Case ID: va_36/html/0101-01.html
Source: Caselaw Access Project
Author: {"author": "BROCKENBROUGH, J. CABELL, J. PARKER, J. BROCKENBROUGH, J. CABEEE, J. ^BROOKE}, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

*Towner v. Lane’s Adm’r.
    February, 1838,
    Richmond.
    (Absent Tucker, P.)
    Partnership — Losses — Profits — Apportionment. — Quere, whether, in the case of a mercantile partnership formed without any agreement as to the proportion in which the losses are to be borne and the profits divided between the partners, the same are to be borne or divided equally between them, or are to be apportioned in the ratio of their respective contributions ?
    Practice in Court of Appeals — Rehearing at Subsequent Term — Mistake of Fact. — Upon a petition for a rehearing of a cause in this court, at a term subsequent to that at which the court has entered a decree, but before that decree has been certified to the court below, on the ground that the decree was founded on a mistake in point of fact; the question was whether it was in the power of the court to allow the rehearing? And upon this question, four judges present were equally divided in opinion.
    James Lane had been, for many years prior to 1817, engaged in quite an extensive mercantile business, consisting principally in the retailing of merchandise, at Shepherdstown in Jefferson county, and Benjamin Towner was a young man who had been long in his employment there, having been from early youth brought up to business by him. In September 1817, Lane admitted Towner into partnership with him ; and announced by advertisement at Shepherds-town, that he had given Towner an interest in his business at that place, which would in •future be carried on under the firm of Lane & Towner; this, Lane said in his advertisement, he had done to reward merit.
    The capital of the house of Lane & Towner consisted entirely of the stock of Lane’s previous business in which he alone was concerned. . Towner brought neither money nor merchandise, but only labour, industry and skill, into the partnership. Lane had several similar establishments at other places, and gave a general *superintendence to all. The particular business at Shepherdstown (namely, the retailing of the merchandise, the keeping of the accounts, the collection of the proceeds of sales, as well as the collection of moneys due to Lane on account of his former transactions) was confided almost exclusively to Towner : but Lane made the purchases of the goods which were brought to Shepherdstown to be retailed. Lane appeared to have been a prudent and judicious merchant; and the part of the business confided to Towner was faithfully and judiciously conducted by him. The business was profitable. The partnership continued until September 1823, when it was dissolved by the death of Lane.
    At the time the partnership of Lane & Towner was formed, there was no agreement between the partners, verbal or written, ascertaining the proportion of the profits which each was to receive; nor was there any agreement on that subject made between-them during the continuance of the partnership. And in July 1819, Towner (being about to be married) addressed a letter to Lane, in which he said, he would not have been engaged in business for two years with any other person without knowing the terms, but placing the most implicit confidence in Lane, he had not hitherto thought it necessary to ask what part of the profits he was to receive; he now inquired on what terms Lane expected or intended he should continue to do business in the partnership. It did not appear what answer, or that any answer, was returned by Lane to this letter.
    The stock of merchandise which Lane had on hand when the partnership of Lane & Towner was formed, being- intended as the stock with which this partnership was to commence business, an inventory thereof was taken, in which the articles were set down at their first cost; and according to the inventory, the value of the goods amounted to 48,456 dollars
    
