Case Name: ANDREW ANDERSON, Respondent, v. ALFRED R. ANDERSON, Appellant
Court: Utah Supreme Court
Jurisdiction: Utah
Decision Date: 1902-10-15
Citations: 25 Utah 164
Docket Number: No. 1356
Parties: ANDREW ANDERSON, Respondent, v. ALFRED R. ANDERSON, Appellant.
Judges: BABTCH, J., concurs.
Reporter: Utah Reports
Volume: 25
Pages: 164–168

Head Matter:
ANDREW ANDERSON, Respondent, v. ALFRED R. ANDERSON, Appellant.
No. 1356.
(70 Pac. 608.)
Partnership: Settlement of Account: impeachment: Fraud, or Mistake: Pleading.
The party seeking to impeach the settlement of a partnership account for fraud or mistake must set out in his pleading the particular facts constituting the fraud or mistake relied on,, and evidence of facts not alleged is inadmissible.
(Decided October 15, 1902.)
On Rehearing.
FORMER OPINION AFFIRMED, AND JUDGMENT' BELOW REVERSED.
For former opinion, see 24 Utah 497; 68 Pac. 319.
Roach v. Gilmer, 3 Utah 389, 4 Pac. 221; Dunham v. Travis, 25 Utah 65, 69 Pac. 468.

Opinion:
BASKIN, J.
A rehearing was granted in this case on the question whether, under- the pleadings, the plaintiff could introduce evidence to prove that the written agreement, which on its face showed a settlement by the parties of their partnership affairs, and which was pleaded by the defendant in bar of the action, was obtained through mistake. The facts are fully stated in our former opinion (24 Utah 497, 68 Pac. 319), in which we held that, under the provisions of the Code of Civil Procedure, such evidence was not admissible under the pleadings; and, to have rendered such evidence admissible, the plaintiff should have obtained leave of the court to amend his complaint by inserting therein the facts which constituted the alleged mistake. It is a well-settled principle that a settlement of accounts may be impeached for fraud or mistake, but the burden is upon the party seeking to impeach it to set out in his pleading the particular facts constituting the fraud or mistake relied on; and, in the trial, evidence of other facts than those alleged is not admissible. This principle is as applicable to practice under the modem Codes of Civil Procedure as it is in equity practice. The case of Cross v. Bank, 66 Cal. 462, 6 Pac. 94, like the one at bar, was an action for an accounting. The answer of the defendant set up a final settlement. The complaint did not allege fraud or mistake in the settlement, or seek to set it aside. The trial court excluded evidence offered by the plaintiff to show the true balance of the account between the parties. This was assigned by the appellant as error; also the refusal of the court to permit the plaintiff to amend the complaint by inserting in it allegations of fraud or mistake committed by the defendant bank in failing to credit the accounts of plaintiff with large sums of money deposited by him. The Supreme Court held "that the offered evidence was properly excluded, because it was irrelevant to the issue on the trialalso, for special reasons, which do not affect the question under consideration, sustained the lower court in refusing to permit the plaintiff to amend the complaint. In the opinion, the court, after quoting the following from the opinion of the Supreme •Court of the United States, to-wit: "And in equity the rule is well established that an account once settled cannot be avoided or impeached by any of the parties to the settlement, except by an action in equity to set aside the settlement for fraud, or to surcharge and falsify the account for mistakes or errors. Chambers v. Goldwin, 9 Ves. 254; 1 Edw. 1, 293," — said: "Unless assailed 'in that way by one of the parties, the settlement is conclusive." See, also, Clarkson v. Hoyt (Cal.), 36 Pac. 382; Hendy v. March, 75 Cal. 566, 17 Pac. 702; Auzerais v. Naglee, 11 Cal. 60, 15 Pac. 371; Branger v. Chevalier, 9 Cal. 353; McMahill v. Jenkins, 69 Mo. App. 279; Barker v. Hoff, 52 How. Prac. 384; Weeks v. Hoyt, 5 Hun 347; Hoyt v. Clarkson, 23 Or. 51, 31 Pac. 198; Roach v. Gilmer, 3 Utah 389, 4 Pac. 221; Dunham v. Travis, 25 Utah 65, 69 Pac. 468; Liscomb v. Agate, 67 Hun 390, 22 N. Y. Supp. 