State v. Elsbury

• Decision Date: 21 December 1946
• Docket Number: 3452.
• Citation: 175 P.2d 430,63 Nev. 463
• Parties: STATE v. ELSBURY.
• Court: Nevada Supreme Court

175 P.2d 430

63 Nev. 463

STATE v. ELSBURY.

No. 3452.

Supreme Court of Nevada

December 21, 1946

Appeal from District Court, Fourth District, Elko County; Harry M Watson, Presiding Judge.

Robert Elsbury, also known as R. H. Elsbury, was convicted of grand larceny, and he appeals.

Reversed.

Taylor H. Wines and D. A. Castle, both of Elko, for appellant.

Alan H. Bible, Atty. Gen., George P. Annand and Homer Mooney, Deputy Attys. Gen., and A. L. Puccinelli, Dist Atty., of Elko, for respondent.

McKNIGHT District Judge.

Appellant was convicted of the crime of grand larceny. He has appealed from both the judgment and the order denying his motion for a new trial, and has assigned twelve alleged errors.

The information charged appellant with having stolen the sum of $1,000 from one S. L. Corsino.

The evidence shows that at the time of the alleged theft appellant and S. L. Corsino were general partners, engaged as such in operating a cafe, under written articles of partnership; that the sum of $1,000, admittedly taken and retained by appellant, constituted part of the proceeds from the business on deposit in the bank in a checking account in the firm name; and that the partnership was heavily in debt. It also shows that S. L. Corsino originally furnished the largest amount of the firm's capital.

The statute defining grand larceny reads as follows:

'Every person who shall feloniously steal, take, and carry away, lead or drive away, the personal goods or property of another, of the value of fifty dollars or more shall be deemed guilty of grand larceny, * * *.' Sec. 10323. N.C.L.

Under this statute it is essential that money which has been unlawfully taken and retained must be the 'property of another.' 36 C.J., page 756, sec. 74; 32 Am.Jur., Larceny, sec. 22; Burdick, Law of Crime, vol. 2, sec. 515.

But the State relies upon section 10339, N.C.L., which provides that:

'It shall be no defense to a prosecution for larceny * * * that the money or property appropriated was partly the property of another and partly the property of the accused.'

The important question to be decided, therefore, is whether this statute is applicable to a general partner who takes and retains partnership property during the existence of the partnership.

The title to partnership property is of a different class and with characteristics quite distinct from that of the title to property owned and held by individuals. Mattson v. Wagstad, 188 Wis. 566, 206 N.W. 865, 868.

Section 24 of the Uniform Partnership Act reads:

'The property rights of a partner are (1) his rights in specific partnership property, (2) his interest in the partnership, and (3) his right to participate in the management.' Sec. 5028.23, N.C.L. 1931-1941 Supplement.

By the statement that one of the property rights of a partner is his right in specific partnership property is meant simply that a partner, subject to any contrary agreement, has an equal right with his copartners to use or possess any partnership property for any proper partnership purpose. Lindley v. Murphy, 387 Ill. 506, 56 N.E.2d 832, 836.

Under section 25 of the Uniform Partnership Act, a partner is co-owner with his partners of specific partnership property holding as a tenant in partnership. The incidents of this tenancy are such that: A partner, subject to the provisions of the act and to any agreement between the partners, has an equal right with his partners to possess specific partnership property for partnership purposes, but cannot otherwise possess same without the consent of his partners. His rights in specific partnership property are not assignable except in connection with the assignment of rights of all the partners in the same property, nor are they subject to attachment or execution upon a personal claim against him. A partner cannot claim any right under the homestead or exemption laws when partnership property is attached for a partnership debt. On the death of a partner his right in specific partnership property vests not in the partner's personal representative but in the surviving partner. A partner's right in specific partnership property is not subject to dower, curtesy, or allowances to widows, heirs or next of kin. Sec. 5028.24, N.C.L. 1931-1941 Supplement.

Section 26 of the same statute specifically provides:

'A partner's interest in the partnership is his share of the profits and surplus, and the same is personal property.' Sec. 5028.25, N.C.L. 1931-1941 Supplement.

This was also true long prior to the passage of the act. Fourth National Bank of New York v. New Orleans & Carrollton Railroad Co., 11 Wall. 624, 20 L.Ed. 82, 83; Rossmoore v. Anderson, D.C.N.Y., 1 F.Supp. 35, 36; Savings & Loan Corporation v. Bear, 155 Va. 312, 154 S.E. 587, 75 A.L.R. 980, 991.

Joint ownership and part ownership of personal property are distinguishable from the relationship of partnership. St. Clair Lime Co. v. Ada Lime Co., 196 Okl. 29, 162 P.2d 547, 549; Jensen v. Wiersma, supra, 185 Iowa 551, 170 N.W. 780, 4 A.L.R. 298, 300; Brindle v. Hiatt, 8 Cir., 42 F.2d 212, 213; Childers v. Neely, 47 W.Va. 70, 34 S.E. 828, 49 L.R.A. 468, 81 Am.St.Rep. 777; Jones v. Pitcher, 3 Stew.& P., Ala., 135, 24 Am.Dec. 716, 731.