      In August 1827, Henry Boteler, the administrator de bonis non of Lane, exhibited a bill, in the superiour court of chancery of Winchester, against Towner, the surviving partner, for a settlement of the accounts of the partnership transactions, and for a division of the profits according to the just rights of the partners.
    Towner, in his answer to this bill, insisted, that as the stock of merchandise on which the partnership of Lane & Towner commenced business, and which was inventoried at first cost, amounting to 48,456 dollars, was but the remnants of goods that Lane had purchased and had been trading on, during his previous transactions, for a course of many years, there ought to be an abatement of some fifteen or twenty per cent, from the amount at which they were rated in the inventory. But the point on which he principally insisted, was, that he was entitled to one half of the profits of the business; 1. because, as there had been no agreement between him and Lane touching the apportionment of profits between them, each was entitled, by the general principles of law and equity, to an equal share ; 2. because, as Lane had himself allowed one half of the profits of other partnerships, which he had formed with other junior partners at other places, to such junior partners, Towner inferred, that Lane really intended to allow him, likewise, one half of the profits of their partnership lousiness; and 3. because the capital of skill, labour and industry, which Towner had brought into the business, and devoted to it during its continuance, fairly entitled him to an equal share of the profits.
    Touching the facts upon the ground of which Towner claimed an equal share of the profits, the depositions of several witnesses were taken and filed in the cause ; but, for reasons which will appear in the sequel, it is unnecessary to state the evidence.
    An order was made by consent, referring all accounts between Lane and Towner to a commissioner, and especially *their partnership accounts, and directing the commissioner to ascertain and report the amount of profits of the partnership business — reserving all questions and principles involved in the case, for further examination and decision. And while the accounts were before the commissioners, the cause coming on for hearing before chancellor Browne, according to the reservation in the former order, the chancellor made an interlocutory decree, instructing the commissioner, that in stating the partnership accounts, he should first state the accounts of each partner with the firm, and credit Lane’s ' administrator with the amount of advances made by Lane to the firm and interest on those advances, and debit him with all sums drawn out by him, upon the ordinary principles of debtor and creditor ; that the whole amount which would be thus ascertained to be due to Lane, together with all expenses and losses, should be deducted from the partnership funds; and that the net profits which should remain, should be equally divided between the partners : but as these instructions to the commissioner were founded on evidence then before the court, and as further evidence might 3ret be introduced into the cause, which might so vary the state of the case as to render it proper to apply other principles to it, the court reserved liberty to either party to insist on another rule for the division of the profits, if any evidence after-wards adduced should, in his opinion, make out a different case from that which then appeared.
    The commissioner, in stating the partnership accounts, made various statements on which the general account of the partnership business was based. The first of these statements was the account directed by chancellor Browne’s decree, of Lane with the house of Lane & Towner; which was headed, and the first item of credit therein was, as follows :
    *“ Dr. James Lane,
    in account with Lane & Towner, Cr. 1817, Sept. 15. By sundry goods, wares and merchandise per inventory taken this day, $48,456.”*
    The resplt of the partnership accounts stated by the commissioners, shewed, that the net profits of the business amounted to 41,023 dollars ; which, in pursuance of the instructions of the court, he divided equally between the partners.
    The cause having been transferred to the circuit superiour court of Frederick, and there coming on for hearing upon the report of the commissioner, that court declared, that though, where two or more persons agree to carry on business as joint partners, and the agreement is silent as to the proportion in which they shall share the profits, the profits are, by construction of law, to be equally divided, having regard to the persons composing the firm, and without regard to the amoun t of capital or labour furnished by them, respectively, such being presumed to be the intention of the parties; yet, where the agreement is not completed by the parties, and they have designedly left for future adjustment the proportion in which the profits shall be divided, the rule of construction above mentioned is inapplicable, since such reservation for future adjustment by contract, manifests an intention that the rule of construction which the law would otherwise have enforced, shall not be, but some other shall be, the rule by which the losses and profits of the business shall be apportioned : that the law, indeed, would not enforce such a contract if it were executory, because of its incompleteness and uncertainty ; but where the parties have acted under it, and have carried on the intended business without settling the suspended terms between them, *and finally disagree in regard to the same, it devolves upon the court to supply the omission : and that, as the elements which enter into such a contract (capital, labour, skill, credit, connexions, risk &c.) do not furnish any rule of universal application, the court, in doing that which the parties ought to have done but have not done, must be governed by the circumstances of each particular case, and make such division as, under all the circumstances, appears to be just. And upon the evidence in the cause, and especially Towner’s letter to Lane of July 1819, the court was of opinion, that the proportion in which Towner was to share the profits of the business he had engaged in with his late master, was not settled, (much less was it understood that he was to receive half) but was to be the subject of future adjustment between them. The court inclined to refer it to a jury to say, what share of the profits Towner, under all the circumstances, reasonably deserved to have, but it finally concluded, that it was better for both parties, that the court should put an end to the litigation between them. The court then declared its opinion, that under the circumstances of the case, Towner reasonably deserved to have one fourth of the profits of the partnership business, and that the other three fourths thereof ought to be decreed to Lane’s administrator. Therefore, the court recommitted the accounts to the commissioner to be reformed accordingly, with some other instructions as to details of the accounts.
    Towner applied by petition to this court for an appeal from the decree ; which was allowed.
    I. Stanard, for the appellant, contended, that the principle upon which the decree apportioned the profits between the partners, was wholly erroneous : that to place the compensation to the junior partner upon the footing of a quantum meruit, as this decree did, was to give him wages for his labour as a servant, not a share *of profits as a partner; that it was the settled and invariable principle of the civil law (the fountain of the law merchant) recognized by the common law, that where a partnership is entered into between two or more, without any express agreement concerning their shares of profit and loss, the loss and the profit must be equally divided ; and that the nice distinction on which the decree denied one half of the profits to the junior partner, was unfounded, the circumstances of the present case being such, in truth, as to bring it exactly within the words and the reason of the general rule. He cited Just. Inst. Lib. Ill, Tit. XXVI, § 1 ; Domat, Lib. I, Tit. VIII, j5 I, 4 ; Ayliff. Civ. Law, Book IV, Tit. VIII, p. 468; Gow on Partn. 9 ; Watson on Partn. 57 ; 3 Kent’s Comm. 6 ; Peacock v. Peacock, 16 Ves. 49, 56 ; 2 Campb. Rep. 45 ; Crawshay v. Collins, 2 Russ. 325 ; 3 Condens. E)ng. Ch. Rep. 131.
    Cooke, for the appellee,
    denied that there was any such principle as that stated by Stanard, to be found in the civil law rightly understood: on the contrary, he said, the true principle of the civil law was, that in the case supposed (of the silence of a contract of a partnership on the subject of the apportionment of profit and loss), the profits and losses were to be apportioned between the partners, with reference to the value of their respective imputs, whether of money, merchandise or personal services, when they are ascertained or ascertainable. And to shew this, he cited from the Corpus Juris Civilis, vol. I, the passage in the Digest corresponding with that in the Institutes referred to by Stanard — Dig. Lib. XVTI, Tit. TI, § 29, also Id. § 6, 80, and from vol. II, the constitution of Leo, 103 — and the notes of Gothofred upon the several passages. He said, the key to the construction of the general language of the Digest and of the Institutes, was to be found in the circumstances, that the civil law idea of a partnership, in general, was an association of persons contributing equally *to a common stock with a view to make profit; therefore, the civil law, in saying of partnerships generally, that if there should be no agreement concerning the apportionment of profits, they should be equally divided, did, in effect, no more than affirm the principle, that the profits should be divided between or among partners in proportion to their input. Pothier, in his treatise on the Contract of Partnership, was explicit, that the profits ought to be divided among the partners, in proportion to the value of what each of them has brought into the partnership. Pothier, Contr. de Soc. n. 15, 16, 73. He thought chancellor Kent had misapprehended the passage of Pothier, n. 73, cited by him in his commentaries, vol. 3, p. 6.
    II. Stanard, adverting to the first item of credit in the account stated in the report of the commissioner, of “James Lane in account with Lane & Towner,” where Lane was credited, under date “September 15,1817, By sundry goods, wares and merchandise, per inventory taken this day, 48,456 dollars,” insisted, that this must be regarded as taken from an entry in the partnership books. And then he maintained, that this entry was evidence of a sale by Lane to the new house of Lane & Towner, of merchandise to the amount or value therein specified, of 48,456 dollars : that the circumstance of the vendor’s being a partner of the purchasing house, did nowise affect the legal character of the transaction proved by the entry ; which was a sale and purchase to allintents and purposes, just as if the transaction had taken place between a third person and Lane & Towner : that thus, Lane & Towner commenced business on a stock of purchased goods, of which they were joint and equal owners : that Towner did, therefore, in fact, put in as much stock as Lane ; and was therefore entitled to an equal share of the profits.
    Cooke answered, 1. that it did not appear by the commissioner’s report, that there was any such entry in the partnership books, as this item of credit in the account *stated by him; and, he said, there was, in truth, no such entry in the books. But, 2. if there was such an entry there, he contended it could not bear the construction the appellant’s counsel had put upon it, or warrant the inference he had drawn from it.
    
