Case Name: Russell and another against Green
Court: Connecticut Supreme Court
Jurisdiction: Connecticut
Decision Date: 1834-07
Citations: 10 Conn. 269
Docket Number: 
Parties: Russell and another against Green.
Judges: The other Judges were of the same opinion, except Peters, J., who was absent,
Reporter: Connecticut Reports
Volume: 10
Pages: 269–280

Head Matter:
Russell and another against Green.
In a bill in chancery brought by A and B, against C, for an account, it was stated, that A, B and C, mutually agreed to purchase, and purchased accordingly, a quantity of pine lumber, to be owned and paid for, in these proportions ; one fourth by A, one fourth by B, and one half by C; to be shipped to New-York, and there disposed of by C, who was to pay over the net avails to the persons concerned, according to their interests respectively. The committee found the agreement as stated, and that, in pursuance thereof, A and B purchased, each, one fourth part of a certain quantity of pine lumber, and C one half of the same quantity, and in connexion with D, a further quantity, besides some oak and chesnut lumber on his individual account; all which he shipped to New-York, in 1816, consigned to E for sale ; that soon afterwards, C gave A and B a receipt, stating that they owned a certain number of feet of the pine lumber shipped to i?, and were entitled to receive the net avails of the average of such lumber, according to their proportion, when sold or accounted for by E; that C did not inform E, that the lumber was owned by different persons, and did not direct him to keep separate accounts ; that the pine lumber sold readily, but there . was more delay about the oak and chesnut; that C received, from time to time, considerable sums of money from E, but no account; that in 1822, C made a compromise with E, taking his notes for a certain amount, and a deed of 500 acres of land in Virginia, for the remainder ; that thesenotes and this deed were taken in the name of C, without any instructions from the other persons concerned; that the business was done by C in this manner, as he stated, for the greater convenience of transacting it, and was done in good faith, and was, as he believed, the best arrangement that could be made ; that previous to the 8th of March, 1830, and on that day, C paid A and B 204 dollars, as their share of the avails of the lumber, and, at the same time, tendered them a conveyance of half of the Virginia lands ; that A and B received the money, but refused to accept it in full of their claims, and also refused to take any part of the Virginia lands ; and that the net avails of A and B’s share of the lumber, were 662 dollars, the balance, after deducting the money paid, being 458 dollars. Held, 1. that the case was within the reason, if not within the letter of the rule, that where there are more than two partners, resort must be had to chancery to settle their accounts, and consequently, there was not adequate remedy at law; 2. that the joint interest alleged in the bill, was supported by the finding of the committee ; 3. that the money received by C, from E, may fairly be inferred to be avails of the joint concern ; 4. that C, under the circumstances of the case, was not authorized to take the Virginia lands in part satisfaction of the claims of A and B; 5. that the reception of 204 dollars by A and B, was not a ratification of the act of C; 6. that C was bound to account with A and B for the net avails of their share of the lumber, and the balance of such avails being found to be 458 dollars, they were entitled to recover that sum; and 7. that great delay having intervened, not satisfactorily accounted for, they were also entitled to recover interest on such balance.
Middlesex,
July, 1834.
This was a bill in chancery for an account. The bill stated, That on the 6th of February, 1816, John C. Russell, Warren Russell and Timothy Green purchased 200,000 feet of pine lumber, for the sum of 3000 dollars, which was to be held, owned, and paid for, in the following proportions, viz. the Russells one quarter, each, and Green one half; that on the 1st of September, 1816, it was mutually agreed between these parties, that Green should ship this lumber to the city of New-York, and there dispose of it, and pay over the net avails thereof to the Russells, in proportion to their respective interests therein ; that during the months of October and November, 1816, Green shipped to the city of New- York all of said lumber, and there disposed of it for the sum of 3000 dollars, exclusive of the expenses of transportation and sale, and applied the proceeds to his own use, without paying over to the Russells any part thereof; that the Russells have since, by themselves and their agents, made repeated application to Green to come to a full and fair account of the sales of said lumber, and to pay over to them, each, their proportion of the avails thereof, but that he has at all times refused and neglected to do either.
