Hoag v. Alderman

• Decision Date: 20 October 1903
• Citation: 184 Mass. 217,68 N.E. 199
• Parties: HOAG v. ALDERMAN.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

184 Mass. 217

68 N.E. 199

HOAG v. ALDERMAN.

Supreme Judicial Court of Massachusetts, Hampden.

October 20, 1903

COUNSEL

Charles E. Hoag, for plaintiff.

Clinton Gowdy and John McKean, for defendant.

OPINION

KNOWLTON, C.J.

This is a bill in equity for an account from the defendant as a partner of the plaintiff in the purchase, management, and sale of real estate. The only matter now in dispute is whether the defendant is entitled to an allowance of $500 which the plaintiff agreed to pay him for his services in the care and management of the property. A justice of the superior court heard and decided the case upon facts and evidence contained in a master's report, and the case comes before us upon exceptions taken by the plaintiff to his refusal to give certain rulings.

The court ruled, in accordance with the eleventh request, namely 'That if the defendant chose to do a service which at the time he meant to be gratuitous, or not at the express request of the plaintiff, he cannot recover for such services, even though they are beneficial to the plaintiff;' and refused the sixth and tenth requests, because they were inapplicable to the case; the sixth being that a mere moral obligation is not a sufficient consideration to support even an express promise, and the tenth that a past or executed consideration is not sufficient to create a liability. He also found 'that the acts of the defendant, done with the knowledge and consent of the plaintiff, and more or less beneficial to him, were tantamount to a request on his part that the defendant do what he did.' He found that this sum should be allowed to the defendant. The finding is, in substance that the defendant's services were rendered under such circumstances as to create an implied contract on the part of the plaintiff to pay for them. If there was any evidence to warrant this finding, there was no error of law in the refusal to give the rulings requested. It is a familiar rule of law that in an ordinary partnership, in the absence of an express agreement, a partner is not entitled to compensation for services rendered in the business of the firm. This rule is of general application, and is applied with considerable strictness. Dunlap v. Watson, 124 Mass. 305. The reason for it is that in what the partner does for the firm's business he is presumed to be acting in his own interest, and, in the absence of an express agreement to the contrary, it is ordinarily expected and implied that each member of the firm will devote himself to the promotion of the interests of the partnership without compensation. It follows that courts, in ordinary cases, will not make a comparison of services rendered by the several copartners for the purpose of determining their value, or whether either of the parties shall receive compensation. This rule is founded on the presumed intent of the copartners in entering into the contract of partnership. Of course, if there is an express agreement for compensation, the agreement is given effect. The partnership may be of such a peculiar kind, and the arrangements and the course of dealing of the partners in regard to it may be such, as pretty plainly to show an expectation and understanding, without an express agreement upon the subject, that certain services of a copartner should be paid for. Such cases, presenting unusual conditions, are exceptions to the general rule above stated. Bradford v. Kimberly, 3 Johns. Ch. 431; Caldwell v. Leiber, 7 Paige, 483; Emerson v. Durand, 64 Wis. 111-118, 24 N.W. 129, 54 Am. Rep. 593; Levi v. Karrick, 13 Iowa, 344; Lewis v. Moffett, 11 Ill. 392-399; Van Housen v. Copeland, 180 Ill. 74-83, 54 N.E. 169; Cramer v. Bachman, 68 Mo. 310; Godfrey v. White, 43 Mich. 171, 5 N.W. 243; Lee v. Davis, 70 Ind. 464-469. See Winchester v. Glazier, 152 Mass. 316, 25 N.E. 728, 9 L. R. A. 424. The real question in each case is, what was the intention and the understanding of the parties? to be derived from their contract of copartnership. An express agreement in regard to compensation shows their intention. In the absence of an express agreement on that subject, the presumption that no compensation is to be allowed precludes compensation, unless the other agreements as to the business to be done and the mode of conducting it show that compensation for certain services was intended. If this intention is doubtful, the subsequent course of dealing and conduct of the parties may be considered in determining whether there is such an implication in favor of the allowance of compensation as is tantamount to an express agreement.

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