Van Heuvel v. Roberts

• Decision Date: 13 March 1930
• Docket Number: 1 Div. 549.
• Citation: 221 Ala. 83,127 So. 506
• Parties: VAN HEUVEL v. ROBERTS.
• Court: Alabama Supreme Court

127 So. 506

221 Ala. 83

VAN HEUVEL v. ROBERTS.

1 Div. 549.

Supreme Court of Alabama

March 13, 1930

Rehearing Denied April 17, 1930.

Appeal from Circuit Court, Mobile County; Saffold Berney, Judge.

Bill for discovery, accounting, etc., by Isham T. Roberts against Martin Van Heuvel. From a decree for complainant, respondent appeals.

Affirmed.

Joint adventurer, purchasing note distributed to coadventurer and lost by him because of foreclosure of pledge, held required to account to joint enterprise for benefits received.

The following is the letter referred to in the opinion:

"Mobile Alabama, July, 1924.

"McGowin-Foshee Lumber Company, Falco, Alabama.

"Identified C. A. Strain 3/22/27

"Gentlemen: In connection with the sale and conveyance to you of approximately 40,225 acres of land in Manatee County, Florida, evidenced by deed to you made by Martin Van Heuvel and Grace Van Heuvel and Florida A. Roberts and I. T. Roberts, dated June 30th, 1924, but finally acknowledged and delivered only contemporaneously herewith, which deed recites the payment of $225,000.00 in cash on account of the purchase price, we instruct that the said $225,000.00 be paid out by you to the following parties and in the following amounts, namely:

Manatee Naval Stores Company for principal of note due June 3rd,

1924 ........................................................... $100,000.00

Manatee Naval Stores Company for interest on said note from June

3rd, 1924, to July 16th, 1924 ........................................ 825.60

Martin Van Heuvel for W. C. Wood Lumber Company ..................... 59,104.00

George A. Leftwich on account of purchase from him ................... 5,000.00

First National Bank of Mobile to take up drafts drawn on Martin

Van Heuvel by K. I. McKay ......................................... 25,770.32

Merchants Bank of Mobile to take up draft drawn by attorneys

Toomer and the firm of Johnson & Garrett ........................... 4,000.00

I. T. Roberts, and Martin Van Heuvel (for Vaughan) ................... 2,500.00

I. T. Roberts, and Martin Van Heuvel (for Turner) ................... $2,500.00

I. T. Roberts and Martin Van Heuvel ................................. 20,142.09

Retain on account of our liability on 1924 taxes ..................... 4,637.09

Retain for revenue stamps on deed to you ............................... 520.00

"These payments aggregating the aforesaid sum of $225,000.00 leave $579,500.00 of the consideration for said land unpaid. As against this last named amount you have assumed and agreed to pay Manatee Naval Stores Company our notes to it aggregating $283,179.40, with interest thereon at 6% per annum from June 3rd, 1924, which obligations are secured by a first mortgage on the land which you are purchasing, and you have also assumed and agreed to pay our further obligations to the said Manatee Naval Stores Company aggregating $2,331.80 secured by a second mortgage on the said land. These two items aggregate $285,511.20, which being deducted from the aforesaid balance of $579,500.00 leaves $293,988.80 for which you are giving your thirty-seven promissory notes secured by a mortgage of even date herewith, executed by you to us, which mortgage fully describes the said thirty-seven notes. We hereby acknowledge the receipt from you of all of said notes and we have endorsed and are now herewith returning to you certain of them to be used in the following manner and for the following purposes:

"The eleven Class A notes for $10,000.00 each shall be placed with the Merchants Bank as Trustee as collateral security for the same number of notes, for the same amounts and with the same maturities, executed by the undersigned Martin Van Heuvel to W. C. Wood Lumber Company, of Collins, Mississippi, under date of July 14th, 1924.

