Perkins v. Butler Cnty.

CourtSupreme Court of Nebraska
Citation62 N.W. 308,44 Neb. 110
Decision Date20 February 1895
PartiesPERKINS ET AL. v. BUTLER COUNTY ET AL.

44 Neb. 110
62 N.W. 308

PERKINS ET AL.
v.
BUTLER COUNTY ET AL.

Supreme Court of Nebraska.

Feb. 20, 1895.



Syllabus by the Court.

[62 N.W. 308]

1. An assignment of moneys not yet earned, but expected to be earned in the future, under an existing contract, is in equity valid and enforceable.

2. When a partnership is dissolved, and is insolvent, its assets will be treated by a court of equity as a trust fund for the payment of partnership creditors, and the creditors of one partner will not be permitted to divert the assets to the prejudice of the partnership creditors.

3. A. and B. were partners, and had a contract for the construction of a courthouse for Butler county. During the progress of the work, the partnership was dissolved, it being agreed that A. should complete the courthouse, and receive for himself any profits accruing thereon. He gave a bond to B. to indemnify

[62 N.W. 309]

B. against liabilities arising out of the courthouse contract. B. agreed that A. might use the firm name in completing the courthouse. Thereafter A. borrowed money which he used in completing the courthouse. The money was borrowed on a note signed by A. individually, and endorsed by C. and D. To secure them, A. made in the firm name an order upon the county directing the payment to C. and D. of 15 per cent. of the contract price, which was by the contract reserved until the courthouse was finished. It did not appear that C. and D. indorsed the note on the credit of the firm of A. and B., or on the faith that the money would be used in the building. Thereafter A. and B. gave orders against the same fund to various persons who had performed work or furnished material for the building. C. and D. were compelled to pay A.'s note. Held, that the finding of the trial court that the debt from A. to C. and D. was the individual debt of A. was in accordance with the evidence; that, as between A. and B., the county, and laborers and material men, the fund was partnership assets; and that the laborers and material men were entitled to be paid therefrom prior to C. and D.


Appeal from district court, Butler county; Wheeler, Judge.

Suit by B. O. Perkins and Lewis Spelts against the county of Butler and others to obtain payment of a certain portion of a fund due on a contract for the building of a courthouse. Certain persons intervened. From a decree adverse to their claim, plaintiffs appeal. Affirmed.

Geo. P. Sheesley R. S. Norval, Geo. W. Lowley, and Leese & Stewart, for appellants.

Steele Bros., Evans & Hale, M. A. Hall, and Frick & Dolezal, for appellees.


IRVINE, C.

In 1889, William J. Chidester and C. F. Barras were copartners under the name of Chidester & Barras. In that year they entered into a contract with Butler county for the construction of a courthouse, for which they were to receive $47,700. The contract provided for the payment to Chidester & Barras, each month, of 85 per cent. on materials furnished and labor performed during the month, the remaining 15 per cent. to be paid after the work was completed. Some time after this contract was entered into work was begun on the courthouse, and continued by Chidester & Barras until October 22, 1890, when the copartnership was dissolved. The terms of the dissolution were evidenced by several instruments. By one of these Barras agreed that if Chidester should give him a good and sufficient bond to hold him harmless against all loss or damage for which Chidester & Barras might become liable for any failure, fraud, or neglect upon their part in and about the construction of the courthouse, or for any loss for work, labor, or material furnished, or for any failure on the part of Chidester to pay for labor or material used in the construction of the courthouse, then Barras would waive all claims for any profit which might accrue in the construction of the courthouse; and Barras further agreed “that the said Chidester shall use the firm name in and about the construction of said courthouse.” Another instrument is the bond referred to. A third instrument is an agreement of dissolution, whereby all unsettled business was to be settled as soon as practicable, and the profits or loss shared equally, and Chidester, in consideration of the relinquishment by Barras of all claims to any profit arising from the courthouse contract, was to obtain an additional surety on the indemnity bond to Barras. Another instrument is a notice of dissolution signed by both partners, and published at the time. This notice recited that the courthouse contract was to be carried out by Chidester; that he was authorized to receive all payments, and that he was responsible for all bills for labor and material performed and furnished; and that Chidester was to use the firm name to complete the building, and Barras was not to use the firm name in any future transactions. A still further instrument is a receipt by Barras from Chidester for $150, in full for all claims on the courthouse contract.

From these instruments it is clear that it was the intention of the parties to effect a dissolution as of October 22, 1890, so far as practicable; that Barras received $150 in lieu of other demands on account of the courthouse, and Chidester undertook to indemnify him from liability on account of that contract. It is also clear that between the partners it was understood that Chidester should proceed alone with the work. But it is equally clear that Chidester and Barras recognized the fact that, as to third persons, their existing contract liabilities could not be affected, and so it was expressly agreed that Chidester might use the firm name in the fulfillment of the courthouse contract. Chidester proceeded with the work, and in December induced Perkins & Spelts, the plaintiffs, to sign, as joint makers with him, a promissory note, to the order of the Columbia National Bank of Lincoln, for $4,000. This note was discounted by the bank, and the proceeds placed to Chidester's credit individually, and not to the credit of Chidester & Barras. Chidester testifies that his object in obtaining this money was to use it on the courthouse contract, and the evidence shows that nearly all of it was so used. At the time this note was made, Chidester delivered to Perkins & Spelts the following instrument: “To the Honorable Board of Supervisors and County Treasurer of Butler County, Nebraska: Please pay to B. O. Perkins and L. Spelts all of the fifteen per cent. now due, and which will be due, us on the courthouse contract, and this shall be your receipt for same; said 15 per cent. being $7,155.00. Dated at David City, Neb., this 9th day of Dec., in the year 1890. Chidester & Barras, by W. J. Chidester.”

