Newton v. Tracy Loan & Trust Co

• Decision Date: 10 January 1935
• Docket Number: 5397
• Citation: 40 P.2d 204,88 Utah 547
• Parties: NEWTON v. TRACY LOAN & TRUST CO
• Court: Utah Supreme Court

40 P.2d 204

88 Utah 547

NEWTON v. TRACY LOAN & TRUST CO

No. 5397

Supreme Court of Utah

January 10, 1935

Opinion on rehearing, 88 Utah 568, 56 P.2d 624.

Appeal from District Court, Third District, Salt Lake County; Melvin C. Harris, Judge.

Suit in equity by C. W. Newton against Tracy Loan & Trust Company, a corporation, as executor of the last will and testament of Joseph P. Megeath, deceased, wherein defendant counterclaimed.From judgment for plaintiff as amended upon motion for new trial, defendant appeals.

AFFIRMED.

Cheney Jensen & Marr and Walter C. Hurd, all of Salt Lake City, for appellant.

L. B Wight, of Salt Lake City, for respondent.

MOFFAT, Justice.STRAUP, C. J., and ELIAS HANSEN, J., concur.FOLLAND and EPHRAIM HANSON, JJ., dissent.

OPINION

MOFFAT, Justice.

This is a suit in equity.The plaintiff alleged in his original complaint a partnership between himself and one J. P. Megeath, now deceased, and sought an accounting.The complaint also contained a count for the recovery of money had and received or moneys advanced by plaintiff to or for the use of Megeath.Several changes were made in the pleadings by amendments until in the final form, as nearly as the subject-matter may be classified, the claim of the plaintiff is for the recovery of a balance alleged to be owing upon a mutual or open and running account.

From the pleadings it appears that Joseph P. Megeath died on November 3, 1929, leaving property in the state of Utah; that the defendant, Tracy Loan & Trust Company, was on November 22, 1929, appointed executor of the last will and testament of Megeath; that from about 1913 until the death of Megeath, plaintiff and Megeath had engaged in various business enterprises; that Megeath became indebted to the plaintiff for money advanced and money collected and retained, or withdrawn from the various business enterprises in which they were engaged, and designated as an open mutual and running account, upon which there was a balance due to the plaintiff, the sum of $ 12,506.92 with interest; that after the death of Megeath and within time, plaintiff duly presented his duly verified proof of claim in writing against the estate of deceased; and that the claim was rejected.

The defendant, as executor, answered and counterclaimed, admitting appointment as executor, presentation of claim, and refusal to allow or pay the claim, and alleged affirmatively that the moneys claimed to have been paid or disbursed by the plaintiff were paid or disbursed in connection with several separate and distinct business enterprises, enumerating them as: (a) Expenditures in connection with the construction of three houses; (b) the purchase or transaction relating to a 20 horse power motor; (c) in the matter of a "Montana Oil Venture"; (d) a matter designated as "Cummings Candy Company" venture; and (e) in connection with a matter entitled "Re Lyn.Holding Co."

The defendant maintains that the various matters in which the plaintiff and Megeath were interested were separate and distinct transactions; that any claim that plaintiff may have is barred by the statute of limitations.

The defendant also claimed an indebtedness due to deceased upon three promissory notes, one for $ 1,000 dated August 2, 1928, signed by plaintiff and by Franklin Motor Car Company, a second note for $ 7775.23, dated August 30, 1928, signed by plaintiff, and a third note for $ 4,600, dated March 1, 1929, signed by plaintiff and by the Franklin Motor Car Company; the first and second payable direct to Megeath and the third payable to the Continental National Bank of Salt Lake City and indorsed by Megeath, which because of plaintiff's failure Megeath had been required to pay.The defendant further alleged that between May, 1923, and February, 1927, Megeath had advanced and paid to or on behalf of plaintiff various sums of money upon an open account, and that there was due and owing from plaintiff on such account to defendant the sum of $ 2,116.50, making an apparent total of $ 8,491.73.

By reply plaintiff denied that the moneys paid by plaintiff or that withdrawn by Megeath were paid and disbursed as distinct and separate transactions; and alleged affirmatively that such advances, payments, and transactions were all part of a joint business between Megeath and plaintiff; that from 1913 to 1929 the account was an open, current, and mutual account; that the balance changed from time to time and may have been in favor of one at one time and the other at another; but was never fixed or determined as to just what the reciprocal demands or liabilities were.

