Case ID: misc_35/html/0595-01.html
Source: Caselaw Access Project
Author: {"author": "Hiscock, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

John M. Schultz, Plaintiff, v. The Brackett Bridge Co., Defendant.
    (Supreme Court, Onondaga Special Term,
    July, 1901.)
    Test of partnership inter se — Intent — Share of profits as compensation and accounting therefor at law — "Vacation of an attachment refused where it was disputed whether the action was legal or equi-' • table and the merits were involved.
    The intent of the parties as shown hy all their agreements and acts governs, in part, the decision of the question whether they were partners.
    
      The fact that one of them was to receive as compensation a share of the profits, requiring for its determination an accounting, does not decisively determine that the arrangement was a partnership nor is an action in equity necessary to such an "accounting as it may be had in an action at law.
    Where the plaintiff sued a foreign corporation at law to. recover, as he alleged, a share of the profits of certain contracts as compensation for having procured them for the defendant as its agent and obtained in the action an attachment accompanying the summons, and the defendant gave evidence upon the trial, still pending before a referee, that the parties were partners, and it appeared that a motion to dismiss the complaint upon the ground that the action was one at law, that the plaintiff’s own evidence had established the partnership and that there could be no recovery under the complaint had already been denied by the referee, the Special Term refused, pending the action, to vacate the attachment—on the defendant’s alleged ground that, the action was equitable and therefor an attachment could not be granted therein —for the reasons, first, that the referee had already denied that contention during a trial unfinished and, second, because the question affected the merits of the action and they ought not to be decided, upon such a preliminary motion.
    Motion to vacate an attachment.
    W. G. Tracey, for motion.
    James E. Newell, opposed.
   Hiscock, J.

The ' attachment in this action was granted .to accompany the summons on the ground that the defendant is a foreign corporation. The motion to vacate said attachment is made upon the ground that plaintiff’s cause of action is really one in equity for an accounting between himself and the defendant as copartners, and that, therefore, an attachment will not lie. Support for the motion, upon the ground in question, is sought by defendant in the evidence given upon the trial of the case upon its merits before a referee, and which evidence discloses the fact that plaintiff was to receive a share of the profits realized upon bridge contracts which he might obtain, the question being controverted here whether he was to receive' such share in profits merely as compensation for his services as an agent and employee of the defendant, or whether he was to receive it .through an arrangement which amounted to a partnership between him and the defendant.

Plaintiff’s complaint, upon which the attachment was, in part, at least, founded, clearly sets forth a cause of action at law, it distinctly alleging, in substance, that he was to receive a share in the profits realized upon bridge contracts by way of compensation for his services as agent in procuring them. The evidence and affidavits submitted to me upon this motion certainly do not establish, beyond any question, that his relations with defendant were those of a partner, and that this is an action in equity.

The question whether a partnership exists or not depends, in part, at least, upon the intent of the parties to be gathered from all of their agreements and acts. Heye v. Tilford, 2 App. Div. 350.

The mere fact that a person is to receive for services a share in the net profits of a business, and that an accounting is necessary to ascertain the amount of the compensation,' does not decisively settle that the arrangement is a copartnership, and does not require an equity action. An accounting is proper in an action at law, and the introduction of the requisite evidence does not change the nature of the action. Smith v. Bodine, 74 N. Y. 30.

Plaintiff, as stated, clearly sets forth, in his complaint, an action at law, and if he fails to establish a cause of action under his complaint, defendant, of course, will be entitled to a judgment dismissing the complaint. This question, whether a partnership exists or not, is to be determined within the principle of the cases above cited, from all of the evidence which may be presented. The question is one which is now upon trial upon the merits before the referee, and upon which a large amount of evidence has already been produced. The precise question here presented has been presented upon said reference by a motion of the defendant to dismiss plaintiff’s complaint, upon the ground that his evidence established that he and defendant were copartners, and that there could be no recovery under the complaint; that the cause of action set up in the complaint is one at law, upon which an attachment had been -issued and levied, and that .the plaintiff’s testimony showed that the plaintiff and defendant were to share in the losses as well as the profits. This motion was denied.

Therefore, to pass upon this motion at this time would require a decision, upon affidavits and incomplete evidence, of a question which is involved in the merits of the trial now proceeding before the referee. Independent of the undesirability of thus anticipating the decision of the referee upon the trial, I am averse to deciding the merits of an action upon a preliminary motion of this kind. Kirby v. Colwell, 81 Hun, 385; Chambers & McKee Class Co. v. Roberts, 4 App. Div. 20; Furbush v. Eye, 11 id. 325.

The motion to vacate the attachment is, therefore, denied, with ten dollars costs.

Motion denied, with ten dollars costs.