The court appointed a committee, who reported the following facts. In February, 1816, John C. Russell, Warren Russell and Timothy Green mutually agreed to purchase 100,000 feet of pine scantling, to be held, owned and paid for, by the parties, in these proportions, viz. one fourth part, by each of the Russells, and one half, by Green ; and in pursuance of such agreement between themselves, they contracted with Reuben Chapman, that he should sell and deliver to them at East-Haddam, said 100,000 feet of pine scantling. Chapman having on hand a greater quantity of lumber, Green purchased, on his own account, such further part thereof, as with his half of said 100,000 feet, would make him the owner of one half the whole lot: the Russells, from the same lot, purchased and paid for the stipulated quantity. In the months of September, October and November, 1816, before the lumber was divided, Green shipped to New- York, in his individual name, consigned to Andrew Jackson, 124,941 feet thereof, which was owned as follows : 45,657 feet, by the Russells ; 20,642 feet, by Chapman; and the remainder, 58,642 feet, by Green. During the same period, Green shipped to Jackson 93,751 feet of oak and chesnut lumber, owned wholly by himself.
Previous to the shipment, a contract was made between Green and Jackson, that the latter should dispose of this lumber and such other lumber as Green might send him, to the ' best advantage, on Green's account; that he should charge 62⅛ cents per M. cartage, and 10 per cent, commissions for selling, and that he should render his account of sales, when required. On the 22nd of January, 1817, Green executecj . delivered to the Russells a receipt, stating that they owned 45,657 feet of the pine scantling shipped to Jackson, and were to receive the net avails of the average of such lumber, according to their proportion, when sold or accounted for, by Jackson, agreeably to the contract made with him. In the consignment and sale of that part of the lumber which belong-, ed to the Russells, Green acted as their agent.
In the year 1817, at different times, Green shipped to Jackson a further quantity of oak and chesnut lumber, amounting to 110,527 feet, and a quantity of other lumber, consisting of staves, &c, of the value of 246 dollars, 83 cents, owned wholly by himself, to be sold in like manner as the lumber previously sent; which he charged in his account with Jackson. The inspection and cartage of the whole of the lumber, and the freight of the lumber sent in 1816, were paid by Jackson ; but not the freight of the lumber sent in 1817. He also paid to Green, on account of the sales of the lumber, at different times and in various sums, the amount of 2610 dollars, 69 cents.
No settlement was made with Jackson until November, 1822, when Green went to Neio- York, and finding some small parcels of the lumber unsold; that a considerable amount of debts for lumber sold remained uncollected ; and fearing that he might lose, by a longer delay in the settlement, he made a settlement with Jackson, by compromise ; Jackson agreeing that he would give Gree?i his note for 100 dollars, payable on the 1st of May, 1823, and another note for 50 dollars, payable on the first of August, 1823, and convey to him a certain tract of land, containing 500 acres, in the county of Bath and state of Virginia; and Green stipulating to discharge Jackson from all further claims on account of the lumber shipped to him. Jackson gave the notes accordingly, and afterwards paid them ; and also conveyed to Green said tract of land. The whole of this business with Jackson, was done by Green, in his own name ; and the land was conveyed to him alone.
It did not appear, that any account of sales had been rendered by Jackson ; nor was there any evidence shewing at what times, nor for what precise sums, the different parcels of lumber were sold. It was, however, proved, that nearly all the pine lumber was sold in the years 1816 and 1817.
In 1817, the price of lumber fell; and much delay was oc- easioned by the difficulty of disposing of the oak and chesnut, and of collecting the debts due for the lumber sold. There was no evidence that either of the Russells ever gave any directions respecting said settlement, or even knew of it, until after it was made. In making it, however, Green acted with good faith, and did what, under the circumstances, he conskh ered best for all concerned.
