Case ID: nj-eq_5/html/0119-01.html
Source: Caselaw Access Project
Author: {"author": "The Chancellor.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

JONATHAN H. WILLIAMS v. PHILIP KINGSLEY, ADMINISTRATOR, &c., OF NATHANIEL STEVENS, DECEASED.
    1. One of two partners, being about to leave the state for his health, assigned to the other partner a bond and mortgage he held against a third person. He died while absent. The administrator of his personal estate sued the surviving partner for the amount of the'bond and mortgage. On a sworn bill, filed by the surviving partner, stating that the deceased partner, when he left, was indebted to the partnership in more than the amount of the bond and mortgage, and that it was agreed between them that they should be applied to the purposes of the partnership (stating how), and that he had so applied them, the administrator was enjoined from proceeding in the suit.
    2. The facts on which the equity of the bill rested, were not charged to be within the knowledge of the administrator. A motion to dissolve, on his answer, was denied.
    3. Insufficiency of answer in other respects.
    Jonathan H. Williams, the complainant, and Nathaniel Stevens, since deceased, in May, 1835, entered into partnership in the hatting business, the business to be carried on in the name of the complainant. On the 1st of January, 1839, the complainant and Stevens came to a settlement of the partnership business up to that time, on which settlement Stevens was found to be indebted to the partnership in $1541, and the complainant to be indebted in $213. The partnership business continued till the death of Stevens, at St. Augustine, in November, 1839. On the 8th of October, 1839, Stevens, being about to leave this state for St. Augustine, for his health, assigned and delivered to the complainant a bond and mortgage, given by one William Bodwell to him, Stevens, on which there was due of principal and interest, $640. Stevens died while absent. In January, 1841, administration of his goods, chattels, &c., was granted by the surrogate of Essex county, in this state, to Philip Kingsley, the defendant. The defendant, as sueh administrator, brought an action of assumpsit against the complainant, to recover the sum due on the bond and mortgage when the same was assigned to the complainant. The complainant, in February, 1843, filed his bill, stating, in addition to the foregoing facts, that the settlement in Jannary, 1830, was made at Stevens’ house, and that a particular statement thereof was then made, and left with Stevens; that a note of the settlement was made in the books of account of the partnership, and signed by the complainant and Stevens at the time, but that said books are in the possession of the widow of Stevens; that when the bond and mortgage were assigned, Stevens owed the partnership more than the sum due thereon; and that it was then understood and agreed that the bond and mortgage should be collected or disposed of by the complainant, to pay the debts and carry on the business of the partnership, and, particularly, that a debt of $500, then due from the partnership to said Bodwell, should be discharged from the amount due on said bond. That the complainant, in January, 1840, settled with Bodwell, and allowed him his demand against the partnership, towards payment of his said bond and mortgage, and received from him the balance due thereon. That after the death of Stevens, the complainant, as surviving partner, paid all the debts of the partnership, and collected debts and disposed of the stock in trade, which was of small value. That the defendant, as such administrator, compromised and settled a debt due the partnership from Eansom & Company, of Few York, of $386, besides interest, and received fifty cents on the dollar therefor, and that he may have received other debts, and prays a discovery. That the complainant and defendant are unable to agree on a settlement, the defendant insisting that the complainant is bound to pay to him the principal and interest of the said bond and mortgage. That Stevens, at the time of his death, was indebted to the complainant on a note given by him to the complainant, dated May 14th, 1835, -payable at ten months, for $500, and that th6 same, with the interest thereon, is still due. That on a .just settlement of the accounts of the partnership, crediting the estate with the said bond and mortgage, there would be due the estate of Stevens, about $21, without allowing the complainant anything for his expenses and pains in settling the partnership estate; and that if the said note of $500, with the interest thereon, be taken into the account, there would be due the complainant upwards of $700. The bill claims that the amount due on the said bond and mortgage when the same were so assigned, should be settled with and as part of the partnership accounts, and not be considered an individual debt due from the complainant to the estate of Stevens; and prays an account of the partnership transactions, and of all moneys received by the defendant from the partner» ship effects ; and that, iu the meantime, the said suit at law may be enjoined.
    The injunction prayed was granted.
    The defendant put in an answer to the bill. The only parts of the answer*which need now be stated are as follows : It admits that in January, 1839, Stevens and the complainant made some settlement or adjustment of their business up to that time; and that from entries in one of the books of account, signed by the complainant and Stevens, on settlement then made between them, respectively, and the shop,, there was due from Steveus $1541.60, aud from complainant $213.32. That the business was carried on, after that settlement, till the death of Stevens; that the books of account relating to the business are in his, the defendant’s, possession; and states that from the entries in said books, up to the time of the death of Stevens, on a fair serthment of the accounts, there is nothing due from Stevens on account thereof. The answer further states that Stevens, previous to leaving the state, placed ii' the hands of the complainant the Bodwell bond and mortgage, to be collected by the complainant for his use, and took the complainant’s receipt for the same, which is now in his, the defendant’s, possession, ready to be produced, <fec.; and denies that said bond and mortgage were assigned and delivered to the complainant, to be collected and disposed of by him for the purpose of paying the debts of the partnership, or carrying on said business; and denying any agreement or understanding between Stevens and the complainant, that $500 and upwards should be paid or allowed to Bodwell from the amount due on said bond and mortgage, or any agreement to that or the like effect.
    The answer denies that the defendant and complainant were unable to agree on a settlement, and says that, on the contrary, they did agree upon a settlement, and that on or about the time of the settlement made by him, the defendant, with Ransom <fe Company, the complainant and the defendant settled all the accounts and transactions in relation to said business carried on between the complainant and Stevens ; and that since the said settlement, the complainant has admitted that there was no dispute about the said Bodwell bond and mortgage, and that he was to pay the amount received on the same to the defendant, as administrator, &c., of Stevens.
    The answ.er says it may be true that the complainant has in his possession the promissory note made by Stevens, mentioned in the bill, but denies that it is justly owing to the complainant; that the complainant, in all his transactions with the defendant in relation to the settlement of the business between the complainant and Stevens, never informed the defendant of the existence of said note, or made any claim for the same; and the defendant insists that, if any such note exists, it is fraudulent and void, and has long since been paid off and satisfied, and is kept on foot by fraud.
    The defendant says that after the death of Stevens, the complainant caused entries to be made in the books, giving himself large credits on account of said business, to which he is not fairly entitled ; and that on examining said book's he, the defendant, has been unable to find therein any credits given to Stevens for the said bond and mortgage.
    On this answer, a motion was made to dissolve the injunction.
    