      
      Practice in Court of Appeals — Rehearing at a Subsequent Term — Error of Law or Fact. — In Campbell v. Campbell, 22 Graft. 666-669, 671, the court, after setting forth the decisions In White v. Atkinson, 2 Call 376; Price v. Campbell, 5 Call, 115; Campbell v. Price, 3 Munf. 227; Bank of Virginia v. Craig, 6 Leigh 399, and Towner v. Lane, 9 Leigh 262, and quoting at some length from the opinions of Parker and Brockekbrough, .1 .T., in this last-named case, said: "‘These seem to be all the material decisions of this court on the subject we are considering, to which we have been referred by counsel, or which we have met with, and they seem conclusively to show that after the end of the term of this court at which a judgment or decree may be rendered by it —or at all events, after such judgment or decree has been certified to the court below, it is too late to have the case reheard in this court, upon any ground of error of law or of fact apparent upon the face of such judgment or decree, or of the record on which it was rendered. Whether the rule be founded on principle, or be merely a rule of practice, it is alike absolute and inflexible. Public policy, if not necessity, requires that it should be strictly enforced, even in cases of the greatest individual hardship. The law has been settled by these cases, and has ever since been acquiesced in, and hence no more recent cases on the sub j ect are to be found in our reports. Applications for rehearings after the end of the term have often since been made to this court, but have always been refused, and there the cases have ended. There is a recent statute authorizing the court, under certain circumstances, to rehear and review a case decided at the preceding term. Acts of Assembly 1869-70, p. 228, ch. 171, § 10 (Va. Code, 1887, § 3492). But that statute has no bearing on this case.” See also, the principal case cited to the same point in N. Y. Life Ins. Co. v. Clemmitt, 77 Va. 374; Hall v. Bank of Virginia, 15 W. Va. 327, 328, 332.
      As approving the decision of Bank of Virginia v. Craig, 6 Leigh 438, see principal case cited in Newman v. Mollohan, 10 W. Va. 502.
      Court of Appeals — Decree Final — Second Appeal — Bill of Review. — The decree of the court of appeals upon a question, decided by the court below, is final and irreversible; and, upon a second appeal in the cause, the question, decided upon the first appeal, cannot be reviewed. In such case, the conclusiveness of the decree of the court of appeals is the same, whether the first appeal was from a final, or interlocutory decree of the court below. When the court of appeals makes a decree, and sends the cause back for further proceedings, there cannot be a bill of review, to correct the decree of the court of appeals for error apparent. Henry v. Davis, 13 W. Va. 252, 253, citing principal case; White v. Atkinson, 2 Call 376; Price v. Campbell, 5 Call 115; McCall v. Graham, 1 H. & M. 13: Campbell v. Price, 3 Munf. 227; Bank of Virginia v. Craig, 6 Leigh 399; Newman v. Mollohan, 10 W. Va. 488; Western M. & M. Co. v. Va. C. & C. Co., 10 W. Va. 250; and Pinkney v. Jay, 12 Gill & J. 69. For other cases in point, see foot-note to Campbell v. Campbell, 22 Gratt. 649.
    
    
      
      The partnership hooks were not before this court, so as to see whether the commissioner copied this item from them or not. — Note in Original Edition.
    
   BROCKENBROUGH, J.

In the view which I have taken of this case, I do not know that it is important to decide which is the best construction of the civil law, that contended for by the appellant’s or by the appellee’s counsel. I shall, however, briefly notice them. On the one hand, we have the plain words of the Institutes, Lib. Ill, Tit. XXVI, § 1. “If no express agreement be made by-the partners concerning their shares of profit and loss, the loss and the profit must be equally divided;” Cooper’s Justinian, p. 280. Gow says, if there be not an express agreement, the partnership, as regards its regulation, is governed by the contract implied by the law from the relation of the parties : that in the latter case, the concurrent opinion of all the writers on the civil law, is, that the loss must be equally borne, and the profits equally divided ; and for this position he refers to the above quoted passage from the Institutes. The same construction is adopted by chancellor Kent in the third volume of his commentaries ; and such .was the clear opinion of lord Eldon, as expressed in Peacock v. Peacock, 16 Ves. 55. In that case, the jury that tried the issue which the chancellor had directed, found that the plaintiff, who had been taken into partnership by his father without any convention as to the shares of profit and loss, was entitled to one fourth of the profits : -lord Eldon was dissatisfied with the verdict, and said, it appeared to him that the son, insisting that he had a beneficial interest, must be entitled to an equal moiety, or to nothing ; that as no distinct share was ascertained by force of any express contract between them, they must of necessity be equal partners, *if partners in any thing. This opinion goes to the full extent of the construction contended for by the appellant’s counsel. On the other hand, the researches of Mr. Cooke have enabled him to shew, that several learned commentators have construed the passage from the Institutes and the correspondent passage from the Digest, differently. They maintain, that when a partnership contract does not express the ratio by which the profits shall be divided, and the original amount or value of the input of each partner is apparent or ascertainable, the profits shall be divided in the same proportion that the stock was contributed. This construction of the rule is adopted by Gothofred and Pothier, in the passages referred to by the counsel; and seems also to be supported by Domat, vol. I, Tit. VIII, § 1, 5. He says — - “ Although the partners have not expressly marked both the portions of the gain and those of the loss, yet if' the portions of the gain have been expressed, those of the loss will likewise be regulated on the same foot. And if, without saying any thing of the gain or loss, it* be sufficiently expressed what every one has put into the common stock, the portions of the gain or loss will be the same with those of the stock.” Iam very strongly inclined to the opinion, that this is the true construction ; and that where it is clearly expressed, that A. puts into the common stock one hundred dollars, and B. fifty, and nothing is said about the profit or loss, the profits will be divided in the same ratio, if the business be successful, and the losses in the same ratio, if unsuccessful.