In addition to said sums of 2610 dollars, 69 cents, and 150 dollars, paid by Jackson to Green, he paid the further sums of 127 dollars, 82 cents, for the inspection of the lumber; 541 dollars, 73 cents, for the freight of the lumber sent in 1816 ; and 105 dollars, 77 cents, for the cartage; making the whole amount paid by Jackson, on account of the lumber, 3536 dollars, 6 cents. Green applied the moneys paid by Jackson as follows: 2,719 dollars, 90 cents, in payment of the oak and chesnut timber, staves, &c., owned by himself; 302 dollars, 13 cents, in payment of the pine lumber belonging to Chapman ; and the remainder, being 514 dollars, 3 cents, he proposed to divide between the Russells and himself; and accordingly, on the 5th of March, 1830, he paid to the Russells S4 dollars, with the interest thereon, which, with the 120 dollars previous^ ly paid, he claimed, was their full share of the moneys received from Jackson, and, at the same time, offered them a conveyance, of one half of the Virginia lands. The Russells received the 84 dollars and interest, but refused to accept the same in full of their share of the avails of the lumber, claiming a larger sum, and also refused to take any part of the Virginia lands. At this time, Green stated to the Russells, that he considered himself as having a right to pay his own private debt against Jackson, in preference to the joint claim of himself and them ; that he took the land for their benefit, as well as his; and took the conveyance in his own name, for the greater convenience in transacting the business.
In computing the balance, after deducting his own and Chapman's private claims, Green mistook the amount, and did not pay the Russells as much as he intended; yet as he deducted his own and Chapman's private claims from the gross amount paid by Jackson, instead of the net amount after deducting the expenses of freight, inspection and cartage, the committee found, that if, in the opinion of the court, he was legally entitled to apply the moneys received of Jackspn in payment of his private bill and Chapman's bill of lumber, and then divide the residue between himself and the Rus-sells, he had paid them their share of the cash avails of the lumber, and they were only entitled to their share of the Virginia lands. But if the court should be of a different opinion, and should decide, that the Russells were not bound to take any part of the Virginia lands, then Green had no right to apply the moneys received of Jackson in the manner specified, and the Russells were entitled to recover the net avails of their part of the lumber; which ought to be computed at 662 dollars, 35 cents ; and from that sum ought to be deducted the two sums paid by Green, amounting to 204 dollars, leaving a balance still due from Green to the Russells of 458 dollars, 35 cents; and, in the opinion of the committee, interest ought to be computed upon that sum from the 1st of January, 1819. But if the court should be of opinion, that a still different rule ought to be adopted, in the division of the moneys and lands received of Jackson, and that they ought to be divided among the owners of the lumber sent to Jackson, in proportion to their respective interests therein, the committee found, that the net avails of their respective shares ought to be computed as follows: the share of the Russells, 662 dollars, 35 cents; Green's share of the pine lumber, 857 dollars, 4 cents ; his share of the oak and chesnut lumber, staves, &c., 2719 dollars, 90 cents, amounting in the whole, to 3576 dollars, 94 cents; and Chapman's share, 302 dollars, 13 cents. But as Green has paid Chapman for his share of the lumber, the amount of that share ought to be added to Green's share, thereby making, in the whole, the sum of 3879 dollars, 7 cents.
The net amount of moneys received of Jackson, over and ábove the charges by him paid for inspection, freight and cartage, is 2760 dollars, 69 cents; and of that sum there has been paid to the Russells 204 dollars.
The questions of law arising upon these facts, were reserved for the advice of this Court.
Barnes and & Clark, for the plaintiffs,
contended, That of the three modes of adjusting the accounts between the parties, presented by the committee, the second was the only one consistent with the facts and the equity of the case.
The correctness of the first mode depends upon the assumed right of the defendant to pay himself for his private bill of lumber, then to pay Chapman for his bill of lumber, and then to divide the balance between himself and the plaintiffs. This is inadmissible ; because the plaintiffs had no interest in any part of the lumber, except the pine, and that was sold for cash. They are entitled to stand upon an equality with the defendant, in the distribution of this cash. Besides, the defendant, as agent of the plaintiffs, neglected his duty, and exceeded his authority. He is not to be regarded with favour, for several reasons. First, he did not keep clear and regular accounts of his transactions, and communicate their results, from time to time, to his employers. Pal. Ag. 46, 7. Secondly, he did not keep the property of his employers separate, but mixed it with his own private property ; and now, through his own fault, he is unable to make a distinction. Pal. Ag. 47. 1 Madd. Ch. 103. Thirdly, he compounded and commuted debts, without authority, express or implied. Pal. Ag. 220, 1. Kingston v. Kincaid, 1 Wash. C. C. Rep. 455.
The plaintiffs are not bound, in any event, to accept the lands in Virginia. They never authorized or ratified the act of the defendant in receiving those lands. It is not the usual course of trade to sell lumber for land. The plea of necessity is repelled, by the fact, that the defendant, at the time of the compromise, took the notes of Jackson on time, without security. Neither Jackson, nor the debtors for the lumber, appear to have been insolvent.