      S. R. Grover, for the motion.
    
      A Whitehead, contra, cited 1 Paige 100, 426; 3 Ibid. 42, 436; 2 Johns. Ch. Rep. 204; Hopk. 148; 1 Green’s Ch. Rep. 193, 43b; Dev. Eq. 429.
   The Chancellor.

The leading facts on which the equity of the bill rests, are, that on the 1st of January, 1839, a settlement of the business up to that time was made between the complainant and Jtevens, by which Stevens was found to be indebted to the partnership in 1541 dollars, and the complainant to be indebted to *he partnership in 213 dollars and 28 cents, a particular state ¡nt of which settlement was left with Stevens, and a note of which was made in the books of the partnership, and signed by the complainant and Stevens; that uie said books arc in the possession of the defendant; that the business was continued after that settlement, till the death of Stevens, which occurred at St. Augustine, Florida, whither he nad gone for his health, in November, 1839. That on the 8t. of October, 1839, shortly before he left this state for St. Augustine, Stevens assigned and delivered to the complainant a bond and mortgage given by one Bodwell to him, on which 640 dol» lars was due, which it was then understood and agreed shoult. be collected or disposed of by the complainant, to pay the debo and carry on the business of the partnership; and particularly that a debt of 500 dollars, due from the partnership to Bodwell should be settled; that the complainant settled with Bodwell the said debt, with the bond and mortgage, and received from him the balance. That after the death of Stevens, the complainan paid ail the debts of the partnership; and that on a settlement of the partnership accounts, after crediting Stevens with the amount of the bond and mortgage, there would be due Stevens about 21 dollars, without allowing the complainant anything for his expenses and pains in settling the partnership business .That Stevens, at the time of his death, was indebted to rh« complainant, on a promissory note given by him to the complainant, dated May 14th, 1835, payable in ten months, for 500 dollars, which, with the interest thereon, is still due and unpaid.