It was alleged that the house transaction extended over the period from 1913 until October 22, 1925; that the motor transaction occurred about 1923 and had never been adjusted; that the Montana Oil venture extended over the time from June, 1923, to February, 1927; that the connection with the Cummings Candy Company extended from January, 1924, until December 6, 1926; and the Lynndyl Holding Company operations were from January, 1924, to May 10, 1927; and that all of those transactions went into a mutual, open, and running account.

The plaintiff admitted the execution and delivery of the three notes and claimed that they had all been paid by crediting Megeath with the full amount thereof upon the account, and denied there was anything due to the defendant on the counterclaim.From the issues as thus made up, the case was tried.The trial resulted in a judgment in favor of the plaintiff.The defendant has appealed.

The assignments of error are numerous and involved; the argument is lengthy, detailed, and more or less complicated.The burden of the argument of appellant goes to the question of credibility of witnesses and weight to be given to the evidence submitted to and received by the trial court.

The court found the corporate existence of appellant; the death of Joseph P. Megeath; the appointment of the appellant as executor of the last will and testament of the deceased.The trial court in substance, further found that between the 17th day of October, 1913, and the 3d day of November, 1929, Joseph P. Megeath and C. W. Newton, plaintiff and respondent, engaged in various business enterprises such as acquiring, developing, and selling oil lands and stock, acquiring, building on, and improving real estate, acquiring, operating, and owning interest in the manufacture of candy, acquiring and operating farm lands, and in the sale and disposition of such property; that in the dealings in and relating to such property and business it was by said parties mutually agreed that each should own one-half and would pay one-half the expense of operation and the purchase price when acquired; that such business, dealing, and relationship, as well as loaning money one to the other, continued until the death of Joseph P. Megeath; that said deceased became indebted to plaintiff for moneys advanced and for the use and benefit of Joseph P. Megeath in excess of the moneys advanced by said Megeath "upon an open, mutual and running account" during the whole of said term; that after the death of Joseph P. Megeath on or about March 3, 1930, plaintiff within proper time presented his claim to the executor, in writing as required by law; that said claim was rejected by the executor of said estate, defendant herein.

The findings then make reference to the verified claim, and said claim is made a part of the findings, and after finding that certain items have not been proved, the trial court also finds and makes deductions therefrom and determines the balance due and owing to the plaintiff, and renders judgment for such sum.

The court further found negatively that the relations and transactions were not separate and distinct transactions as alleged by the defendant, but constituted a joint business, concerning which there had never been determined a balance, and that no part of the claim found by the court was barred by the statute of limitations pleaded by defendant.The court further found that the notes executed by the Franklin Motor Car Company and Charles W. Newton had all been paid by plaintiff Newton and credited upon the account presented by him.

As heretofore indicated, appellant herein has assigned errors.In appellant's argument the assigned errors are grouped under designated headings and argued accordingly.It is urged:

(a) That the court erred in admitting in evidence certain exhibits designated as Exhibits 131 to 135, inclusive, and each of them, and further erred in refusing to strike them upon defendant's motion.This is admitted to be an action in equity, though partaking in a measure of the old form of assumpsit.

There is, as revealed by the pleadings and evidence, a thread of trust relationship running through the course of dealing between Newton, the plaintiff, and Megeath, the deceased, from the beginning of their business in 1913 till the death of Megeath.Suits on claims of this character proceed upon the equitable principles that underline an action for money had and received.Cases of this type are less restricted by technical rules than any other form of action.The trial court looks beyond the form and to the fundamental right and justice of the cause.United States v. Jefferson Electric Mfg. Co., 291 U.S. 386, 54 S.Ct. 443, 78 L.Ed. 859.

Except as corroborated by checks and the testimony of N.W. Clayton concerning matters that appear also in the Exhibits 131 to 135, inclusive, and incidental references and a general course of dealing covering a long period of time and furnishing a background of what occurred, those exhibits depend upon the testimony of Mrs. Newton.She testified that she was the wife of plaintiff and kept the books of the Franklin Motor Car Company;...