOTT.
• Court: Maryland Court of Appeals

48 Md. 223

EDWARD G. W. HALL, Adm'r d. b. n. c. t. a., of HORATIO C. SCOTT v. CHARLES CLAGETT, Guardian and next friend of MARY C. SCOTT.

Court of Appeals of Maryland

March 8, 1878

After a cause has been set down for hearing by consent, without any proof being taken, complainant has no right to put in a replication without the consent of the court or defendant because his rights are affected thereby; but, where proof has been taken, the case is different, for defendant has had the opportunity to support his answer by evidence.

Appeal from the Circuit Court for Prince George's County, in Equity.

The bill in this case was filed on the 1st of February, 1856, in the interest of Mary C. Scott, the only child of Polydore E Scott, by Charles Clagett, her guardian, she being a minor for an account and settlement of the partnership, which had for many years existed between her deceased father and her uncle Horatio C. Scott, who alone was made defendant.

In the year 1826, Horatio C. Scott, and his brother Polydore E Scott formed a mercantile partnership in Upper Marlboro' under the name of H. C. Scott & Co., which continued until the year 1830, when it was dissolved by mutual consent.

In the fall of 1831, they formed another partnership under the name of H. C. & P. E. Scott. This second partnership carried on business until 1842, when its active operations closed, but the firm was not actually dissolved until the death of P. E Scott in May, 1855.

There was nothing to show that there had been any final settlement of the first firm, or any accounts of the business or of the stock taken during the continuance of the last, either annually or at any other time; no entries in the books to show how much stock was put in by either partner, nor balances struck to show whether they gained or lost by their operations. Polydore E. Scott had the general management and control of the business of the second firm, after 1833, and the books of both firms were more or less in the hand-writing of Polydore, and the evidence shows they were kept in such a careless manner that the efforts of several auditors, extending through many years, produced only irreconcilable statements, and giving results widely different, but disclosing the probable fact that the second firm was insolvent in 1842, when it ceased active business. During all this time each of the partners was engaged in planting, and in other pursuits, and a large portion of their crops was carried into the firm, and much of their individual indebtedness settled by the firm.

Their joint and individual business were thus so blended, that there was no means furnished from the books of the concern to distinguish one from the other; nor did the books show, nor was there any statement of any claim on the part of Polydore against Horatio for any portion of the profits of the firm, or for, or on any other account.

Polydore died intestate, and letters of administration on his estate were granted to C. C. Magruder and the said Horatio C. Scott, and the appellee Clagett was duly appointed guardian of the only child of said Polydore. In November, 1855, certain creditors of said Polydore filed a bill for the sale of his real estate, in aid of his personalty in payment of his debts, and a decree was passed for the sale of the real estate, and for an account of the personal estate, which decree was afterwards rescinded with leave to make new parties.

Pending these proceedings the bill in this cause was filed, and was afterwards amended by agreement.

The object and purpose of the bill will be found stated in the opinion of this Court. The defendant answered the bill at length, insisting that nothing was due to the complainant claiming to represent her deceased father, or to his estate, from said partnership or from the respondent. The replication to this answer was not filed until the 9th of March, 1858.

On the 12th of November, 1856, a decree was passed directing the books of the late firms to be brought into Court, and that the parties should account with each other concerning the matters in the proceedings mentioned; and the cause was referred to the auditor to state accounts from the books, &c., and such other evidence as the parties might produce before him, upon the usual notice. Under this decree the auditor, Mr. Mullikin, stated a series of accounts. In April, 1857, the case was referred back to the auditor, with leave to the parties to take testimony. A large mass of testimony was taken by both sides, the time for taking which being repeatedly enlarged by agreement. In September, 1861, the auditor, Mr. Hance, filed in Court various accounts and statements with the evidence taken by him. And on the same day there was also filed certain proof which had been taken by the former auditor. Horatio C. Scott, in the meantime, had died, and his widow, Henrietta M. Scott as executrix, had been admitted as party defendant. Numerous exceptions were filed by each side to the auditor's report, accounts and statements, which were fully argued, and in June, 1863, Judge BRENT filed his opinion, and on the 10th of the same month passed an order referring the case back to the auditor with special instructions in accordance with the opinion.