The third mode of adjustment suggested by the committee, is inequitable ; first, because the plaintiffs never consented, expressly or by implication, to stock their pine lumber with the oak and chesnut lumber of the defendant, and to run the hazard of the delay and other contingencies attendant upon the sale of the whole ; and secondly, because the plaintiffs, for the reasons already assigned, are not bound to take any part of the lands in Virginia.
From the facts found the defendant cannot claim the benefit of accounting in anything but money; and, as the delay to account is imputable to him, interest follows of course. Pal. Ag. 48, 9.
The defendant cannot claim indulgence, by shewing that Jackson was guilty of neglect. Jackson was a subordinate agent; There was no privity between him and the plaintiffs. The defendant was a surety for Jackson. Pal. Ag. 48. 6.
The defendant is not entitled to consideration because he acted in good faith, when he blade the compromise with Jackson. If loss ensues from the Unauthorized act of an agent, it furnishes no defence to him, that he intended the benefit of his principal. Pal. Ag. 4, 5. If the defendant wished to be exempt from the responsibility which thg law devolves upon an agents he should have consulted his employers, from time to time, and taken their directions.
The balance, which the committee find to be due to the plaintiffs, is not too great. It is less than the actual balance. The defendant has furnished a rule for ascertaining it, by paying to Chapman, for his part of the pine lumbey 302 dollars, 13 cents. The proceeds of the lumber of the plaintiffs^ by this rule, are 668 dollars, 26 cents. Deduct for payments, 204 dollars, the balance is 464 dollars, 26 cents; on which interest is to be computed from January 1st, 1819.
Storrs and Bulkley, for the defendant,
contended, I. That the bill was insufficient, there being adequate remedy at law, by an action of account.
2. That if the bill be sustainable, the decree should be, that the avails of the lumber and the land be divided among the parties in proportion to their interests.
3. That the interest found by the committee does not correspond with that alleged in the bill; the committee having found a joint interest, whereas the bill states a separate interest.

Opinion:
Williams, J;
The defendant objects to this report, in the first place, that it appears upon the bill itself, that there is adequate remedy at law. It is certainly very late to take this exception, after the appointment of a committee, and a report of that committee, and all the attendant expenses have been incurred. If the court were satisfied, that it had no jurisdiction, I do not see but this objection would be fatal. But it has been decided, that wherever there are more than two partners, resort must be had to chancery to settle their accounts; as that is the only forum that can examine and adjust them in a single suit. The contract shewn in this bill seems to be of that nature; though it is not so denominated.
These parties agree to purchase a quantity of pine lumber, to be held, owned and paid for, in these proportions : John and Warren Russell one quarter, each, and Green one half; Green to ship it to New- York, dispose of it, and pay over the net avails according to their interest. Of course, there was a community of interest in this lumber; as there was nothing to distinguish one part from another. The net avails were to be paid over. Each, therefore, was to share in profit and loss; which is the ordinary test of partnership. Saville v. Robertson, 4 Term Rep. 720. And without determining that these individuals would have been liable as partners for the lumber purchased, I think they would as partners have been liable for its freight to New- York. Post & al. v. Kimberly & al. 9 Johns. Rep. 470. At all events, whether partners or not, such difficulties exist in settling an account of this kind at law, that I cannot-say» there is adequate remedy there. This objection, then, cannot prevail.
Another objection has been made, that the interest found by the committee, does not correspond with that alleged in the bill: that the committee have found a joint interest, and the bill shows a separate interest in the owners of this pine lumber. The committee do, indeed, findj that after the lumber had been sent to New- York, Green executed to the Russells a receipt, stating the quantity they owned, and that they were to receive the net avails of the average of said lumber agreeably to their proportions, when sold, &c. They also find, that the lumber was purchased, to be held and paid for in the following proportions, viz. John C. Russell one fourth, and Warren Russell one fourth, each, and Timothy Green one half. This is precisely as stated in the bill. If the receipt, therefore, imported any thing to the contrary, as that is merely evidence, and perhaps but part of the evidence, the court must look to the facts as found by the committee. It is believed, however, there is nothing in the receipt inconsistent with the charge in the bill. That is a charge of a joint interest, stating how, upon settlement, the proportions are to be adjusted.
