Hughes v. Ewing

• Citation: 162 Mo. 261,62 S.W. 465
• Parties: HUGHES v. EWING et al.
• Decision Date: 26 March 1901
• Court: United States State Supreme Court of Missouri

62 S.W. 465

162 Mo. 261

HUGHES v. EWING et al.

Supreme Court of Missouri, Division No. 2.

March 26, 1901.

PARTNERSHIP — CREATION THEREOF — AGREEMENT BETWEEN PARTIES — INTENTION — EVIDENCE — FINDINGS OF FACT.

1. On an issue, in an action by a vendor to recover the price of land, as to whether defendants were partners in the purchase of the lands under a contract for purchase by one defendant and a resale, or whether it was only an agreement for the division of the profits resulting therefrom, evidence that the purchasing defendant did not demand that the defendants should not repay their share of the price paid for the lands for 15 months after the purchase, and correspondence at such time relating to the contract, and a prior certificate by the purchasing defendant that the other defendants had performed their part of the contract, is admissible, as tending to show that the parties did not intend to create a partnership.

2. Findings of fact by the court, when separate and distinct from its conclusions of law, stand as a special verdict or agreed case, in the absence of exceptions thereto; and hence the cause will be affirmed if the conclusions of law based thereon are correct.

3. Defendants entered into a contract by which one was to purchase and pay for certain real estate, on part of which another defendant was to erect car shops; and the balance of the land was to be resold after the property had increased in value by the erection of the shops, and the proceeds, after repaying the purchase price of the lands, were to be divided between the defendants. The purchaser was to have entire control of the lands, except that on which the shops were erected, till he was reimbursed for the purchase price. The defendant, required to purchase the land, did so, but did not pay cash therefor, as required by the contract. Held, that the contract did not create a partnership between the parties thereto, which would enable the vendor to recover the purchase price of the land from the other defendants, since the contract only required a division of profits, and not of expenses.

4. A provision in the contract requiring the defendant purchasing and having the sale of the lands to keep books, and requiring the submission of trial balances, does not tend to show a partnership, but, rather, a means of determining the division of the profits, since partners have a general right, independent of contract, to inspect the partnership accounts.

Appeal from circuit court, Jackson county; Edward L. Scarritt, Judge.

Action by James Hughes against W. N. Ewing and others to recover the price of land sold. From a judgment in favor of certain defendants, plaintiff appeals. Affirmed.

Waggener, Horton & Orr, Elijah Robinson, Chas. R. Pence, and Claude Hardwicke, for appellant. Lathrop, Morrow, Fox & Moore and McKeighan, Barclay & Watts, for respondents.

BURGESS, J.