The bill prays an account of the partnership affairs, and an injunction against farther proceedings in a suit brought by the defendant, as administrator, &c., of Stevens, against the complainant, to "recover the amount which was due on the said bond and mortgage when the same was so assigned to the complainant.

The indebtedness of Stevens to the partnership in January, 1839, is admitted. How, and for what purpose, was the Bod-well bond and mortgage assigned to the complainant? Was the assignment general and absolute, or was it special? From the language of the bill, I should understand that the assignment was in the usual form, absolute, and that there was an understanding or agreement, not appearing in the written assignment, that the bond and mortgage should be collected or disposed of for the purpose of the partnership, as stated in the bill. The defendant, having no personal knowledge of the transaction, denies that they were to be so applied, and insists that they were to be applied to Stevens’ individual use and benefit, and says that he has in his possession the complainant’s receipt for the same, but he does not set out the terms or the contents of the receipt.

„ The terms of this' receipt might have aided much in the decision of the question now before the court. If it would show that the complainant agreed to account with Stevens, individually, for the proceeds of the bond and mortgage, more should have been said in the answer about it, than simply that Stevens took the complainant’s receipt for the bond and mortgage. If the assignment of the bond and mortgage was general and ausolute, the receipt must have been taken for some purpose, and that purpose, it is presumed, would be stated in it; and if the administrator founds his denial of the charge, that the bond and mortgage were to be applied as stated in the bill, on information acquired from the receipt, he should have apprised the court of the terms of the receipt. The mere denial of an administrator having no personal knowledge of a transaction between his intestate and a complainant, is not sufficient to dissolve an injunction.

The bill states that at the time of the assignment of the bond and mortgage, Stevens was indebted to the partnership in a considerable sum, and more than the amount due on the bond and mortgage. The answer to this is a denial by the administrator that Stevens, when he left the state, was indebted to the partnership in a considerable sum; and a statement that he, the defendant, has heard and believes, that the complainant, since the granting of letters of administration to the defendant, and since the settlement stated in his answer to have been made between the complainant and defendant, admitted that there was no dispute about the bond and mortgage, and that he was to pay the amount he received on the same to the defendant, as administrator of Stevens. This denial is insufficient, and is not aided by the hearsay set up in the answer.

To the charge in the bill, of the indebtedness of Stevens, and the amount thereof, to the partnership, at the time of the assignment of the bond and mortgage, the defendant admits that the books of account are in his possession, and says that, from the entries in the said books up to the time of the death of Stevens, on a fair settlement of the accounts respecting said business, there is nothing due from Stevens on account thereof. What are we to understand by the fair settlement the defendant here speaks of? The bill states that the complainant and defendant are unable to agree on a settlement, the defendant insisting that the complainant is bound to pay him the principal and interest of the bond and mortgage. The answer says that the complainant and defendant did agree on a settlement. What was settled? It appears to me that the answer, examined in reference to the charges of the bill, is not sufficient to show that this matter of the bond and mortgage was ever settled between ihem. When the defendant, in his answer, says that he and the complainant agreed to settle all the accounts and transactions in relation to said business, he may mean all the accounts and transactions that he supposed belonged to said business. Did they settle all matters which the complainant claimed to belong to the partnership accounts? Did the complainant then admit that the bond and mortgage did not belong to the partnership business ? If he did, it would not have been necessary for the defendant, in his answer, to resort to the statement that, since the settlement, the complainant had admitted that he was to pay to the defendant the amount of the bond and mortgage.

It is manifest that whatever may have been said or done at any settlement, or attempted settlement, the parties are still at variance as to how the bond and mortgage are to be accounted for; and we are brought back to the inquiry for the terms of the receipt, which the defendant says he has in his possession. Again, if there was a full settlement between these parties, the posture of their affairs, and particularly the character in which the defendant was acting, would lead us to expect some written evidence of it.

In view of the whole ease, I think it would not be a safa exercise of discretion to dissolve the injunction.

Motion denied.

Cited in Holdredge v. Gwynne, 3 C. E. Gr. 32.