Priest v. Chouteau

• Decision Date: 31 October 1884
• Citation: 85 Mo. 398
• Parties: PRIEST, Appellant, v. CHOUTEAU.
• Court: Missouri Supreme Court

85 Mo. 398

PRIEST, Appellant,

v.CHOUTEAU.

Supreme Court of Missouri.

October Term, 1884.

Appeal from St. Louis Court of Appeals.

AFFIRMED.

A. J. P. Garesche for appellant.

(1) There was no partnership between DeBar, Chouteau and Mrs. Wakefield. In this state a mere division of profits does not constitute a partnership. McCauley v. Cleveland, 21 Mo. 439; Gwinn v. Rooker, 24 Mo. 292; Johnson v. Hoffman, 53 Mo. 505; Campbell v. Dent, 54 Mo. 325; Donnell v. Harshe, 67 Mo. 173; Musser v. Brink, 68 Mo. 249. (2) Even if the partnership existed the leasehold was not partnership property. Except in the inventory by Mr. Chouteau it was always treated as property in common, not as partnership property. That property even bought for a partnership, and used for it, may nevertheless be held only as property in common, See McDermott v. Lawrence, 7 S. & R. 442; Coles v. Coles, 15 John. 160; Forde v. Herron, 4 Munf. 322; Frink v. Branch, 16 Conn. 270; Polk v. Buchanan, 5 Sneed, 721; Webb v. Leggett, 6 Mo. App. 347. And where, as in this case, the conveyances are to individual members, the property cannot by parol be converted into partnership property. Hale v. Herne, 2 Watts, 143; Lancaster Bk. v. Higley, 13 Pa. St. 550; Otis v. Sill, 8 Barb. 122; Bird v. Morrison, 12 Wis. 155. (3) Chouteau was not a competent witness. Stanton v. Ryan, 41 Mo. 510; Johnson v. Quarles, 46 Mo. 429; Kellogg v. Malin, 62 Mo. 432; Angell v. Hester, 64 Mo. 144. Weiland v. Weiland, 64 Mo. 169; Sitton v. Shipp, 65 Mo. 305; Ring v. Jameson, 66 Mo. 427. (4) But if the leasehold was partnership property, the plaintiff was an innocent purchaser. Kerr on Fraud and Mistake, 253-4. (5) DeBar having shared in the proceeds of the money raised by the deed of trust, his associates are estopped to contest the deed. Lutzweiler v. Lachman, 23 Mo. 168.

Hermann & Reyburn for respondent.

(1) The arrangements existing between DeBar, Chouteau and Mrs. Wakefield, constituted a partnership. Parsons on Part. (3 Ed.) 44, 50, 62; Long v. Smith, 48 Mo. 277; Myers v. Field, 37 Mo. 440; Maclay v. Freeman, 48 Mo. 234; Bond v. Pittard, 3 M. & W. 357; Clagett v. Kilbourne, 1 Black, 346. (2) The leasehold was partnership property. Clagett v. Kilbourne, 1 Black, 346; Dupont v. McLaren, 61 Mo. 508; Acley v. Stahlin, 56 Mo. 560; Carlisle v. Mulhern, 19 Mo. 56; Divine v. Mitchum, 4 B. Monroe, 488; Hewitt v. Sturdevant, 4 B. Monroe, 453; Winslow v. Chiffele, 1 Harper's Eq. 25; Duryea v. Burt, 28 Cal. 569; Matlock v. James, 13 N. J. 126; Dyer v. Clark, 5 Met. 562; Burnside v. Merrick, 4 Met. 537. (3) The defendant was a competent witness.

EWING, C.

Plaintiff commenced an action of ejectment in the circuit court of St. Louis against the defendant to recover possession of the undivided half of a leasehold estate in the property known as “Debar's Grand Opera House.” The answer sets up that on the fifteenth of June, 1877, and prior thereto defendant, Ben DeBar, and Alice Wakefield, through her trustee, Taylor, were partners under the style of “DeBar's Grand Opera House,” engaged in the business of running and managing a theatre on the premises, which was partnership property and used as such. That they were interested in said property and business as follows: DeBar one-half, defendant one-sixth, and Alice Wakefield one-third. That on the fifteenth of June, 1877, DeBar gave a deed of trust on his undivided half to secure a debt due by DeBar individually to John G. Priest; and plaintiff claims under a deed from the trustee, by virtue of a sale under this deed of trust. That on August 26, 1877, DeBar died, and defendant, by request of Priest and Mrs. Wakefield, and under an order of the probate court, was appointed as administrator of the partnership effects as surviving partner; that, as such, by order of court, he sold the interest of DeBar in the opera house; that one Jno. W. Norton became the purchaser, and to whom the possession was delivered. That the entire partnership property was insufficient to pay the debts of the firm. That Jno. G. Priest, on the fifteenth of June, 1877, and plaintiff, Frederick R. Priest, had notice of the fact that said leasehold was partnership property belonging to and used by said firm in the prosecution of their business.

