Moody v. Rathburn

• Decision Date: 01 January 1862
• Citation: 7 Minn. 58
• Parties: JOSEPH MOODY vs. GEORGE W. RATHBURN.
• Court: Minnesota Supreme Court

7 Minn. 58

JOSEPH MOODY vs. GEORGE W. RATHBURN.

Supreme Court of Minnesota.

Appeal from judgment of the district court, Scott County.

Geo. Bradley, and Smith & Gilman, for appellant.

A. G. Chatfield, for respondent.

EMMETT, C. J.

The plaintiff alleges, in his complaint, that he and the defendant own and possess, as tenants in common, certain lands in the County of Scott, together with the mills and improvements thereon; that his share or interest in said property is the equal undivided two-thirds, and that of the defendant the undivided one-third thereof; that while said parties were using said property and dividing the expenses and profits according to their respective interests aforesaid, the defendant took sole possession thereof to the exclusion of the plaintiff, and has since been in the sole receipt and enjoyment of the earnings and profits of said mills; that he, plaintiff, has expended large sums in repairs and machinery for said mills; and that the property cannot be divided without injury thereto. He therefore asks that the parties respectively be made to account, and that the property be sold and the proceeds appropriated in a specified manner, under the direction of the court. He further asks, for reasons alleged, that an injunction may issue restraining the defendant from further intermeddling with the property, and for the appointment of a receiver.

To this the defendant answers, admitting that the premises are held by the parties in the manner stated in the complaint, and that their interests respectively are as therein specified. He also admits the joint occupation of the mills and premises, but denies that the expenses and profits were to be shared in proportion to their respective interest in the mills. He denies also that he has ever taken control of the mills to the exclusion of the plaintiff therefrom, or from a participation in the profits. He further denies that the plaintiff has expended any moneys, or that he, defendant, has received moneys which he has not accounted for, and claims that there is due to him for moneys expended and for services, the sum of $250.

The defendant then sets out a contract, dated June 23, 1857, made between him and the Belle Plaine Company, for the erection and construction of said mills, and for running and operating the same after completion, which he avers that he kept on his part, but which the said company violated in certain particulars, and then alleges that he took possession of said mills under said contract, and used and occupied them until sometime in August, 1858, when disputes and differences having arisen between him and said company, they were referred to arbitrators for settlement; and that said arbitrators afterwards awarded that he was entitled to one-third of said property, and had the right to take possession of the mills, and operate the same under said contract of June 23, 1857.

He further alleges, that said company, having become insolvent, assigned their interest in such property to D. W. Ingersoll, for the benefit of creditors, by deed dated December 31, 1858, which said deed was expressly made subject to liens and rights under existing contracts; and that said Ingersoll, on the 10th day of September, 1859, assigned or quit-claimed his interest therein to the plaintiff, in payment of a debt then due from said company to the plaintiff; and that the plaintiff had at the time due notice of the contract of June 23, 1857, and of the award made by the arbitrators as aforesaid.

The defendant further alleges, that the plaintiff has sold divers portions of machinery and other property belonging to said mills, and has appropriated the proceeds thereof to his own use; that he has taken exclusive possession of said mills and appurtenances, and ejected the defendant therefrom, and thereupon also took possession of and appropriated a large amount of grain and other property belonging to him and the defendant. He also alleges that said mill property described in the complaint cannot be divided without injury. In conclusion he asks that the plaintiff be made to account, and that the mills may be restored to him, the defendant, and that he be allowed to operate the same under the contract of June 23, 1857.

It is unnecessary to follow the pleadings further. Enough has been stated to show that both parties admit that they are in possession of the property as tenants in common; that the plaintiff owns two undivided thirds, and the defendant one undivided third thereof; and that said property cannot be divided without prejudice to the owners, and each party demands an accounting.

But while the plaintiff asks that their joint occupancy of the property should be terminated, and the property sold and the proceeds divided in proportion to their several interests, the defendant insists on the right to continue operating the mills under the contract of June 23, 1857, and the award, and on the right to retain the plaintiff as a partner, even without his consent. Let us examine, somewhat, into the facts upon which the defendant founds so extraordinary a proposition.

It appears from the report of the referee, to whom all the issues were submitted, that the defendant and the Belle Plaine Company, by the written contract aforesaid, of June 23, 1857, agreed to construct and put in operation mills of a certain description, each party furnishing machinery, materials, and money, therefor, in the manner therein specified; and that after the mills should be completed, the defendant should run and operate them on joint account, each party furnishing one-half of the funds necessary, and receiving one-half the profits — the company, however, guaranteeing that the profits thus coming to the defendant should equal ten per cent. per annum on the amount by him invested, exclusive of his labor.

It further appears that under this agreement, the parties built the flouring mills provided for, and described in the complaint, but that just before they were completed, to wit, on the 19th of December, 1857, they made a new agreement in writing, by which the defendant agreed to give to said company the exclusive use and control of said mills, and also his personal services, from the date thereof until the first day of January, 1859, for the agreed sum of $1,200, payable in monthly installments of $100 each. It was also thereby agreed that the old contract, except as therein modified, should stand, and that all matters of difference between the parties were settled; and thereupon said company conveyed to said defendant the undivided one-half of the lands on which said mills are situated, and appurtenant thereto, declaring in the conveyance, however, that it should not afford any evidence of the respective rights and interests of the parties to the mills themselves. Under this last agreement, the said company operated said mills, until, other differences and disputes having arisen between the parties thereto, they, in pursuance of said agreement, and of the agreement of June 23, 1857, referred the whole matter to arbitrators, by an agreement of submission dated August 6th, 1858, and an agreement supplemental thereto dated January 1, 1859. It further appears that said arbitrators afterwards, on the 3d day of February, 1859, awarded that the interest of said parties in said flouring mill, was as follows, to wit, that of said company was $16,000, and that of the defendant was $8,000; and that their interests in the other property were in the same proportion. They also found and awarded that the parties were restored to their rights respectively under the contract of June 23, 1857, and that the defendant should go into possession of the mills under said contract, according to his interest, as in said award provided. And they further found and awarded that the accounts, claims, and demands, of the parties respectively were mutually balanced; that each should execute to the other a full and sufficient release of all claims, demands, rights, and damages, of every kind and description; and that said award should be a final and full settlement between the parties. And they also provided that either party might apply for the appointment of a receiver. It further appears from the report of the referee, that before the expiration of the contract of lease, dated December 19, 1857, to wit, on the 31st day of December, 1858, the said company, being insolvent, assigned all their interest in said property to D. W. Ingersoll, for the benefit of creditors, subject, however, to all liens thereon, and to the rights of parties under existing contracts; that said Ingersoll and the defendant afterwards, on the 8th day of March, 1859, made a written agreement, reciting their respective interests in the property, as determined by the award aforesaid, by which it was agreed that they should run said mills on joint account, each having half the profits and that defendant was to have for his personal services in running the same (and to be considered as part of the expenses), at the rate of three hundred dollars per annum, from the date of said award, until the first day of October next ensuing; and thereafter such compensation as might be agreed upon by the parties.

It further appears that said Ingersoll afterwards, on the 10th of September, 1859, assigned all of his interest in said property to the plaintiff, in payment of a debt due to the plaintiff from said company; and that the plaintiff thereupon entered into possession with the defendant, and thereafter operated the said mills with the defendant jointly, sharing the expenses and profits in proportion to their respective interests in the mills, etc., until the 18th day of January, 1860, (about the date of the commencement of this action) when he took sole possession of the mills, and excluded the defendant therefrom. The referee also finds that,...