We come to the question upon what principle is this account to be settled. There is to be a loss, or Virginia lands must be taken. It seems, that in the year 1816s Green shipped this lumber to the care of one Jackson ; that soon after, he consigned to him a quantity of oak and chesnut lumber of his own ; and it does not appear, that he ever informed Jackson the lumber was owned by different persons, nor directed him to keep separate accounts ; that the pine lumber sold readily, but there was more delay about the oak and chesnut; that Green received, from time to time, considerable sums of money from Jackson, but no account; and that in 1822, he made a compromise with Jackson, took his notes for a certain amount, and a deed of 500 acres of land in Virginia for the remainder; and that these notes and this deed were taken in his own name, and without any directions from the others concerned ; but that it was done in good faith, and was, as he believed, the best arrangement which could be made.
Now, had Jackson known, that this property was owned by different persons, it would have been his duty to keep separate accounts of the pine and oak lumber. Then, it \tould have been ascertained what part of the money was received upon the joint account and what upon the separate account; what debts were lost upon one, and what upon the other'. These facts are not, and probably cannot now be, ascertained ; and this may justly be ascribed to the neglect of Green in not giving this information. Until, then, Green shall shew, that the moneys received from Jackson, were received from the sales of his own lumber, it is fair to infer, that they were the avails of the joint concern. Paley on Agency, 47. As he has thus put it out of the plaintiffs' power to ascertain the facts, it is perfectly reasonable, that they should be taken against him ; but as the committee have not found whether the full amount of the pine lumber was received before the compromise, it is necessary to look to the effect of that compromise.
The lumber of the this sells and Green was principally sold in the year 1817, or before. Green sent it in his own name, and kept the account in his own name. A settlement was not effected until almost five years had elapsed. He then took notes in his own name, and a deed of land in his own name. Is it not a fair presumption, that he considered himself accountable to the other owners 1 But he declared, that he took the land for their benefit, as well as his, and took the deed in his own name, for the greater convenience in transacting the business. Had he a legal right to do this ? I will not say, that in the intercourse of business, an emergency might not arise, where no time could be allowed to consult with those interested, and no other property could be had, but that a person, under peculiar circumstances, might make a compromise of a claim of this sort, which a court of equity would sanction. But where no sudden emergency requires it; where there is ample opportunity to consult those interested, and it is omitted ; and especially, where a compromise is made, by taking notes and deeds in his own name only ; it would be unsafe to hold such a transaction to be obligatory upon persons in no other manner parties to it. And although, in this case, Green has conducted with perfect good faith, yet the precedent sought to be established, would serve as a cover for those, who, with the same opportunity, but with less integrity, should seek to advance their own interests at the expense of others. It is analogous to the case of a trustee, who buys in the trust property ; which has often been hold-en to be invalid, although done from the best motives, on ac count of the danger of fraud.
It was hinted, that by accepting the 84 dollars, the plaintiffs had ratified this transaction. But when we look at the facts, it is found, that Green offered them 84 dollars and a conveyance of part of the land ; and when they refused to receive the land, and refused to receive the 84 dollars in full, it is perfectly apparent, that it was not his expectation nor their intention, that the 84 dollars should be in full. And there is no rule of law construing an act of this kind, coupled with an express refusal to accept it in full, into an agreement to receive it in full, or a ratification of the act expressly refused to be ratified. Green, then, having received moneys, to a considerable amount, for the pine lumber, and lands to his satisfaction for the balance, is bound to account with the plaintiffs for the avails of that lumber; the balance of which the committee have found| to be 458 dollars, 35 cents. This sum the plaintiffs are entitled to recover. The committee recommend, if this principle is adopted, that interest be allowed from the 1st of January, 1819. As it appears, that most of the pine lumber was sold in 1817 ; as great delay has intervened ; and as this delay is not satisfactorily accounted for; I should think it proper, that interest should be allowed; and would advise the superior court to accept the report of the committee, and grant the prayer of the biU, and allow the plain tiffs the sum of 458 dollars, 35 cents, with interest from the 1st of January, 1819.
The other Judges were of the same opinion, except Peters, J., who was absent,
Judgment for plaintiffs,