But if this be the true construction, yet the appellee’s counsel gains nothing, unless he can shew, that these partners have in fact contributed unequally ‘to the common stock. The construction is not at all incompatible with the proposition, that if one of the partners lends or sells to the firm the whole stock, he lends or sells to the other partner one moiety of that stock, and that each partner thereby contributes equally to the common *stock. The partner borrowing or buying is a debtor to the other, and is liable to refund or pay, either from his own share of the profits, or from his own peculiar property. This idea is well expressed by lord Eldon, in Crawshay v. Collins — “ Where a sum is advanced as a loan to an individual partner, his profits are first answerable for that sum ; and if his profits shall not be sufficient to answer it, the deficiency shall be made good out of his capital; and if both his profits and his capital are not sufficient to make it good, he is considered as a debtor for the excess. ”

According to the evidence in this case, I am of opinion, that the input of goods, wares and merchandise of each of the partners, Lane and Towner, was equal. I form this opinion from the entries in the books of the partnership, which are most persuasive evidence for and against each, because they are the books of both. It is true that these books are not copied into the record, but they were resorted to by the commissioner (and the report in this respect is not excepted to); and from his report it is evident, that the first account raised in them was thus : “ Dr. James Lane in account with Lane & Towner, Cr. ” And the first credit given to Lane with the partnership, on the very day it was formed, (15th September 1817) was for sundry goods, wares and merchandises, per inventory of this day, 48,456 dollars. Here was an advance by Lane to the partnership of the whole of the specified sum, and consequently to Towner his partner, of a'moiety of that sum. The goods which had been previously the property of Lane were on that day inventoried and valued, and placed in the storehouse of Lane & Towner, and the former owner was - credited with them on the books of the partnership. This was a sale and transfer of those goods by Lane to the firm, and by this simple operation the property in them was transferred to Lane & Towner. If the goods had been sold by a Baltimore wholesale merchant to *the house of Lane & Towner, no one would doubt that Towner’s share of them was the same with that of Lane ; and I can see no difference between a sale by a third person and the sale by Lane himself.

The personal services of the partners, I consider as equal; at least, I see nothing in the evidence to justify the opinion, that the administrator of Lane can set up any pretension to greater services than Towner. The latter was engaged principally in the business of selling the goods, for which his long acquaintance with the customers peculiarly fitted him. Lane, on the other hand, was principally engaged in buying and laying in goods. Even if this service was more important than that of selling (which does not appear), yet this was counterbalanced by the fact that Lane’s whole attention was not bestowed on the business of this particular partnership. He was the elder partner in many other firms, and he was employed in making purchases hot only for Lane & Towner but for all his other mercantile concerns.

One argument urged to shew that Towner was not entitled to an equal share of the profits, is, that after the partnership had been in existence for two years, he wrote a letter to Lane, inquiring on what terms he expected or intended him to do business; and declaring, that he would not have done business for two years for any other person without knowing the terms; but that, placing the most implicit confidence in him, he had not before thought it necessary even to ask what part of the profits he was to receive. The inference is hastily drawn from this letter, that Towner'knew he was not to share equally. It is not a correct inference. The change that was about to take place in Towner’s situation, plainly shews his motive in asking for a decision. It'is not wonderful, that he should wish to be on a sure footing; and this long protracted controversy proves, that he was right in his desire to have the questions which might *arise between them settled by a convention. With respect to this letter, I will observe, 1. that it tends to prove, that, at its date, there had been no agreement between them as to the shares of profit and loss; and, consequently, that it leaves the operation of the rule of law (whatever it may be) in full force : 2. that as there is no answer to it, specifying the terms on which Lane understood they should keep up the partnership, we must conclude, that Lane himself was willing, that the decision of the question as to the share of the profits should rest on the footing on which the law placed it. If it be supposed, that Lane did answer the letter, and that Towner withheld the answer, it may be remarked, that the suspicion is entirely gratuitous. The bill does not charge, that Lane ever answered the letter, nor does it call on the defendant to say, whether he ever answered it: the plaintiff, by an amended bill, might have required the evidence of the defendant on oath as to this matter; and we cannot infer, in the absence of the answer to the letter, that Lane ever did express in writing, or otherwise, any determination as to the manner of sharing the profits.

The judge of the circuit superiour court was of opinion, that under the circumstances of this case, the defendant Towner reasonably deserved to have one fourth of the net profits, and the other partner three fourths. This decision was probably founded on that of lord Ellenborough in Peacock v. Peacock, 2 Camp. 45, on the trial of the issue which lord Eldon had directed. He left it to the jury to decide, what the plaintiff should have, and they decided on one fourth. If the judge, in this case, had been right in supposing that it should be decided on the principle of quantum meruit, yet I think he was wrong in not leaving that matter to be decided by a jury.

I am of opinion, that the rule adopted by chancellor Browne in the directions which he gave to the commissioner *was entirely correct. The only objection made to it by the appellant’s counsel, is, that he authorized interest to be allowed to Lane on all advances made by him to the firm. I have no doubt that a jury would have allowed interest; and it is a well settled rule, in all our courts, that it shall be allowed on all advances, whether the account has been liquidated or not.

The commissioner in his report conformed to the directions of the chancellor, and reported the net profits (after paying Lane the amount of all his advances to the firm, and interest on them) to be 41,023 dollars. In that settlement the goods were charged to the firm, at the price set down in the inventory first taken. This is objected to by Towner, and a great deal of evidence is taken to prove, that they were very greatly overvalued. I pay no attention to that evidence. The inventory and valuation were made under the superintendence of both the partners, and that makes it a binding agreement on them.

I think the decree should be reversed, and the cause remanded to the circuit superiour court, to be further proceeded in according to the opinion declared by this court.

CABELL, J.