126. The case of McMahill v. Jenkins, 69 Mo. App. 279, was also an action for an accounting. The complaint failed to charge either fraud or mistake in the final settlement alleged in the answer. A reply is permissible under the Missouri Code. The plaintiff filed a reply. The court, in its opinion, said: "The plaintiff, by his reply, tacitly admits the settlement, but seeks to avoid it by alleging his sickness and inability to examine the partnership books at the time of the settlement. He does not allege fraud in the settlement, but avers that omissions were made of charges'that should have been made against the' defendant, and a failure on the part of the defendant to render just and true accounts of the partnership property and funds. Plaintiff cannot amend his petition by his reply. The affirmative relief he desired should have been pleaded in his petition. He should have pleaded the settlement in the petition, and asked' that it. be surcharged and falsified upon some equitable grounds. He cannot ingraft this additional equity upon his bill by a reply, under any recognized rules of pleading." In Barker v. Hoff, 52 How. Prac. 384, the court says that "the rule always has been that where, upon a general bill for an accounting, the defendant sets up a stated account in bar, the complainant will not be permitted to show mistakes or errors in snob account, but must amend bis bill, as tbe settled account is prima facie a bar to tbe suit until specific errors are assigned." Tbe ease of Weeks v. Hoyt, 5 Hun 347, was an action for an accounting. Tbe complaint alleged a partnership and its. dissolution, a demand for settlement made by tbe plaintiff of defendant, tbe defendant's refusal, and prayed for a settlement of the partnership accounts. Tbe answer set up a final settlement by the parties. Tbe court, at general term, held tbat "as the plaintiff did not deny tbe -settlement, as alleged and proved by defendant, and did not allege such errors as would obviate it, such settlement was a good defense, and tbe plaintiff could not recover under bis complaint; tbat even though the settlement was, in some respects;, erroneous, it could not be disregarded, under the pleadings, nor could tbe judgment upon tbe referee's report stand, because tbe case and bis findings showed a settlement forbidding such general accounting as tbe referee bad given to tbe parties; tbat tbe plaintiff could only recover according to tbe allegations of bis complaint; and tbat an amendment, sueb as would be necessary to retain jurisdiction, would be too sweeping and radical to be allowed at this stage of tbe litigation." Tbe case of Hoyt v. Clarkson, 23 Or. 51, 31 Pac. 198, was an action for an accounting. Tbe defendant pleaded a settlement in bar of tbe action. Tbe plaintiff did not, in bis pleadings, allege fraud or mistake in tbe settlement. Tbe court, in tbe opinion, said: "Tbe giving of a promissory note is prima facie evidence of an accounting and settlement between tbe parties of all demands between them up to tbe time of tbe execution of tbe note. Tbe presumption is only prima facie, and is liable to be explained; but until' explained it is to- be taken as true, and affords sufficient evidence tbat at' its date tbe maker owed tbe payee the amount named in tbe note. Tbe presumption is in favor of tbe correctness of tbe settlement, and that tbe note given for tbe balance ascertained on sucb settlement expresses tbe truth. Hence tbe general rule tbat a settled account will not be opened on mere conflicting evidence, and that, when opened, errors or omissions not alleged will not be considered, though there may be some evidence tending to prove them. In such ease the party claiming that there were any errors or mistakes must allege, either in the complaint, or an equitable counterclaim in the nature of a cross-complaint, that it was obtained by fraud or through mistake." This rule applies with equal force to the written agreement of settlement in the case at bar.
It follows that the judgment rendered by us on the former hearing should stand. It is accordingly so ordered.
BABTCH, J., concurs.