Further testimony was taken in behalf of the respondent. Henrietta M. Scott, executrix of Horatio C. Scott having died, Edward G. W. Hall was appointed administrator d. b. n. c. t. a. on the estate of the said Horatio, and on application was admitted by the Court as a party defendant to the cause. On the 23rd of June, 1871, Mr. Chew the special auditor, filed his report with accounts and statements. Exceptions were taken by both sides. After various interlocutory proceedings a decree was passed ratifying and confirming the report of special auditor Chew with the accompanying accounts, except account No. 20, which was rejected, and directing the defendant Hall, administrator d. b. n. c. t. a. of H. C. Scott to pay to C. C. Magruder, surviving administrator of Polydore E. Scott, who had been made a party defendant in the cause and had answered, the sum of $1,250.76 with interest from the 7th of May, 1855, and costs. The decree was afterwards modified by providing that the said sum of money so adjudged to be paid, should be paid out of the assets of the deceased.

From the decree and the order modifying the same, this appeal was taken. The case is further stated in the opinion of the Court.

The cause was argued before BARTOL, C.J., STEWART, MILLER, ALVEY and ROBINSON, J.

William H. Tuck and C. C. Magruder, for the appellant.

The bill of complaint ought to have been dismissed, because from the condition of the books, and the manner in which the affairs of both firms had been conducted, and the impossibility of taking proper accounts, after such a lapse of time, entire justice could not be done between the parties. His Honor, Judge BRENT, refused to have an account taken of the first partnership; and the appellant contends, that the principle applies equally to both. Story Eq., 529; Steiger's Adm'r vs. Hillen, 5 G. & J., 129.

It is impossible to form a correct idea of these books, without actual inspection. Mr. Chew, the auditor, says: "He submits, that apart from the numerous evidences of great irregularity in the manner in which said books were kept, apparent from the books themselves, the evidence shows that many of the accounts embraced in the list of balances, and of large amounts, were actually settled in the life-time of both parties, although remaining open, and not entered in the books--other items in the said statement of very large amounts are shown by the proof to be wholly incorrect;" and then he shows what corrections he had made, and that so far from there being any assets of the firm, as shown by the list of balances, it was actually insolvent by $14,792.15. He points out the proof leading to this result, and that the firm was insolvent, both in 1842 and 1855. They had done no business, as a commercial firm, since 1841 or '42, and during all the time that elapsed 'till May, 1855, P. E. Scott, who had general charge of the books, allowed them to remain in this condition, and most, if not all, of the difficulty in taking accurate accounts, was owing to his omission to close the books by proper entries.

So far as the business and purposes of the last partnership are concerned, it was as much dissolved, practically, in 1842, as it was in 1855, when P. E. Scott died.

After they sold their goods to Phillips, about 1842, they ceased to be a firm, except for the purpose of settling their joint affairs, and perhaps were worse off in 1855 than they were in 1842, when this bill was filed; the reasons given by Judge BRENT for not taking an account of the first firm applied as well to this: " The difficulty of doing entire justice;" " the original transactions had become obscure by time;" " important evidence had passed away and become lost;" " the demand was stale, the lapse of time too great, and no particular circumstances to excuse or justify the delay shown to exist. " And these books were as obnoxious to his just criticism as were those of H. C. Scott & Co. Of the last firm, he says: "In what kind of business, if any, they were engaged after 1842, does not appear, nor does it appear what became of their assets, or in what manner any subsequent indebtedness or liability of the firm was created. This condition of things surrounds the case with extraordinary difficulties."

If any injustice should result from not taking accounts of these firms, it is not the fault of the defendant. The complainant is in no better plight than her father would be, if alive and he could not take advantage of his own negligence, or place the defendant under the necessity...