Both parties claim through Ben DeBar. The property was a leasehold, the term expiring on the first day of January, 1882, and was the property known as the ““Grand Opera House,” in the city of St. Louis. On the thirteenth of May, 1873, DeBar acquired this leasehold from Truman Martin and wife, and on the twenty-third day of May, 1873, a contract was entered into between DeBar and the trustee of Alice L. Wakefield, she being a married woman, by which said Alice was to acquire a one-third interest in said theatre property and its profits. The agreement is in the following words: “This memoranda of agreement made and entered into this twenty-third day of May, A. D. 1873, by and between Benedict DeBar and Daniel G. Taylor, trustee for Mrs. Alice Wakefield, witnesseth: That in consideration of three thousand, three hundred and thirty-three dollars and thirty-three cents in cash paid, and the payment of the additional sum of ten thousand dollars, for which a promissory note has this day been given, it is agreed by Ben DeBar that said Daniel G. Taylor, as such trustee, shall have one-third of all the profits derived from the Grand Opera House property on Market street, the same to be managed and controlled by said Ben DeBar as exclusively as though owned by him during the continuance of the leasehold estate purchased by said Ben DeBar from Truman Martin and wife; all profits to be accounted for by said Ben DeBar on the first day of each month; and the one-third of the profits of the previous month, less twenty-five per cent. to be reserved to meet any losses that may occur, to be paid to said Taylor, as such trustee; such twenty-five per cent. so reserved to be carried to the account of the next month following; and when the said note of ten thousand dollars is paid according to the tenor thereof, then a one-third of the building and property mentioned and referred to shall be by deed conveyed to said Daniel G. Taylor, as such trustee; but the management of said premises shall continue in like manner as herein set forth, and in the event that said note for ten thousand dollars is not paid when due, the title to said property to fully remain in said DeBar, released from all claim and interest of said Taylor, as such trustee, and until the payment of said note the profits to be retained by said DeBar to be applied upon said note; and in the event of a failure to pay said note when due, one-half of the $3,333.33 1/3 this day paid shall be repaid to said Taylor as such trustee, and the balance shall be, with all interest of said Taylor as such trustee hereunder, forfeited to said Ben DeBar and forever terminated.

BEN. DEBAR,

[L. S.]

DAN'L G. TAYLOR,

[L. S.]

Trustee of Alice L. Wakefield,

[L. S.]”

The deferred payments mentioned in the agreement were paid out of the profits of the theater, and a deed was executed to the trustee of the said Alice on or about the twenty-sixth of April, 1875, conveying said one-third interest. Another deed covering the same purchase was made between these parties, dated December 13, 1873. Both deeds convey this same interest, subject to the provisions of said agreement; and in both deeds John G.Priest executes the conveyance as attorney in fact of Harriet, the wife of Ben DeBar. Both deeds were duly recorded; the former on the thirtieth of April, 1875, the latter on December 15, 1873.

By deed dated December 15, 1873, DeBar and wife conveyed to Charles P. Chouteau, defendant in this action, an undivided one-sixth interest in the same property; the deed contains the following provision: “This conveyance, however, being subject to the terms and conditions of a certain contract made between the parties hereto on the twenty-third day of May, 1873, which contract is in its terms and provisions similar to a certain other contract of same date between Benedict DeBar and Daniel G. Taylor, trustee of Alice Wakefield.” This deed, too, is executed by John G. Priest, as attorney in fact, of Harriet DeBar, on the nineteenth day of September, 1873, and is duly recorded. “That Ben DeBar, D. G. Taylor, as trustee of Mrs. Alice B. Wakefield, and Charles P. Chouteau, in the month of May, A. D. 1873, each acquired an undivided interest in the leasehold premises in controversy herein, said interests being respectively one-half, one-third, and one-sixth, and that said leasehold consisted of a theatre building and all the furniture, scenery and properties therein contained. That said building, furniture, etc., was acquired, as aforesaid, for the express purpose of being operated as a theatre, by the parties above named, for their mutual benefit and profit, under the management of Ben DeBar; and the same was so operated from May, 1873, until August, 1877, when said DeBar died. That said business, during the period last specified, by agreement of said parties, was conducted by said parties in the following manner: Books of account were kept by Ben DeBar in the name of ‘DeBar's Grand Opera House,’ wherein were entered all the receipts and expenses of the business conducted therein, including the groundrent of said leasehold; and at the end of each theatrical season the net profits were divided among the three partners above named in the proportions of one-half, one-third, and one-sixth; but that at the end of each year twenty-five per cent. of the net profits accruing to each party, as aforesaid, were set apart and carried forward to the account for the succeeding year for the purpose of meeting any loss that might be sustained during such season. Transcripts of such accounts were furnished each year by said DeBar to Taylor, trustee, and Chouteau, and said books of account were frequently examined in behalf of Mrs. Wakefield, and occasionally by...