Case ID: nys_27/html/0606-01.html
Source: Caselaw Access Project
Author: {"author": "PEATT, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

(75 Hun, 585.)
    ROWLAND v. ROWLAND.
    (Supreme Court, General Term, Second Department.
    February 12, 1894.)
    Reverence—Action at Law.
    Where a complaint states a good cause of action at law, but erroneously prays judgment for an accounting, the action will be regarded as at law, and a reference may be granted if the examination of a long account is involved.
    Appeal from special term, Kings county.
    Action by Charles L. Bowland against Thomas F. Kowland for an accounting of the transactions of the Continental Works, in which name the complaint alleged that plaintiff and defendant were associated together, and were engaged in the business of general engineering and contracting, and iron construction. From an order referring the action for hearing and determination, on the ground that it involved the examination of a long account, defendant appeals. Affirmed.
    The following is a copy of-the complaint, omitting the caption:
    (1) That between the 1st day of February, 1881, and the 12th day of July, 1887, the plaintiff and the defendant were associated together in the business of general engineering, contracting, and iron construction, under the name and style of the “Continental Works.” (2) That said business was carried on under an agreement between the plaintiff and the defendant, in the nature of a general partnership or quasi partnership, whereby the plaintiff agreed to contribute his time, services, and skill to said business, and the defendant the capital, and the business theretofore owned by him, and it was agreed that the defendant should have the general management of said business. It was further agreed that the plaintiff should draw the sum of thirty dollars per week, and should be entitled to a percentage of the net profits in addition thereto. Plaintiff’s percentage of profits for the first three years was agreed to be two-, per cent., the fourth year four per cent., and for the balance of the period five per cent., of the net profits. (3) That from time to-time, during said periods, a provisional or partial statement of the profits of said business was made for the purpose, solely, of fixing an amount which-plaintiff might safely draw from said business, under said agreement, in addition to said weekly drawings, and with such amounts, as was shown by such provisional or partial statements, plaintiff was credited; but that said statements, so made, were not intended by either party to be final, but were merely temporary, and made for the convenience of the parties. The last credit made to the plaintiff upon the books of the said Continental Works was, as plaintiff is informed and believes, on or about the first day of February, 1886, and made a total of credits upon the books of said concern upon the profit account of the plaintiff of $8,804.56, as plaintiff is informed and believes. (4) On or about the 12th day of July, 1887, the defendant stated to the plaintiff that the said Continental Works had made no profits since the last previous statement had been prepared and credit given to the plaintiff, but, on the contrary, had sustained heavy losses, sufficient to wipe out any balance of profits unaccounted for in previous statements, and that the sum then standing upon the books of the Continental Works to plaintiff’s credit was all that could, in any event, be due to plaintiff, and, at the same time, tendered plaintiff a check for the balance, as shown by said books; and the plaintiff, having no knowledge of the financial condition of the said Continental Works, and relying entirely upon the word of honor of the defendant, who had complete knowledge of the finances of said concern, and the possession, control, and oversight of all its papers, contracts, and books of account, accepted said check, and gave, as he believes, a receipt in full of all demands. (5) The plaintiff has since learned that it was not, in fact, true that the said Continental Works had made heavy losses, that no profits had been made, or that the previous undivided profits had been wiped out, as stated to plaintiff by defendant, but that, on the contrary, large profits had been made, and, as plaintiff is informed and believes, large sums had, by defendant, been charged to loss account, upon the books of the concern, which were not properly chargeable to said Continental Works or to plaintiff; and that, in fact, upon a proper accounting, a large sum will be shown to the credit of the plaintiff in addition to that already credited to him, but what amount plaintiff is unable to state, owing to the fact that the books of account of said Continental Works are in the hands of the defendant. (6) That the defendant well knew, as plaintiff is informed and believes, when he told plaintiff that there was nothing more due him, that such was not the fact, and said statement was made for the purpose of deceiving and defrauding the plaintiff, and inducing him' to give a receipt in full; that the plaintiff relied upon said statement in accepting said check and giving said receipt, and was deceived thereby, and great loss and damage will come to plaintiff, as he is informed and believes, if the said payment and receipt shall be held to be a release and settlement. Wherefore the plaintiff prays that an accounting be had of the profits of the said Continental Works during the period aforesaid, and upon said accounting a statement of all the transactions of said concern be made, wherein proper debits and credits shall be made, from the books, contracts, and papers of said Continental Works; and that plaintiff may have judgment for such sum as he may appear, upon said accounting, to be entitled to; and that he may have such other and further relief, both by intermediate or final order and by interlocutory judgment or final decree, as may be just, and as to equity pertaineth, besides the costs and disbursements of this action.
    Argued before DYKMAN, PEATT, and CULLEN, JJ.
    Lockwood & Hill, (L. A. Lockwood, of counsel,) for appellant.
    Lyon & Smith, for respondent.
   PEATT, J.

The complaint states a good cause of action at law, and erroneously prays judgment for an accounting. The answer states that plaintiff was never a partner in defendant’s business, but was an employe upon a salary, the amount of which was to be determined by the profits of the business. The answer is thus consistent with the allegations of the complaint. Both the complaint and answer show a proper case for a reference. The defenses of payment and release will not, in the ordinary course, be put in evidence until the plaintiff has established his cause of action, to do which he requires a trial before a referee. Order affirmed, with $10 costs to abide the event. All concur.