Case Name: Trunick versus Gilchrist
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1874-10-26
Citations: 81 1/2 Pa. 160
Docket Number: 
Parties: Trunick versus Gilchrist.
Judges: Before Agnew, C. J., Sharswood, Williams, and Mercur, JJ.
Reporter: Pennsylvania State Reports
Volume: 81 1/2
Pages: 160–163

Head Matter:
Trunick versus Gilchrist.
1. Plaintiff lent money to defendant, who was a member of a firm with which plaintiff had dealings, which firm was indebted to defendant. At the time of the loan plaintiff was negotiating to enter into a firm with one of the other partners; the loan was to go into the firm if consummated. The defendant did not know of this arrangement. The partnership was not consummated, and plaintiff charged the loan to defendant’s firm, but defendant received no corresponding credit from his firm. Held, that plaintiff could recover from defendant as his individual debt.
2. Defendant could not set-off his claim against his firm against his notes to the plaintiff, for want ofv mutuality.
3. There being no arrangement between defendant and the plaintiff and the other partner to allow his claims against them, he could not set off as by mutual contract.
4. Defendant was not a creditor of plaintiff, and had no defence to plaintiff’s individual claims.
October 14th, 1874.
Before Agnew, C. J., Sharswood, Williams, and Mercur, JJ.
Error to the District Court of Allegheny County, No.' 100, to October and November Term, 1874.
This was an action of assumpsit, brought July 20th, 1878, by J. M. Gilchrist against James Trunick! The cause of action was on the following instruments, viz.: Promissory note dated July 15th, 1870, at twenty-eight months, for $240, from James Trunick,defendant, to Jesse Reed, indorsed by him and defendant. Due bill, dated November 2d, 1872, for $720, from defendant to plaintiff, and check of plaintiff, dated November 20th, 1872, on Farmers’ and Mechanics’ Bank of Birmingham, to defendant for $20.
The case was tried March 10th, T874, before White, A. E. J.
The plaintiff gave the instruments in evidence, testified, that they were loans to the defendant, and rested.
There was at that time a firm existing as J. W. Reed & Co., of which the defendant, Jesse Reed and J. W. Reed, were the partners.
For the defendant Jesse Reed testified that he asked the plaintiff to let defendant have some money, which he did ; there' was no particular arrangement about it; the plaintiff had agreed to go into partnership with them. After defendant had got the money, plaintiff' said to witness he would charge the money against the firm if he went in ; he never consummated his partnership; he never went in ; defendant did- not know of this arrangement; plaintiff' made a statement of the money in the firm account. The firm owed the Birmingham Bank; the $240 was an accommodation note to be discounted at that bank. Witness made arrangement for the $720 in the due bill. Plaintiff was to take up the $240 note if the partnership was consummated ; there was nothing said what was to be done if the partnership was not consummated; the arrangement for the partnership was to embrace the loans.
J. W. Reed testified that plaintiff said he had charged the loans to the firm; witness assented and said the firm owed Trunick money; the plaintiff said it was right.
Defendant testified that he borrowed the money to meet the debt of Jesse Peed and the firm; the firm was then largely indebted to defendant; he did not get the money for himself. Defendant proposed to give plaintiff’ a receipt; he said he had no money of the company, he would pay his own money, taking defendant’s due bill till he got money in from the company.
There was evidence that plaintiff had made an arrangement, partly carried out, for the purchase of a coal mine and its business, with' which the firm of J. W. Peed & Co. were connected, and in which he had paid some money and received some of its proceeds.
Plaiutiff in rebuttal testified. He charged these sums in view of trying to -get it out of the firm ; he gave the money on Trunick’s credit, but charged it to Jesse Peed’s account, in expectation that it would be settled in that way.
The account of plaintiff was in evidence showing these three items charged against the firm.
There was evidence also of the existence of a partnership of J. W. Peed and the plaintiff, which had been dissolved on or previously to May 2d, 1873.
The defendant’s points were:
1. If the jury believe from the evidence that the plaintiff charged the firm of Peed & Gilchrist with the $720 due bill, the $240 note, and the $20 check, and the said firm acquiesced in the same, and were indebted at the same time to defendant in a large amount, and defendant wished the same paid for him by said firm, and if after the time the same was so .charged plaintiff and said firm made said agreement of May 2d, 1873, then the plaintiff' cannot recover for any of said amounts.
2. If the jury find that the firm of J. W. Peed & Co., and under them their successors Peed & Gilchrist, were largely indebted to defendant, and that the plaintiff, either as a partner or agent of said firm, kept his own money and the money of the said firm all in the Farmers’ and Mechanics’ Bank of Birmingham in one account, in his own name, and that the said note for $240 was an accommodation note, owned and held by said bank, was paid at maturity to said bank by plaintiffs check on said joint fund, then plaintiff is not entitled to recover from defendant the amount of said note.
The Court answered:
The first point above is affirmed if the jury find from the evidence that the charges were made in pursuance of an agreement to that effect, and were intended at the time to be a settlement of said claims. But if the charges were made conditionally, as testified by plaintiff, and not as a payment or satisfaction of the same, then the plaintiff did not relinquish his claim against the defendant, and is not estopped from a recovery by the fact of such charge.
The second point is refused. It is a question of fact for the jury upon the evidence, whether the plaintiff paid the note as partner or agent for the firm, or as a loan on his own account. Besides the uncontradicted evidence is, that it was not lifted until some time after maturity.
The verdict was for the plaintiff for $1057.42. The defendant sued out a writ of error, and assigned for error the answer to his points.
J. R. Large and R. Woods, for plaintiff in error.
8. A. MoClung and A. M. Brown, for defendant in error.

Opinion:
Judgment was entered in the Supreme Court, October 26th, 1874.
Per Curiam :
Gilchrist lent his own money to Trunick and the claim in suit was individual. It was true he had a credit entered to himself in the books of the firm of Reed & Gilchrist, with a view to get his money. But Trunick ,was no party to this, and received no corresponding credit for his claims against the old firm of the Reeds. The alleged partnership between the younger Reed and Gilchrist was only conditional, according to the testimony of Reed, wdio was called as a witness by Trunick, and Gilchrist, who so testifies.
This conditional arrangement was submitted to the jury and found by them. Hence there can be no pretence that Trunick, who was no party to the credit on the books, as between Reed and Gilchrist, stood as a creditor of the conditional firm of Reed & Trunick. He could not set off his claim against the firm of the Reeds, against the individual notes to Gilchrist, because of their want of mutuality, and not having shown that there was an arrangement between himself and Reed and Gilchrist to allow his claims against them, he cannot claim a. set-off by mutual contract. He was in no way a creditor of Gilchrist, and consequently had no defence to these individual claims of Gilchrist. We discover no error in the record, and the judgment is therefore affirmed.