Short v. Taylor

• Decision Date: 26 January 1897
• Court: Missouri Supreme Court
• Parties: SHORT v. TAYLOR.

38 S.W. 952

137 Mo. 517

SHORT v. TAYLOR.

Supreme Court of Missouri, Division No. 1.

January 26, 1897.

PARTNERSHIP — PLEADING — ACCOUNTING — RES JUDICATA.

1. Rev. St. § 2303, directing that a judgment be not reversed unless the reviewing court believe there was material error, applies to decrees in equity.

2. Rev. St. § 2186, providing that, where plaintiff or defendant sue or are sued as partners, it shall not be necessary to prove the partnership, unless denial thereof is verified, does not apply to a suit by one individual against another, charging a partnership relation between them.

3. Where T. sued W. and L. by separate actions, W. as co-surety on a note which T. had paid, and L. as principal, and both set up as defense that T. and L. were partners, and that the note was a firm note, and L. further pleaded that there had not been a partnership settlement, and it was stipulated that the action against L. should abide that against W.; and, there being verdict and judgment for W., judgment was rendered for L. reciting the stipulation and judgment for W., and that, in accordance therewith, the court found the issues for L., and that L. and T. "were partners," and T. "is not entitled to recover in an action of law" against L. on account of the payment of the note, and ordering that T. take nothing by the action, and that L. recover his costs, — such judgment is not a bar to a suit by L. against T. for settlement of partnership account.

4. Nor is such judgment res judicata as to when the partnership began, or as to the terms thereof.

5. Defendant in a suit for partnership accounting, having denied the partnership, and failed to take steps to put at the disposal of the firm land belonging to it, but standing in his name, is properly treated as electing to retain the property, and therefore may be charged with the value of the partner's share thereof.

6. That plaintiff gave notes to defendant, secured by trust deed, on certain property, does not preclude plaintiff from showing that the property belonged to them as partners, and that the notes and trust deed were but part of the agreed plan between them to put the ostensible title in plaintiff, while defendant was to be a dormant partner.

Appeal from circuit court, Saline county; Richard Field, Judge.

Suit by L. D. Short against William M. Taylor. Judgment for plaintiff, and defendant appeals. Affirmed.

Draffen & Williams and Saml. Boyd, for appellant. Samuel Davis and Leslie Orear, for respondent.

BARCLAY, J.

The case is for an account between the parties to the suit as partners, and for judgment for plaintiff's share. The defenses consist of a denial of the alleged partnership, and a plea of a former adjudication of plaintiff's claim. The cause went (without objection) to referees for trial of all the issues and a statement of the account. The plaintiff's testimony tended to prove that in 1882 the defendant, Mr. William M. Taylor, and Mr. Holmes, were partners and owners of a flour mill in Saline county; that, about the last of February of that year, plaintiff, Mr. L. D. Short, purchased the interest of Holmes, and entered into equal partnership with defendant, in the same enterprise. The former owners made a deed of the property outright to plaintiff, who gave back to Mr. Taylor three notes, of $500 each, payable at intervals of a year, and secured by deed of trust on the mill property. One of the terms of the partnership, according to plaintiff's version, was that the business should go forward in the name of plaintiff, and that the defendant should not be known to the public as a partner. The defendant denies the partnership; but (for reasons that will appear later) it is not necessary to set forth the evidence on either side bearing on that issue. The mill was conducted for a number of years under the arrangement described by plaintiff. During that time a variety of monetary dealings occurred between plaintiff and defendant, as well as between plaintiff and outside parties treating with him in regard to the firm's affairs. In 1888 defendant brought two actions, on the proceedings of which the plea of res judicata in this case is based. The first of those actions was begun by Mr. Taylor against Mr. W. H. Short, a brother of plaintiff. W. H. had signed a note for $350, along with Mr. Taylor, as ostensible surety for the maker, L. D. Short. Mr. Taylor had been obliged to pay the note, and the action mentioned was brought to recover of Mr. W. H. Short, as co-surety, one-half of the sum so paid by Mr. Taylor. The defense interposed to that action was that Messrs. Taylor and L. D. Short were partners at the time when the note was given, and that it was executed for account of the firm. That defense was denied. Defendant also set up a counterclaim. Before this action came to trial, a stipulation was filed in the other (the second) case, by which it was agreed that the latter should abide the result of the first. The second action was directly between Mr. Taylor, as plaintiff, and Mr. L. D. Short, as defendant. It was intended to recover of the latter the money which had been paid by Mr Taylor to take up the same note that figured in the other action (wherein Mr. W. H. Short was the defendant). The answer in the second action (as in the first) charged that the note was really a firm note of plaintiff and defendant, though issued in the name of Mr. L. D. Short alone. The answer further went on to a close as follows: "At the time said note was given, plaintiff and defendant were partners, engaged in running a mill at Herndon, Saline county, Mo., and in buying grain for the purpose of making flour and meal for sale, and that said note was given for partnership purposes, and for money used by them in carrying on the business of said partnership; that there has never been a settlement of the affairs of said partnership between plaintiff and defendant, but that, upon a full settlement of said partnership, plaintiff will be largely indebted to this defendant; that on account of the number of transactions to be settled, and the various matters to be examined, this defendant is unable to here state an account between himself and plaintiff. Defendant therefore prays this court to appoint a referee to state an account between plaintiff and defendant, and to settle said partnership, and for all such other orders as may be necessary in the premises." To this answer there was a reply, denying generally the new matter, and especially the alleged partnership. The latter denial was verified. The first of these actions resulted in a verdict and judgment for defendant, including an affirmative finding for defendant on the counterclaim. Then the stipulation in the second case was called into play, and the following judgment thereon was rendered, February 16, 1889, viz.: "William M. Taylor, Plaintiff, vs. L. D. Short, Defendant, to wit: Now come the parties hereto, by their...