Court Opinion

ID: 8639672
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:51:06.843967+00
Date Added: 2024-06-11T16:56:03.532501
License: Public Domain

WILKINS, District Judge.
A motion is made in this case to dismiss tlie libel for want of jurisdiction, on the ground that the article of agreement, for the breach of which the li-belant seeks to recover damages, was a covenant of partnership.
The answer of the respondent sets forth the agreement, by which it appears, that the libel-ant and Samuel Ward, now deceased, were at the time of the execution of the agreement, tin* joint owners of the steamboat Detroit; and agreed "to allow the respondent to run the same between the Sault Ste. Marie and Peu-tanguishine. during the sailing seasons of 1S52 and 1858 — in a lino with and under the control and management" of the respondent, who was authorized to appoint the officers and crow, with the exception of the clerk, who was placed under the control of the Wards, and was to make reports to them of the receipts and expenditures of the boat every two weeks. The receipts were to be applied, first, to the payment of all expenses for the crew, fuel, repairs and supplies; second, to the payment of tlie money advanced for insurance; third, to the payment of the sum of $(¡.000 to the Wards; and lastly, the sum remaining alrer these payments was to lie equally divided 1 let ween tlie parties to the contract: the respondent being allowed, out of the earnings ol' said boat, over and above the division last specified, the sum of "SHihi per annum for liis services as agent of the boat." T'nquestionabiy this agreement constituted thr Wards and the respondent part-tiers in the profits of the business in which the *210steamer was to be employed. Tlieir interest In the profits or losses of the adventure was joint and of the same nature. But they were not joint owners of the boat, which was, by the express terms of the agreement, chartered to the respondent for the consideration of $<¡.000, which was to be paid to the Wards antecedent to any division of the profits. Until that sum was paid we think the partnership did not commence. This view accords with the opinion of Chief Justice Robinson, in the case ol' Thompson v. Ward, decided in the court of queen's bench of the province of Upper Canada. In that case, Thompson sought to recover from the Wards, freight and passage money earned by the Detroit “directly after she was chartered by the plaintiff” (Thompson), and to which the defendants (Wards) objected, setting forth this agreement. The court held, that Thompson could not recover this freight and passage, money, because the Wards were entitled to it, not as partners, but as owners of the chartered vessel. Mr. Justice Robinson expressly saying, “that this money should go towards liquidating the $0.000. which would then accelerate the period when Thompson would be entitled to share with the Wards the earnings of the' boat, and, in respeta to all earned after that period, they would be partners.” Such is the language of the opinion. Certainly, if this freight and passage money had been paid into the clerk's office by a third party, and Thompson could not recover it by suit against the clerk, the Wards could; and if so, the libelant can recover the same from Thompson as part of the consideration agreed to be paid for the charter of the boat. Until this money was realized by the Wards, to the extent specified by the third clause in the agreement, the fourth constituting them partners, could not operate, and until then, Thompson was but tlieir bailee or agent.
[The cause was subsequently heard on the merits, and a decree entered dismissing the libel. An appeal was taken to the circuit court, where the decree of this court was affirmed. Case unreported. Subsequently the libelant appealed to the supreme court, where the decree of the circuit court was affirmed, with costs. 22 How. (G3 U. S.) 33U.]
With these views, the court deems it unnecessary to pass upon the proposition stated in the argument, that the construction of the agreement is res adjudicata. The records of the queen's bench, show that the question was not presented by the pleadings. It arose incidentally. on the statement of counsel, and a verdict ■ was entered, with the understanding, that on the production of such an agreement as was stated, at a subsequent term, the verdict would be set aside, as to the amount for which credit was claimed. But. as on a careful consideration of the opinion of Chief Justice Robinson. I am not enabled to see wherein he pronounces the entire agreement between those parties a covenant of partnership, any further than as to the profits accruing subsequent to the payment of the $<¡.000. and concurring therein at present in such construction, it is unnecessary to announce any judgment of this court as to the estoppel of the proceeding here on the part of the libellant. In overruling the present motion I feel less reluctance than I should was this a final determination of the questions raised. The language employed lty the comraoting parries certainly rendered the instrument they executed somewhat equivocal. Their intention, though clear as to the "sharing of the earnings,” upon a certain contingency, is somewhat obscure as to whether the writing should be considered as a charter party on specified stipulations, or as a covenant of co-partnership. My mind is not free from doubt; but as no injustice can arise from the further prosecution of the cause and entertaining jurisdiction, the objections raised will be held under reservation. At any stage of the proceeding. until final hearing, the question of jurisdiction is open; and if, on further and more full consideration of the able argument of the proctor of the respondent, and the cases cited by him, I should see ground to change the opinion now expressed, the proceedings will at once be dismissed. As at present advised I must refuse the motion. Motion denied.