It is well settled that the property of a partnership belongs to the firm and not to the partners. Fourth National Bank of New York v. New Orleans & Carrollton Railroad Co., supra, 11 Wall. 624, 20 L.Ed. 82, 83; Krone v. Higgins, 195 Okl. 380, 158 P.2d 471, 472; Jensen v. Wiersma, supra, 185 Iowa 551, 170 N.W. 780, 4 A.L.R. 298, 299; In re Prince's Estate, 141 Misc. 600, 252 N.Y.S. 908, 910, reversed on other grounds 238 A.D. 855, 262 N.Y.S. 785; Brinson v. Monroe Automobile & Supply Co., 180 La. 1064, 158 So. 558, 96 A.L.R. 1206, 1212; Windom National Bank of Windom v. Klein, 191 Minn. 447, 254 N.W. 602, 604; Commissioner of Internal Revenue v. Shapiro, 6 Cir., 125 F.2d 532, 144 A.L.R. 349, 353; 40 Am.Jur., Partnership, sec. 114, note 3; 47 C.J., page 781, note 2.

A partner has no individual property in any specific assets of the firm. Commissioner of Internal Revenue v. Shapiro, supra, 6 Cir., 125 F.2d 532, 144 A.L.R. 349, 353; In re Dumarest's Estate, 146 Misc. 442, 262 N.Y.S. 450, 452; Windom National Bank of Windom v. Klein, supra, 191 Minn. 447, 254 N.W. 602; 40 Am.Jur., Partnership, sec. 114, note 4; 47 C.J., page 781, note 4.

Instead, the interest of each partner in the partnership property is his share in the surplus, after the partnership debts are paid and the partnership accounts have been settled. Commissioner of Internal Revenue v. Shapiro, supra, 6 Cir., 125 F.2d 532, 144 A.L.R. 349, 353; Blodgett v. Silberman, 277 U.S. 1, 48 S.Ct. 410, 72 L.Ed. 749, 757; Breck v. Blair, 129 Mass. 127, 128; Swirsky v. Horwich, 382 Ill. 468, 47 N.E.2d 452, 453; Preston v. State Industrial Accident Commission, 174 Or. 553, 149 P.2d 957, 961; B. A. Lott, Inc. v. Padgett, 153 Fla. 308, 14 So.2d 669, 670; Fourth National Bank of New York v. New Orleans & Carrollton Railroad Co., supra, 11 Wall. 624, 20 L.Ed. 82, 83; Krone v. Higgins, supra, 195 Okl. 380, 158 P.2d 471, 472; Brindle v. Hiatt, 8 Cir., 42 F.2d 212, 213; Dixon v. Koplar, 8 Cir., 102 F.2d 295, 297; Savings & Loan Corporation v. Bear, supra, 155 Va. 312, 154 S.E. 587, 75 A.L.R. 980, 991; 47 C.J., page 780, note 99; 40 Am.Jur., Partnership, sec. 114, notes 6-7; Note 6 L.R.A. 740.

Until that time arrives, it cannot be known what property will have to be used to satisfy the debts and, therefore, what property will remain after the debts are paid. Brindle v. Hiatt, supra, 8 Cir., 42 F.2d 212, 213.

The amounts of money invested by the partners respectively in the firm would be no criterion in determining their ownership of the partnership property, for the partner who furnished in the first instance the largest amount of capital, on final settlement might be found to have no interest whatever in the assets then on hand. State ex rel. Billingsley v. Spencer, 64 Mo. 355, 27 Am.Rep. 244, 245.

When a partnership is admittedly insolvent, as was the partnership in the case at bar at the time of the alleged larceny, neither of the partners can possibly have any separate interest in the firm property. Spiro v. Paxton, 3 Lea.,Tenn., 75, 31 Am.Rep. 630; Hutzler Brothers v. Phillips, 26 S.C. 136, 150, 1 S.E. 502, 4 Am.St.Rep. 687, 695.

A partner's right in partnership property is a mere chose in action, and carries with it a right to an accounting. Blodgett v. Silberman, 227 U.S. 1, 48 S.Ct. 410, 72 L.Ed. 749, 757; In re Dumarest's Estate, supra, 146 Misc. 442, 262 N.Y.S. 450, 452; 47 C.J., page 781, note 6.

As each partner is the ultimate owner of an undivided interest in all the partnership property, none of such property 'Can be said, with reference to any partner, 'to be the property of another.'' State v. Eberhart, 106 Wash. 222, 179 P. 853, 854; Ex parte Sanders, 23 Ariz. 20, 201 P. 93, 17 A.L.R. 980, 981; State v. Reddick, 2 S.D. 124, 48 N.W. 846, 847, 8 Am.Crim.Rep. 204; Brill Cyclopedia Criminal Law, vol. 2, page 1294, note 9; 9 R.C.L. pages 1281, 1282, note 14; Note 14 Ann.Cas. 724.

In State v. Eberhart, supra, the Washington Supreme Court held that partnership property, under a statute identical with Sec. 10339, N.C.L., was not subject to larceny by one of the partners during the existence of the partnership. A contrary ruling was made by the Minnesota Supreme Court in State v. MacGregor, 202 Minn. 579, 279 N.W. 372. No. other cases construing the identical statute, or one similar thereto, have been found.

We are not in accord with the Minnesota decision. In that case the court simply assumed, without stating any good reason for such assumption, that each partner was a part-owner of the partnership...