It does not appear that there was any agreement between Chidester and the plaintiffs

[62 N.W. 310]

that the money should be used for the courthouse, nor that they supposed that they were dealing with the firm of Chidester & Barras in signing the note. It does not even appear that they were informed what Chidester's purpose was in procuring the loan. The most that can be said is that Perkins, at least, evidently relied largely on the assignment of the 15 per cent. reserve fund to secure him in his suretyship. This note was once or twice renewed, and was finally, on July 6, 1891, paid by Perkins & Spelts. On December 30, 1890, Perkins & Spelts had filed the assignment with the county clerk of Butler county. The courthouse was completed and accepted about May 28, 1891, and there was found to be due from the county to Chidester & Barras $8,344.82. At the time the work was completed a number of...

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14 practice notes
  • Salem Trust Co v. Manufacturers Finance Co, No. 74
    • United States
    • United States Supreme Court
    • February 18, 1924
    ...Bank v. Hewitt, 3 Iowa, 93, 102, 66 Am. Dec. 49; Lumber Co. v. Newcomb, 79 Miss. 462, 466, 30 South. 608; Perkins v. Butler County, 44 Neb. 110, 116, 62 N. W. 308. 6 In Ward v. Duncombe, Lord McNaghton said (page 391): 'The general principle applicable to all equitable titles is, I think, w......
  • State Bank of Wheatland v. Bagley Bros., 1708
    • United States
    • United States State Supreme Court of Wyoming
    • May 10, 1932
    ...v. Chicago R. I. & P. R. R. Co., (Ia.) 3 N.W. 522; Railway & Navigation Co. v. Warriner, (Fla.) 16 So. 898; Perkins v. Butler Co., (Nebr.) 62 N.W. 308; Lumber Co. v. Bradler, (Ky.) 29 S.W. 313; Whitesall v. Pioneer Construction Co., 2 S.W. (2nd) 147; Wood v. Todd, 251 F. 530; Weiss v. Hamil......
  • First Nat. Bank of Aberdeen v. Monroe County, 22517
    • United States
    • United States State Supreme Court of Mississippi
    • April 2, 1923
    ...Perkins v. Butler Co. [131 Miss. 850] (1895), in 2 Am. & Eng. Dec. Eq. (a precisely similar case) at page 212, 2 Am. & Eng. Dec. Eq. 310, 62 N.W. 308, the rule is thus stated: 'In determining priorities between different assignments of this character, the general [95 So. 731] rule is that t......
  • Fremont Foundry & Mach. Co. v. Saunders Cnty., No. 30462.
    • United States
    • Supreme Court of Nebraska
    • April 7, 1939
    ...that part which holds that a mechanics' lien cannot be had, but that suit may be had upon the bond. The case of Perkins v. Butler County, 44 Neb. 110, 62 N.W. 308, 310, involves a situation distinctly similar to the one at bar. In that case, Butler county contracted with a partnership for t......
  • Request a trial to view additional results
14 cases
  • Salem Trust Co v. Manufacturers Finance Co, No. 74
    • United States
    • United States Supreme Court
    • February 18, 1924
    ...Bank v. Hewitt, 3 Iowa, 93, 102, 66 Am. Dec. 49; Lumber Co. v. Newcomb, 79 Miss. 462, 466, 30 South. 608; Perkins v. Butler County, 44 Neb. 110, 116, 62 N. W. 308. 6 In Ward v. Duncombe, Lord McNaghton said (page 391): 'The general principle applicable to all equitable titles is, I think, w......
  • State Bank of Wheatland v. Bagley Bros., 1708
    • United States
    • United States State Supreme Court of Wyoming
    • May 10, 1932
    ...v. Chicago R. I. & P. R. R. Co., (Ia.) 3 N.W. 522; Railway & Navigation Co. v. Warriner, (Fla.) 16 So. 898; Perkins v. Butler Co., (Nebr.) 62 N.W. 308; Lumber Co. v. Bradler, (Ky.) 29 S.W. 313; Whitesall v. Pioneer Construction Co., 2 S.W. (2nd) 147; Wood v. Todd, 251 F. 530; Weiss v. Hamil......
  • First Nat. Bank of Aberdeen v. Monroe County, 22517
    • United States
    • United States State Supreme Court of Mississippi
    • April 2, 1923
    ...Perkins v. Butler Co. [131 Miss. 850] (1895), in 2 Am. & Eng. Dec. Eq. (a precisely similar case) at page 212, 2 Am. & Eng. Dec. Eq. 310, 62 N.W. 308, the rule is thus stated: 'In determining priorities between different assignments of this character, the general [95 So. 731] rule is that t......
  • Fremont Foundry & Mach. Co. v. Saunders Cnty., No. 30462.
    • United States
    • Supreme Court of Nebraska
    • April 7, 1939
    ...that part which holds that a mechanics' lien cannot be had, but that suit may be had upon the bond. The case of Perkins v. Butler County, 44 Neb. 110, 62 N.W. 308, 310, involves a situation distinctly similar to the one at bar. In that case, Butler county contracted with a partnership for t......
  • Request a trial to view additional results

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