It is unnecessary to discuss the question, what ought to be the ratio for apportioning the profits and losses of the firm of Lane & Towner, if the parties had contributed unequal portions of input stock, and had been silent as to the rule of apportionment. No such inequality exists in this case. Nothing was put in as stock by either partner. Neither contributed any thing, but his personal credit, his skill, his attention, his time and labour. The goods, wares and merchandise, which, on the 15th September 1817, were entered on the books of the firm to the credit of Lane, were not put in as his portion of input stock, but as a sale to the partnership. By that transaction, the goods became *the joint property of the house ; Towner’s interest in them was, in every respect, equal to that of Lane; and if they had been consumed by fire the next day, the loss would have fallen on Towner equally with Lane; for he would have remained liable to Lane for a full moiety of the price at which they had been entered to the credit of Lane. Every body would admit this to be the case, if the goods had been purchased from some merchant in Baltimore, or elsewhere ; and the principle is precisely the same where the purchase is made of an individual partner. Towner’s contributions to the firm, so far as relates to these goods, and indeed as to every thing else, were equal to Lane’s; and as the partners made no special agreement as to the division of profits, the case, in this, view of it, becomes one to which, by universal consent, the rule of equality is applicable. Towner is, therefore, entitled to an equal portion of the profits.

But I am of opinion, that Lane is entitled to interest on his advances to or for the company, and that his account should be settled on the principles applicable to ordinary debtors and creditors. He is to be credited for the goods furnished by him to the partnership, at the price at which they are creditors to him in the books ; for that must be regarded as a matter adjusted and agreed to by the parties. But in settling the affairs of the partnership, for the purpose of ascertaining the profits, the goods remaining on hand at the dissolution of it, should be set down at the price at which they were sold, and not at the inventory prices, as stated in the report of the commissioner.

The decree should be reversed, and the cause remanded to be farther proceeded in according to these principles. And both parties should be at liberty to take any exceptions to the reports of the commissioner, heretofore made, that they might have taken at any former stage of the cause.

PARKER and BROOKE, J., concurred. Decree reversed, an ¿cause remanded &c.

Before the above decree of reversal had been certified and transmitted by the clerk of this court to the circuit superiour court, but after the expiration of the term at which it was pronounced, namely, at the next ensuing term, Lane’s administrator presented a petition to this court, praying a rehearing, on the ground that the ¿ecree of this court touching the main point in controversy, was founded on a mistake in point of fact. That this court, regarding the first item of credit in the account stated in the commissioner’s report, of “James Lane in account with Lane & Towner,” where Lane was credited “September 15, 1817, By sundry goods, wares and merchandise, per inventory taken this day— 48,456 dollars,” as having been taken from an entry to'the same effect on the books of the partnership, had thence inferred a sale of the goods by Lane to Lane & Towner ; by which sale, the goods became the joint property of the partnership, and Towner’s interest in them equal to that of Lane ; so that Towner’s contribution of stock was equal to Lane’s, and consequently Towner was entitled to an equal share of the profits : whereas, in fact, there was no such entry on the books of the partnership as that found in the commissioner’s account; the commissioner having stated that particular account, in that form, not because he found such an account stated on the books, but because chancellor Browne’s decree instructed and required him to state the account. That the true state of the facts had been ascertained by an actual reference to the books of the partnership; and the proof was exhibited to the court, that there was no such entry on the books ; but if the court could not admit this proof, because it was no part of the record now here, yet a critical examination of the record itself would suffice to evince the truth of the case, and to «Satisfy the court, that its decree was founded on a mistake in point of fact.*

PARKER, J.

A motion has been made to set aside the decree in this cause, entered during the last term, and for a rehearing, on the ground of judicial error in matter of fact: and the motion has been urged with great earnestness and ability.

Taking it for granted, that there may have been such error in the decree, the first inquiry is, can it be amended after the term has ended in which it was pronounced ? Decrees and judgments stand, in this respect, upon the same footing. With respect to decrees in the inferiour courts, the doctrine has long been well settled, that after the term has passed, the cause cannot be reheard in the same court, except upon bill of review. In this court, we have no proceeding analogous to that. 'We must determine the question upon principle and authority.

It is just and expedient, that there should be some termination to litigation. Particular cases of hardship must yield to general rules of convenience. We must fix some period at .which cases shall be considered as finally ended, or this court will be overwhelmed with applications for rehearing, and parties will be kept in continual uncertainty of their rights. Eix on any we may, individual injustice may be done, but upon the whole, the public good will be promoted, by avoiding the mischiefs of uncertainty and long protracted law-suits. This is one of the chief reasons why we adhere to erroneous precedents. Whatever the period may be, it ought to be certain, well defined and inflexible ; or the evil is not remedied. If it depends on accidental circumstances, on the action of officers of the court, or *on matters in pais, de- • pending on evidence, the rule itself is of little importance.

The rule, that a cause shall not be reheard after the term is ended, is a certain and invariable one, of easy and uniform application. Any other that has been suggested, and especially that which makes the action of this court to depend upon the certifying of its decree to the court below, or upon that court’s receiving and entering the decree, wants all the qualities of certainty, invariableness, equality und uniformity.

Por these reasons, I should incline on principle to say, that the end of the term should be the en¿ of the litigation, so far as this court is concerned; and I think this rule is established by authority.

In England, it has been repeatedly held, that when ju¿gment is once given and enrolled, no amendment is permitted at any subsequent term. See 3 Christian’s Blacks. Comm. 407. All the cases proceed upon that distinction. In Blackmore’s Case, 8 Co. 156b, 157a, it is said, that, at common law, the judges might amend, as well their judgment as any part of the record &c. in the same term, for during the term, the record is in the breast of the judges, and not in the roll. In 1 Bac. Abr. Amendments and Jeofails, A. p. 145, it is laid down, that the record of a judgment is in the breast of the court all the same term, because it is a roll of that term, and so in the breast of the court during the whole term. So, in the case of The Parish of St. Clements v. The Parish of St. Andrews Holborn, 6 Mod. 287, Salk. 606, it was held, that the judgment of justice is in their breast, and alterable by them, all the same sessions. These decisions seem to me to have settled the doctrine in that country whence we derive the principles of our jurisprudence. Nor do I think, that the forbidding of alterations in the judgment of the court after the term, originated in the statute 11 Hen. 4, ch. 3. That statute did not prohibit them, but was, as I take it, only in Affirmance of the common law. Coke, Blackstone, and other writers, spéak of amendments after the term not being allowed at common law ; and in Chambers v. Moor, 2 Lev. 431, it is expressly affirmed, that such amendments could not be made at common law ; citing the year book 4 Edw. 3, pl. 9, b. which was before the statute 11 Hen. 4, ch. 3.