"In the deed made by us and our wives to W. C. Wood Lumber Company under date of May 12th, 1923, a vendor's lien was reserved to secure the payment of five notes for $10,000.00 each, and two notes for $17,680.85 each, executed to our order by the said W. C. Wood Lumber Company. These notes are to be handled in the following manner: Upon paying the above mentioned drafts now in the First National Bank of Mobile, Alabama, one of said notes for $17,680.85 will be received and your attorney T. M. Stevens is authorized to cancel the same and deliver it to the said W. C. Wood Lumber Company. However, the six months interest on said note which matured June 3rd, 1924, is to be collected and paid over to the undersigned I. T. Roberts. One of said $10,000.00 notes received and used by Martin Van Heuvel is to be by him surrendered to your said attorney for cancellation and delivery to the said W. C. Wood Lumber Company without the said Van Heuvel receiving any note in exchange therefor, and to secure the surrender of said note the said Martin Van Heuvel leaves with your said attorney your $25,000.00 Class B note to which the said Van Heuvel is entitled under the agreed distribution between the undersigned. The remainder of said seven notes, namely, one for $17,680.85 and four for $10,000.00 are to be exchanged dollar for dollar for your Class B notes, and to accomplish such purpose we are leaving with your said attorney your Class B notes as follows: One for $17,680.85, two for $10,000.00 each, and four for $5,000.00 each. We do each hereby guarantee that within sixty days from this date all of said last mentioned five notes of the said W. C. Wood Lumber Company will be presented to your said attorney and exchanged for your notes as above provided. It is understood that the holders of the said notes of the W. C. Wood Lumber Company are each entitled to collect and retain the installment of interest thereon which matured on June 3rd, 1924.

"The $6,000.00 Class B note you will use in taking up the above mentioned draft drawn by attorneys Toomer and the firm of Johnson & Garrett and to that end you will deliver the said $6,000.00 note to the said Merchants Bank.

"We are obligated along with you to secure for Manatee Naval Stores Company such extension of time for payment of certain obligations on its part for commissions for making the sale by it of the lands which it conveyed to us as are rendered necessary by and through the extensions which the said Manatee Naval Stores Company has agreed to with respect to the purchase money notes which it holds. The undersigned Martin Van Heuvel owns or controls all but a small percentage of the said commissions and we hereby jointly and severally agree to secure the above mentioned extensions with respect to the payment of the same in such manner as to completely perform and discharge the obligations of you and us in that behalf to the said Manatee Naval Stores Company. We hereby acknowledge that the said extension was for our benefit and that we, therefore, are primarily liable for the securing of the required extension as to the payment of said commissions, and we assume the entire burden of so doing.

"To assure that this promise will be carried out, your above mentioned $25,000.00 note being distributed to the undersigned Martin Van Heuvel, shall be held by your said attorney until the matter of the extension of the payment of said commissions is arranged to the satisfaction of said Manatee Naval Stores Company.

"Yours truly,

"Martin Van Heuvel

"I. T. Roberts"

Stevens, McCorvey, McLeod, Goode & Turner, of Mobile, for appellant.

Harry T. Smith & Caffey and Outlaw & Kilborn, all of Mobile, for appellee.

THOMAS J.

This litigation is the result of the charge that appellant overreached his coadventurer in their final settlement and distribution of the proceeds and profits accruing to them from the sale of certain real property located in the state of Florida.

It is admitted that the parties were mutually interested in the ratios indicated; that the benefits were to be obtained and equally divided; but the trial court held that, by reason of the manipulations of appellant, who deceived or overreached appellee, the former unduly received an amount in excess of the latter.

The relations and duties, respective and mutual, of the parties as coadventurers are well understood in this jurisdiction, as those in fiduciary and confidential relation, as that of partners, principal and agent, and trustee and cestui que trustent, etc., as to being "bound by the uberrima fides of the relation." Saunders v. McDonough, 191 Ala. 119, 67 So. 591; Enslen v. Allen, 160 Ala. 529, 49 So. 430; Goldsmith v. Eichold Bros. & Weiss, 94 Ala. 119, 10 So. 80, 33 Am. St. Rep. 97; Bestor v. Barker, 106 Ala. 240, 250, 17 So. 389; Powell v. Wilson, 219 Ala. 645, 123 So. 38, 43; Verner v. Mosely (Ala. Sup.) 127 So. 527; Dikis v. Likis, 187 Ala. 218, 221, 65 So. 398; and general authorities 12 C.J. p. 421; 33 C.J. p. 851, note 83; Lindley on Partnership (Ewell's) vol. 2, p. 775; 30 Cyc. 458 (6). The utmost good faith and fairness in the prosecution of the common enterprise are exacted, and it is forbidden that there be accrual of profits, benefits, or advantages therein to one of the members or coadventurers which are not shared by his associates. The one acts for and by the other, is subject to its disadvantages, and equally partakes of its benefits. Winsett v. Winsett, 203 Ala. 373, 376, 83 So. 117.

Courts are careful not to fetter this useful jurisdiction in such matters by defining the exact limits of its exercise. In this connection Lord Chelmsford observes that, wherever two persons stand in such a relation to each other that, while it continues, confidence is necessarily reposed by one, and the "influence which naturally grows out of that confidence is possessed by the other, and this confidence is abused, or the...