State ex rel. Appleman v. Lake Circuit Court, 28976

• Decision Date: 04 December 1952
• Docket Number: No. 28976,28976
• Parties: . Supreme Court of Indiana
• Court: Indiana Supreme Court

Page 898

108 N.E.2d 898

231 Ind. 378

STATE ex rel. APPLEMAN v. LAKE CIRCUIT COURT et al.

No. 28976.

Supreme Court of Indiana.

Dec. 4, 1952.

J. H. Sachs and Jay E. Darlington, Hammond, for appellant.

Alfred H. Highland, Hammond, Peters & Highland, Hammond, of counsel, for appellees.

EMMERT, Chief Justice.

This is an original action for a writ of prohibition. We issued a temporary writ prohibiting the Lake Circuit Court and a special judge thereof in Cause No. 35546 entitled Joseph Engelcoff v. Lester Appleman from exercising further jurisdiction therein until further order.

In 1937 George Engelcoff and Lester Appleman entered into a partnership for the business of selling at wholesale and retail petroleum products under the firm name of Preferred Oil Company. On June 7, 1952, the relator Appleman commenced an action in the Lake Circuit Court against his partner George Engelcoff for the specific performance of a memorandum agreement executed the early part of April, 1952, by which the parties agreed that the partnership would stand dissolved as of the 15th day of March, 1952, and that Engelcoff would sell his interest therein to the relator. The written agreement is set out as an exhibit to the complaint for specific performance. The venue of the cause was changed to the Porter Circuit Court, where it is now pending on a demurrer for want of facts to an amended complaint.

On the 9th day of August, 1952, Engelcoff commenced an action against the relator in the Lake Circuit Court, being Cause No. 35546, for a judgment dissolving the partnership, an accounting, and the appointment of a receiver to dispose of the partnership property, and for all other proper relief. To this complaint the relator filed an answer in abatement, which in substance alleged the pendency of the action for specific performance in the Porter Circuit Court and that the jurisdiction of the entire matter was before the Porter Circuit Court. To this answer in abatement the plaintiff filed a demurrer which was sustained.

The contract which was the foundation of the action for specific performance recited the existence of the partnership, that the partners agreed to a dissolution, that the continuing partner should purchase from the retiring partner all of his right, title and interest in the partnership, that 'this short form of memorandum agreement for dissolution be drafted pending the adjustments of all details and the execution of a detailed dissolution agreement.' The body of the contract in substance stated the agreement between the partners that the partnership be dissolved as of the 15th day of March, that the continuing partner pay the retiring partner the sum of $80,000 for the retiring partner's right, title and interest in and to the property and assets of the Preferred Oil Company, said payment to be made by (a) a transfer of title to a Gary building at a valuation of $20,000, and (b) $60,000 by promissory notes payable in five years and forty weeks from the date of dissolution, at the rate of $200 or more per week, drawing 5% interest per annum, said notes to be secured by certain chattel mortgages on personal property and equipment of the Preferred Oil Company, a real estate mortgage on real estate held by the continuing partner, the assignment of rents and profits by the continuing partner plus an assignment of all interest in real estate in which the continuing partner might have an interest as continuing partner. The continuing partner also promised to secure a policy of life insurance payable to the retiring partner on the life of the continuing partner in the amount to be agreed upon. ¹ The continuing partner also promised to assume all liabilities existing or hereafter created by reason of the operation of the Preferred Oil Company. The retiring partner agreed that all profits past and future should belong to the continuing partner and the continuing partner agreed to indemnify the retiring partner from certain federal income taxes stated in the agreement. Both parties agreed that the withdrawal of funds of the partnership since January 1, 1952, should be equalized as of March 15, 1952. The two remaining paragraphs of the memorandum agreement are as follows:

'5. It is contemplated that the parties will negotiate for a lease of the Gary property by retiring partner to the continuing partner.

'6. It is agreed that this agreement is a memorandum agreement only and does not include in a detailed manner all of the terms of the dissolution agreement subsequently to be negotiated, drafted and executed. It is contemplated that the final dissolution agreement shall be made pursuant to the terms of this agreement and shall include in addition such terms as are ordinarily included in a dissolution...