Looking, next, to our own precedents, we have, first, the case of The Commonwealth v. Beaumarchais, 3 Call 107, 151. In that case, all the judges thought the decree of the court below erroneous as it stood, but being divided in opinion whether the contract should be settled by a scale of four for one or of five for one, a decree was entered, stating that the chancellor’s decree was reversed, but that on account of the division among the judges as to the scale of depreciation, no further decree could be made, since the case was not provided for by the act of assembly. But, at a subsequent term, the court being of opinion, that upon an equal division of the judges in the partial affirmance of the decree, it ought to have been partially affirmed, and that the cause still remained in the court undecided and yet depending, the decree was corrected. Now, whether the court was right or wrong in saying that the former decree was interlocutory and not final, it is obvious it placed its control over the decree on the ground, and not on the ground of power to change the decree after the term : in truth, this ground is excluded by the reasons assigned.

In the case of Campbell v. Patterson, decided in March 1835, the court proceeded either on the ground of consent, or (what is more probable from the entry) on the ground that the court had no authority to hear the cause in the absence of retained counsel, necessarily otherwise engaged in the house of delegates, and that the cause had been heard by mistake, and against the rule established by the court in other cases; and consent having been in fact given for the reinstatement, it was ^probably little considered. It seems, too, in that case the certificate had actually gone out ; so that that distinction will not avail.

In the case of Glass v. Baker, 6 Munf. 218, a motion for a rehearing being made at the next term, it was overruled ; the court “doubting, at least, its right to rehear a cause at a subsequent term, and thinking it best not to do it.”

Then we have the case of The Bank of Virginia v. Craig, 6 Leigh 399, 438, which strongly appealed to the justice of the court ; for the sureties had not been heard, and the question decided against them was coram non judice; yet this court unanimously overruled the motion for rehearing, on the ground that it “ could not now set aside the decree entered at the former term, whether it was prematurely entered, or whether it was objectionable on its merits, or not.”

Other instances have been mentioned at the bar, of the court’s adherance to this rule ; but as they exist only in the recollection of counsel, and no entry was made on the record, I forbear to notice them. Enough appears to satisfy me, that the court has never intentionally departed from the rule of the english law, which I think is founded in wisdom and justice. If it is thought otherwise, let the legislature confer the power, and define its limits.

No distinction has ever been adverted to, of a decree being in the power of the court, as contradistinguished from its being in the breast of the judges ; and we have seen what is meant by that expression: nor has anj allusion ever been made to the certifying of the judgment or decree to the inferiour court, or to that court’s subsequent action on it.

I am of opinion, that this cause cannot be reheard ; and so thinking, I purposely abstain from any consideration of its merits, as they may possibly (in consequence of the leave reserved to the parties, by the degree, to *except to the commissioner’s report) come again, in some form, before this court.

BROCKENBROUGH, J.

I concur in the opinion just expressed. I have always understood, that when the term of the court ends, the case is no longer within the breast of the court, but constitutes part of the unchangeable records of the court. If it is afterwards deemed to be within the discretion of the court to reopen the record, what limit is to be placed to that discretion? Is the certificate of the clerk, which the statute directs to be transmitted to the clerk of the court whence the appeal was brought, to be taken as the termination of the cause here ? If so, very little relief will be given to suitors whose causes have been erroneously decided here. Each party who has gained his cause, will immediately apply for his certificate, and one or two days, instead of twenty, will be sufficient to furnish all the certificates. But if such a general demand be not made, then one rule will prevail in those cases where a long recess follows the termination of the term, and a different rule in cases where the ensuing recess is short. The rule at Lewis-burg will not be the same as at Richmond. The suitors here whose causes are decided against them at the November or January-term, may have them reopened : but the doors of the court will be closed against those unfortunate persons, against whom judgments or decrees have been rendered in the March or July term.

I cannot understand how the certificate of the clerk, or the transmission of it, can make the judgment or decree any more a part of the rolls of the court, than it was before. Even an execution is no part of the record of a judgment; and as the clerk of this court issues no executions, his certificate of the judgment (which, when received by the clerk of the court below, and entered on the records of that court, will authorize an execution) ^cannot be a part of the rolls of this court. ' Nor can I perceive how the failure of the clerk to make out and transmit the certificate, can have the effect to retain within the power of the court, a cause which has been finally acted on, and which, but for that failure, would have been out of its power. But if the discretion of this court is so large as to embrace cases in which the certificate of the clerk has not been issued, why should it not embrace cases in which the certificate has been transmitted, but is not yet entered on the record of the circuit court ? Until it is so entered, no execution can issue, nor any further action be had oh the judgment or decree. Are we to hear motions of this kind from parties who will bring proof that the certificate of our clerk, though issued, has not yet been recorded in the court below ?

Further, if the object of reopening the cause be to do justice in the particular case, why should we stop short of the actual termination of the cause by the prevailing party’s putting the fruit of the judgment into his pocket ? The certificate is transmitted and recorded, the execution has issued, and a forthcoming bond has been taken ; but an execution has not yet been awarded on that bond. At that moment, a discovery is made, that the judgment or decree of this court is palpably erroneous : ought not this court, in the exercise of the discretion which is claimed for it, to reopen and review the cause, and correct its own mistakes ? Certainly it ought to do so, on the principles contended for. But we have a recent and express authority that this cannot be done. In the case of The Bank of Virginia v. Craig, a decree was entered against the sureties in a guardian’s bond, who, although they were parties in the court of chancery, were neither appellants nor appellees in this court. An execution was issued ; and mr. Hooe, one of the sureties, had given a forthcoming bond. He applied to this court for a rehearing at a subsequent term ; and surely, *if the court had had the discretion which is now contended for, it would have been granted to him, for a case of greater hardship can hardly be imagined. Yet the court refused to rehear it, on the ground, that “it could not now set aside the decree entered at the former term, whether it was prematurely entered, or whether it was objectionable on its merits, or not.”

