Spaulding v. Stubbings

• Decision Date: 17 October 1893
• Citation: 56 N.W. 469,86 Wis. 255
• Parties: SPAULDING v. STUBBINGS ET AL.
• Court: Wisconsin Supreme Court

86 Wis. 255

56 N.W. 469

SPAULDING

v.STUBBINGS ET AL.

Supreme Court of Wisconsin.

Oct. 17, 1893.

Appeal from circuit court, Oneida county; Charles V. Bardeen, Judge.

Action by G. W. Spaulding against W. H. Stubbings and George E. O'Connor on an account and on a note. From a judgment in plaintiff's favor, defendant Stubbings appeals. Affirmed.

The other facts fully appear in the following statement by LYON, C. J.:

In 1888, Wilson H. Stubbings, one of the defendants, resided in Evanston, Ill., and owned and was carrying on a store for the sale of merchandise at Marinesco, Mich.; and John O'Connor was engaged in business in a store in Eagle River, Wis., where he resided. The nature of his business does not appear. Under date of August 8, 1888, at Eagle River, Stubbings and O'Connor made an agreement in writing, signed by Stubbings alone, the terms of which are as follows: “Agreement made between W. H. Stubbings and John O'Connor, this day and date, that the said W. H. Stubbings is to furnish the said John O'Connor such sums of money as may be agreed between them for the purpose of opening a general store, and is to receive for same interest at the rate of ten per cent. per annum for time it is in the business, payable semiannually; and the said John O'Connor is to give security on all moneys advanced. The interest is to be paid out of the business, also the expenses of running the store, after which the profits are to be equally divided between the said W. H. Stubbings and John O'Connor, which will be done semiannually, to wit, January 1 and July 1 of each year.” In part execution of such agreement to furnish money, Stubbings removed his stock of goods from Marinesco to Eagle River, and placed it in the store in which O'Connor was doing business, and the same became a part of the stock of merchandise in the general store mentioned in the agreement of August 8th, and was accepted by O'Connor as part performance by Stubbings of that agreement. Stubbings afterwards advanced to O'Connor divers sums of money on account of such business. April 10, 1889, Stubbings and O'Connor had an accounting of the value of the Marinesco stock, and of the further sums of money thus advanced, and thereupon they entered into another written agreement, of that date, which is as follows: “Memorandum of agreement made this tenth (10th) day of April, A. D. 1889, by and between John O'Connor, of Eagle River, Oneida county, state of Wisconsin, and Wilson H. Stubbings, of Evanston, Cook county, state of Illinois, witnesseth as follows: Whereas, the said O'Connor is now, and for some time has been, engaged in carrying on a general merchandise business in Eagle River, above named; and whereas, said Stubbings has heretofore loaned to said O'Connor $14,611.50, which he hereby agrees to allow to remain with said O'Connor for a period of five (5) years from May 1st, 1889: Now, therefore, in consideration of the above, the said O'Connor hereby covenants and agrees with said Stubbings to pay to him interest at the rate of ten (10) per cent. per annum on said sum of $14,611.50, (said sum, with interest thereon, being further evidenced by a note of even date herewith, between the parties hereto,) and also one-half (1/2) of the net profits arising from the aforesaid business conducted by said O'Connor. The net profits aforesaid shall include all the profits arising from said business after deducting all current expenses, including rent of store and clerk hire. And said O'Connor hereby agrees to keep a true and correct set of books, showing all the accounts and transactions of said business, which said books and accounts shall be open at all times for the inspection of said Stubbings or his agent. This agreement shall bind the parties hereto, their heirs and assigns. It is further agreed that during said term of five years the said stock of goods in said business shall not be sold out in bulk without the consent of both parties hereto.” At the same time O'Connor and his wife gave Stubbings their judgment note for the above sum of $14,611.50, payable five years after date, with 10 per cent. interest, payable annually, and executed a mortgage on certain real estate situate in Oneida county, Wis., to secure the payment of such note. The note contains a stipulation that, in case of any default in the payment of interest, the whole principal shall become due, at the option of Stubbings. The business thus inaugurated at Eagle River was carried on by O'Connor until July 4, 1889, when he died. After his death, and with the knowledge and active co-operation of Stubbings, the business was continued by the administrators of the estate of O'Connor, who were his wife and his son, George O'Connor, George having the sole management thereof, and Stubbings continued to advance money to carry it on. During the lifetime of John O'Connor, plaintiff sold him flour and other supplies to be used and disposed of in the business at Eagle River, and continued to make such sales to George O'Connor after the death of John, for the same purpose.

This action is against Stubbings and George O'Connor to recover an unpaid balance of $242.50, alleged to be due plaintiff on account for such supplies, and on a note given him by George O'Connor, as administrator, for a portion of such account for supplies. This note is for $451.49, and 8 per cent. interest. It is dated June 29, 1891, and is payable by its terms 60 days after date. If payments be applied to cancel the first items in the account, the whole of such balance, and the portion of the account for which the note was given, accrued after the death of John O'Connor. The action was brought on the theory that Stubbings was a partner in the business at Eagle River with John O'Connor, and that his liability as such continued after the death of John. The complaint charges that such partnership existed, which allegation Stubbings specifically denies in his answer, which also contains a general denial. George O'Connor did not answer. Extensive correspondence was carried on between Stubbings and John O'Connor, during his lifetime, and George O'Connor, after the death of his father, relative to the Eagle River business. Ninety letters thus written by Stubbings were read in evidence. The character of many of these letters is stated in the opinion. Only one of the letters written by either of the O'Connors to Stubbings is in evidence. It was written by George, who claimed therein that Stubbings was a partner in the business. The cause was tried without a jury, and the material facts found by the court, which relate more directly to the question of partnership, are as follows: “(1) That on the 8th day of August, 1888, the defendant W. H. Stubbings and one John O'Connor (father of the defendant George E. O'Connor) made and entered into an agreement in writing whereby, in substance, said Stubbings agreed to furnish said John O'Connor money for the purpose of opening a general store, and for which said O'Connor was to give security, and to pay ten per cent. interest semiannually out of the business, and, after paying the running expenses of the business, the profits of the business were to be equally divided between the said John O'Connor and the said defendant W. H. Stubbings; and thereupon and thereafter said merchandise business was conducted and...