Case ID: ad_120/html/0637-01.html
Source: Caselaw Access Project
Author: {"author": "Kellogg, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Stephen Schuyler and Susan D. Schuyler, Appellants, v. Thomas Cullen, Respondent.
    Third Department,
    June 25, 1907.
    Partnership — accounting — liability for firm debts—loss by fire after dissolution.
    Although a partnership agreement provides that at the termination of the partnership one partner shall receive a stated sum for his interest in “ icehouses, tools and property of said firm,” he .remains nevertheless- liable to share with his fellow-partners the losses of the firm, and when these have not been fully-paid he is not entitled to a judgment,for the agreed price of the icehouse.
    . The loss caused by the destruction of the icehouse by fire after the termination of the partnership falls upon the partners who agreed to purchase it, and the selling partner is entitled to credit for the purchase price. '
    Appeal by the plaintiffs, Stephen Schuyler and another, from a judgment of the Supreme Court in favor of the defendant, entered in the. office of the clerk of the county of Albany on the 22d day of January, 1907, upon the decision of the court rendered after a trial at the Albany Trial Term, certain questions. of fact having been submitted to the.jury.
    Since, the taking of the appeal in the above-entitled action the defendant, Thomas Cullen, has died, and Mary A. Cullen, as administratrix, etc., of Thomas' Cullen, deceased, has been substituted as defendant. ' ■
    
      David A. Thompson [Arthur L. Andrews of counsel], for the appellants.
    
      Frederick A. Chew [William W. Morrill of counsel], for the respondent.
   Kellogg, J.:

The plaintiffs seek to dissolve a copartnership and for an accounting. October 31, 1898, a partnership agreement was made between the parties, to begin November first of that year and continue for three years, in the business of cutting, harvesting and selling ice.. Among other things, it was agreed that' the icehouses * , * *• shall be insured and kept in good order and repair, and after the . payment of all expenses and charges for the conduct of said business the gains and profits thereof shall be divided between the said patties in equal .shares. At the end or sooner determination of this* 'agreement * * ' * the other partners shall pay to, and said Thomas Cullen shall receive, the sum of ($1,600) for all his interest- in the icehouses, tools and property of said firm, and that said firm shall carry on the business substantially as heretofore conducted by the firm of E. P. & S. Schuyler & Cullen.” Usually the ice was harvested in the winter and the crop thus harvested was sold during the summer, but it remained in the icehouses until after November 1, 1901, the time fixed in the agreement for the' termination of the copartnership. In September, 1902, the ice was sold by the plaintiffs, in the name of the firm, at a greatly reduced price, the purchaser having the right to leave it in the icehouses until December, 1903. In September, 1903, the icehouses, tools and- ice were destroyed, by fire. -The houses were insured under the agreement until after November 1, 1901, but were not insured at the time of the fire; The purchase price of the ice was paid and was applied upon the. indebtedness of •thefirm. The firm debts are not yet fully paid. The court determined that the copartnership was dissolved November 1, 1901, and •wasnot continued or extended, and that thereupon the icehouses, tools and other property of the copartnership belonged to the plaintiffs and they became indebted to the defendant for his interest therein in the sum of ,$1,600, and directed judgment for that a-mo.unt with interest against the plaintiffs. It is evident that the business was unsuccessful and that instead of profits there were losses and that the.losses have not yet been fully paid. The interest in the icehouses, tools and property for which the defendant was to receive $1,600 was his interest in the fixed property or plant and did not include the ice or the unsettled partnership accounts. Those matters were a part of the business of the company, ■ and are not included within the terms “icehouses,' tools and property” as used by the parties in their contract.. - The ice.accounts due the firm and the obligations of the firm were not included in that provision for sale, and ■ -the defendant is liable to share with the plaintiffs, under the agreement, the losses or profits of the business itself.

The plaintiffs contend that the icehouses,' tools and fixed property were not transferred under the agreement, for the reason that the icehouses "were occupied by the company’s ice, and that, therefore, the loss by fire fell upon the partnership, and not upon the plaintiffs. But it is evident by the terms of the agreement that the title of the property was to pass on November 1, 1901, upon payment of the $1,600. Nothing was to be done by the defendant, and in the accounting between the parties the defendant is entitled to credit for the $1,600. The judgment is, therefore, reversed and a new trial granted, with costs to the appellants to abide the event.

" All concurred.

Judgment reversed on law and facts, and new trial granted, with costs to appellants to abide event.