I am for overruling the motion. In this particular case, I am satisfied, that little if any injury will be done to the appellee. The court, in its decision, established certain principles, growing out of the facts believed by it to be set forth in the commissioner’s report (which was not excepted to), and remanded the cause to the circuit superiour court, for further proceedings to be had therein according to the principles of the decree ; but it reserved to both parties the right to take any exceptions to the reports of the commissioner, heretofore made, that they might have taken at any former period, consistent with the principles decided by the court. It seems to me, that under the decree it is still competent for the appellee to except,- and to exhibit to the court below, a state of facts (if they exist) different from that which at present appears by the record. If those facts should be varied by the new evidence, the principles established by this court may not apply.

CABEEE, J.

This is an application, by the counsel for the appellee, to set aside an order of the last term, pronouncing a final decree, which has not yet been certified to the court below. The object proposed in setting aside the order is a reargument of the cause ; and the reargument is asked for on a suggestion, most respectfully made, that the court was mistaken in the supposed existence of an important fact, on which its decree was based, when, in truth, as is now alleged, no such fact is to be found on the record. And the application is resisted on the ground, that as the decree is *final, and the term expired, the court has no legal competency to reconsider the case, even although the decree may be palpably and grievously erroneous. I cannot accede to this broad proposition.

The time within which the courts will reconsider their judgments and correct their own errors, has, in my opinion, been regarded as involving a question of judicial discretion, rather than of strict legal power; a discretion to be regulated according to the requirements of justice. For we find that the practice of the courts in respect to this subject, although professed to be regulated by the common law, has been very different at different stages of our judicial history. Thus, Fitzherbert informs us, in his Natura Brevium, p. 49, 50, that, in his day, “ error in the king’s ber ch in the process, where it is the default of the clerks, shall be reversed in the same court by a writ of error sued by the party before the same justices; but not without suing of a writ of error, although it be the same term. But in the common pleas, after judgment given the same term, the justices may reverse their own judgments, upon error in the process, or for default of the clerks, without any writ of error sued forth ; but, in another term, the party ought to sue forth a writ of error thereupon, returnable into the king’s bench. But of an error in law, which is the default of the justices, the same court cannot reverse the judgment by a writ of error nor without a writ of error; but this error” (even although a mere interlocutory judgment, as I understand it) “ought to be redressed in another court, before other justices, by a writ of error. ’ ’ Again, Blackstone says (vol. 3, p. 407) “Formerly the suitors were much perplexed by writs of error brought upon very slight and trivial grounds, as misspellings and other mistakes of the clerks, all which might be amended at common law, while all the proceedings were in paper ; for they were then considered as only in fieri, and therefore subject to the control *of thé court. But when once the record was made up, it was formerly held, that by the common law no amendment could be permitted, unless within the very term in which the judicial act so recorded was done; for during the term the record is in the breast of the court; but after-wards it admitted of no amendment.” Thus we see, that in the earliest stages of the common law, the court of king’s bench could not correct an error of that court, even during the same term, and though the error was the mere default of the clerk, without a writ of error ; and that, as to an error in law in the judgment of the court itself, the same court could not correct it, even during the same term, by a writ of error, nor without a writ of error. In process of time, however, the common law was held to justify an amendment, even of an error in law in the judgment of the court, by mere motion, at any time during the same term, but not after the term. This was a great extension of the common law, by the mere action of the courts, without the authority of any statute. But even this did not satisfy the demands of the public convenience. And we find that the courts proceeded still farther ; for Blackstone adds — “ But now the courts are become more liberal; and, where justice requires it, will allow of amendments at any time while the suit is depending, notwithstanding the record be made up and the term be past. For they at present consider the proceedings as in fieri till judgment is given ; and therefore that, till then, they have power to permit amendments by the common law.” It is true that he further adds — “ But when judgment is once given and enrolled, no amendment is permitted in any subsequent term.” He here alludes unquestionably, to final judgments. But this inhibition of the power of amending final judgments, after the term, would seem to be founded on the statute of 11 Hen. 4, ch. 3, since Blackstone refers to that statute as the authority for the position. That statute declares, *“that the records and process of pleas real and personal, and of assizes of novel disseizin or mortdancestor, and certifications, and of others, whereof judgment is given and enrolled, or anything touching such pleas, shall in nowise be amended nor impaired by new entering of the clerks, or by record, or any thing to be certified or testified, or commandment of any justice whatever, in no term after that such judgment in such pleas is given and enrolled.” But this statute is not in force here; nor have we any similar statute. We are, therefore, at liberty to go as far as the principles of the common law, amended by the spirit of liberality in modern times, will carry us. It is admitted, that even a final judgment, pronounced on the gravest consideration, may be set aside, on mere motion, at any time during the term. This, possibly, may be as far as an inferiour court ought to go; for if an error has been committed by such court, it may be rectified by resorting to a superiour court. But this is the court of the last resort; and when it errs (as err it sometimes must, being human) its errors will be irreversible, unless it be allowed to correct them itself. It will correct its errors, if discovered during the term. Why shall it not do so afterwards ? What magical influence has the lapse of a day, or the expiration of a term, to sanctify error and perpetuate injustice ? There is no law for it, and reason revolts against it.

We have seen, that the inferiour courts thought, for a long time, that they had no power over interlocutory judgments and decrees, after the term. We have seen, that, without the sanction of any statute, they were afterwards induced by a regard to “ the requirements of justice,” to extend their power beyond the term. Upon the same principles, this court ought to extend its power of amending even final judgments, beyond the term ; for otherwise there will be a denial of justice. This ought to be done in those cases at least, where, as in *this case, the judgment or decree has not been certified, and where, consequently, there can be no clashing of conflicting jurisdictions.

Again, this is a suit in chancery ; and this court, in deciding it, sits as a court of chancery. Now, it will be recollected, that all inferiour courts of chancery, although they cannot, after the term, correct their own final decrees on mere motion, yet may do, so by bill of review, long after the term. Shall an inferiour court be thus allowed to correct its own errors, rather than force the parties to the expense and inconvenience of seeking redress in a superiour court, and shall nothing be left to this, the court in the last resort, but to mourn that the injustice it has inadvertently committed is irremediable ? If this be so, it calls loudly for legislative interposition.

