Daily capital journal. (Salem, Oregon) 1903-1919, 1911-05-24
Armstrong V. HOllen, Gillian
COnntY.

NOuniys
G. F. Armstrong, respondent, V. A.
S. Hollen, Appellant. Appeal from
the circuit court for Gillian county.
Hon, w. L. Bradshaw, Judge. Ar
gued and submitted at Pendleton,
May 1, 1911. Jay Bowerman for re-
spondent T, A. Weinke for appel
liant. Burnett, ]. Reversed.
The complaint in this action has
two counts for money alleged to have
been loaned by the plaintiff to the
defendant at different dates and two
counts wherein the plaintiff claims
as the assignee of a firm consisting
of himself and r. Il Armstrong for
materials furnished and services rem
dered by that firm for the defendant,
amounting to $61.20 and the further
sum of $739.15 for barley sold and
delivered by the firm to the defen-
dant The answer denies every allie
cation of the complaint except that
Armstrong and Armstrong we're CO.
partners as stated and that the al
legged assignments of that firm to the
plaintiff we're made as set forth. For
a further and separate answer the
defendant AYERS in substance that he
and the plaintiff entered into a CO.
partnership known as the Condor
Milling company; that it was agreed
by them that the plaintiff was to be
silent partner and that the moneys
charged in the complaint to have
been loaned to the defendant and the
materials and services rendered and
bo hop pIn e, 4
delivered to the defendant were all
furnished by the plaintiff to the Con-
don Milling Company as and for the
plaintiffs contribution as silent
partner to the capital of the firm.
The court below sustained general
demurrer to the new matter in the
answer and the defendant declining
to an nd the action was neat1 urun
the general issue raised by the de-
mails end resulted in a verdict and
judgment in favor of the plaintiff in
the sum of $11764S. The defendant
appeals.
Burnett, j.: A contribution to the
capital Of a firm by a partner does
not constitute a loan to the other
partner In such transaction the
title to the money or property so
contributed passes to the firm from
the partner advancing 1t and he must
look for reimbursement to the sue
cess of the partnership venture. No
Indebtedness exists between the part
ners as to the partnership until 1t Is
wound up, the firm indebtedness dis
charged and a balance. ascertained
between the partners. Not until then
under such circumstances can an in
| debtedness arise. II is possible in
| deed for one partner to lend money
to firm AS applied to this case
! loan to the firm would not be loan
to the individual partner The part
nership is an entity distinct from
either partner, The fallacy OF the
plaintiffs argument lies In the as
sumption that the affirmative matter
Of the answer is plea in abatement
which is waived when Joined with the
| general isue. II as a matter Of fact,
as alleged in the new matter OF the
answer, the money. grain, materials
and services mentioned in the COM
plant were contributions to the capt.
tai of the Condor Milling Company,
they could not constitute a loan as
charged in the complaint and the es-
tablishment Of the allegations Of new
matter in the answer would be bar,
not an abatement, of the action A
/ judgment in favor of the defendant in
such a case would leave the plaintiff
| free to bring his suit in equity to
wind up the partnership and state an
account of it's affairs. Such a suit
might result in. the declaration Of a
balance in favor Of the plaintiff after
the extinction Of the Indebtedness OF
the firm, but not until the balance
was ascertained would there be any
Indebtedness from the defendant to
the plaintiff and then 1t would be an
Indebtedness arising from the con-
tract Of record, to-wit, the decree of
the court declaring such a balance in
favor Of the plaintiff
II was error to sustain the demur-
rer TO the new matter in the answer.
The judgment Of the court below Is
reversed and the cause remanded for
further proceedings not Inconsistent
with this opinion.
A girl who knows she IS pretty