On the 29th day of January, 1887, and for some time prior thereto, the defendant McMillan was the president of the Missouri Car & Foundry Company, a resident of St. Louis, Mo., and engaged in the business of manufacturing and selling cars and doing a general foundry business. At the same time the company owned a branch plant in the state of Indiana, which McMillan had decided to move to some point in the immediate vicinity of Kansas City, — Argentine, Kan., being preferred; and to that end he communicated with his personal friend, N. T. Spoor, who was then local superintendent of the Atchison, Topeka & Santa Fé Railroad Company, with the view of ascertaining at what price suitable land could be purchased for the purpose of locating said branch works. Spoor turned the matter over to the defendant Roraback, who communicated his object to defendant Ewing. Defendants Ewing and Coburn were then partners in the real estate business in Kansas City, and had been for some time engaged in buying and selling lands for themselves and for others in and about said city, and were well posted with respect thereto. As a result of the communications between Ewing and Roraback, a meeting was arranged for between them and McMillan, at the latter's house, in the city of St. Louis, on the 24th day of January, 1887, when the following contract was entered into between them, to wit: "This agreement made and entered into this 24th day of January, A. D. 1887, between William McMillan, of the city of St. Louis, Missouri, party of the first part, and John Z. Roraback, of the city of Kansas and state of Missouri, party of the second part, and W. N. Ewing, of the city of Kansas and state of Missouri, party of the third part, witnesseth: That whereas, the said party of the first part intends forthwith to found, build, and carry on a large foundry and car works at or near Argentine, Kansas, which said foundry and car works will occupy a large space of ground and employ a large number of workmen, and the location of said works will, presumably, greatly enhance the value of land in the vicinity of said works; and whereas, it is the intention of said third party to purchase land in the neighborhood of said foundry and car works for the mutual benefit of the parties hereto: Therefore it is agreed that the said party of the first part and second part shall designate where the said foundry and car works shall be built, and the said party of the third part shall forthwith proceed to buy all of the land in that vicinity that it is possible to get, at the lowest possible price, and in such manner as to avoid as far as possible the enhancement of values until all of the lands possible shall have been bought, and that the said third party shall furnish all the money for such purposes, and defray all the expenses thereof, and pay all taxes and special assessments and dues on said lands promptly, and so as to avoid all penalties and discounts, and that no advances of the said third party shall bear interest; that the said purchases and payments shall be made, as far as possible, without commissions, and in no event shall the said third party, or any firm he may be connected with, charge any commission or rebates, or receive any share of any commissions or rebates, but that, where possible, the said party of the third part, or any firm with which he may be connected, shall exact their share of any commissions or rebates in any sales or payments according to the regular course of trade, and the said share of rebates or commissions shall be paid and accounted for, for the benefit of all the parties hereto. It is further agreed that a strip of land twenty-five hundred feet long by six hundred feet wide is to be deeded by the said party of the third part to said party of the first part, for the sum of one dollar, for the purpose of building said foundry and car works thereon as soon as said strip of land shall be designated by said party of the first part. It is further agreed that the rest and residue of said land shall be sold as soon as may be for the best interests of the parties hereto, and that the cost price of the said lands, together with the cost price of the lands deeded to said party of the first part for the erection of the works, and all necessary expenses incurred in making said purchases, shall be first repaid to said party of the third part, without interest on the same, or any rebate or commission to said party of the third part, or any firm with which he may be connected, from the moneys received from the first sales of said lands, and the remainder received from the sales of said lands shall be divided equally between the parties hereto, share and share alike, within ten days from receipt of same by said party of the third part: provided, there is of said money on hand the amount of three thousand dollars, which shall have been received from sales of said land by said party of the third part. It is further agreed that the said lands, other than the land so set off for the said foundry and car works, shall be sold and the profits divided by the 1st day of April, A. D. 1888, unless otherwise mutually agreed by the parties hereto, and that, if any lands remain unsold at the said above-mentioned date, the same shall, unless otherwise mutually agreed (after the cost price and all expenses for all lands purchased under this contract shall have been repaid said party of the third part), be divided between the parties hereto, share and share alike, and all necessary deeds mutually executed. It is further agreed that all lands purchased under this agreement shall be entered by said party of the third part in separate books to be kept for such purposes, and that the cost price, commissions, rebates, and expenses of every nature incurred in the purchase and sale of said lands shall be forthwith entered in said books, and that the said books shall always be kept open to each of the parties hereto, their agents or attorneys; that the said party of the third part shall use his knowledge of the location of said works only for the benefit of the parties hereto, and that all the land in the neighborhood of said works purchased by said party of the third part, either directly or indirectly, in his own name or in the name of any other person or persons whatsoever, and all lands to be purchased in the neighborhood of said works by any person or persons at the suggestion of said third party, or by any knowledge derived from the said third party, wherein said third party shall have any share, or wherein he shall derive any benefit, shall be deemed to be purchased subject to this agreement, and for the joint benefit of the parties hereto share and share alike; and any and all such share or interest or advantage of profit of the said party of the third part shall be for the joint benefit of the parties hereto, and all such purchases, interests, advantages, or shares shall be forthwith entered in said books and accounted for to the first and second parties. It is covenanted by the said party of the first part that the...