It is objected, that if this court were, at a subsequent term, to allow a cause to be reargued that had been finally decided at a preceding term, the frequency of such applications would obstruct the course of business, and would perpetuate litigation. I cannot think that such would be the result. Time cools the zeal of the unsuccessful counsel ; and reflection more frequently weakens, than strengthens, his conviction that this court erred in deciding the cause against his client. I should therefore think, that motions for reargument .would be less frequent after the term than during the term. The right to move for a reargument during the term, has always been exercised at the discretion of the counsel: yet, although I have been a member of this court for more than twenty years, I can confidently affirm, that there have not been as many as twenty applications for the reargument of causes.

It is objected, that the practice of the court has been against the exercise of this power. I am free to admit that the leaning of the court has, generally, been that way. But I do not think it has been invariable. I do *not remember that any case has occurred, where, as in this case, the application was made before the judgment or decree had been certified. The case of Patterson v. Campbell is among the last where an application was made, after the term, to set aside the decree and grant a rehearing ; and in that case, it is believed, the decree has been certified. The application was made on the ground that mr. Johnson had forgotten to mark his name on the docket, as counsel in the case ; in consequence of which, it was taken up and decided in his absence. At the next term, on the application of mr. Johnson, stating these facts, the decree was set aside, and a reargument directed. Now, if the forgetfulness of counsel to mark' himself as such on the docket, be sufiicient to break the spell of the expiration of the term, I cannot perceive why the conviction of the court that it has itself erred, should not produce the same effect.

'Moreover, whatever may have been the practice of the court, it is competent to the court to change it, where it has not been prescribed by positive law.

Upon the whole, I am satisfied that we have the power to set aside the former decree, and grant a rehearing; and that this is a case in which the power ought to be exercised. It might save much time and expense. But the party will not be without redress, even if the rehearing shall be refused. The decree provides, that when the case gets back to the court of chancery, any exceptions may be taken to the report of the commissioner, which might have been made at any former period. It will, therefore, be competent to either party to shew, that the commissioner was mistaken in the facts stated in his report; and if this be done, it will be the duty of the court of chancery to pronounce the law applicable to that new state of facts, without regard to the opinion which this court has pronounced upon a different state of facts.

^BROOKE}, J.

The orders of this court respecting any matter before it, are always in the power of the court, to be corrected or recalled, if necessary, until they are executed. They do not stand on the ground of a judgment or decree, which is out of the power of the court, after the term at which it was entered, and after the order to certify it to the inferiour court has been executed. Until that is done, the order to certify it may be recalled at any time : when that order is executed, the court has no power to recall, and no process by which it can recall, the record, even though the decree of this court may not have been acted on in the inferiour court. Such was the rule adopted by this court in the case of The Commonwealth v. Beaumarchais. That case was argued, and the opinions of the judges delivered, in November 1801. The court directed the reargument in May 1803. The president, Pendleton, in delivering the opinion of the court, said — “ The court is not precluded from correcting the mistake in the former entry, since the record remains in court, and the cause undecided.” If the fact of- the cause being undecided was the reason why the court was not precluded from correcting the.mistake, that might have been done by looking at its own order book. The other was evidently the ground : the record remained in court; the order to certify it to the court of chancery had not been executed there could be no conflicting decrees ; the order to certify it could be recalled without the least inconvenience : and, therefore, the mistake in the decree could be corrected.

There are few cases reported on this point ; and where a rehearing has been allowed, this ground, that the record remained in court, has not been stated. The cases of refusal to rehear have been the most numerous ; and hardly any of them have been reported. The rehearing has been denied on one of two grounds ; either that there was no error in the judgment or decree, or *that the record had been sent ou’t: but however that may be, nothing in language can be plainer, than that the court in The Commonwealth v. Beaumarchais, proceeded on the ground, that the order to certify the decree to the court of chancery not having been executed, the record remained in court, and so the decree, being erroneous, might be corrected ; and when judge Pendleton added, that the cause was undecided, all he could have meant was, that the decree was erroneous. Omissions in a decree may make it as erroneous as errors of commission. If the record had been certified to the court of chancery, the ground that the cause was undecided could not have been taken ; for then there would have been two conflicting decrees of this court certified to the court of chancery.

It is said, that this rule for rehearing the cause so long as the record is not certified to the inferiour court, would operate unequally to suitors, because the clerk may send out the record in some cases, and neglect to do so in others ; that his neglect would leave it in the power of the court to correct its errors in the one set of cases, while in the other, his diligence would take away from the court the power of correction. Still, it must be admitted, that the effect of such a rule would be to do more justice, than'a rigid adherence to the opposite rule, that after the end of the term, no error, however great and palpable, can be corrected. But there is nothing in the objection. The law prescribes the duties of the clerk, and he takes an oath to perform them. He cannot send out all the records uno flatu; some must be postponed to others ; and the manner in which he performs his duty cannot affect the power of the court over its orders and records so long as they in fact remain in court.

The case of Campbell v. Patterson has been mentioned. I did not sit in that case : if I had been present, I might have been against the rehearing. If the record had *been sent out in that case, the case goes further in support of motions to rehear after the term, than any other case decided by the court. The case of The Bank of Virginia v. Craig is not in point; for there the record had been sent out, and the court had no process by which it could recall it; so that if the cause had been reheard, a different decree from the one which had been entered, might have been sent out, and when certified might have been in conflict with the first decree.

Examples drawn from inferiour courts have no application. Their errors can always be corrected by the superiour court; and they themselves have no power of correction after the term has passed, except in suits in chancery, where a bill of review may be filed. Nor are the examples of the courts of king’s bench and common pleas in England, of any force: neither of them is a supreme court, and their errors may be corrected elsewhere.

In every view, I have no doubt of the power of the court to rehear the cause ; and I think it might promote justice to rehear it, and to cha age the decree. But my brother judges incline to the opinion (as I myself do) that under the reservation in the decree of this court, of a right to both parties - to except to the commissioner’s report now in the record, and to any other report that may be made in the cause, justice may be done to the appellee. I have the less reluctance, therefore, the court being equally divided, to pronounce that the motion for a rehearing is overruled. 
      
      It seemed to the reporter, from the examination he was obliged to make of the record, that the alleged mistake of this court as to the matter of fact, though it was by no means obvious, and was easily to be accounted for, was yet quite certain.