Court Opinion

ID: 6697258
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:56:46.126125+00
Date Added: 2024-06-11T16:01:17.473265
License: Public Domain

Plahítibb’s Appeal.
Adams, J.
At the conclusion of the evidence bearing5 upon the issue of partnership the plaintiff made written request that the judge give the jury the following special instruction : “The court holds as a matter *99of law that tbe written contract between tbe defendants, James R. Busb and Hope T. Robertson, of date 14 April, 1927, and tbe contemporary-writings, tbe authenticity of wbicb is conclusively established by tbe pleadings herein, created a partnership between said defendants, and tbe jury is, therefore, directed to answer tbe issue Yes.”
Tbe prayer was declined and tbe issue was submitted to tbe jury and answered against tbe plaintiff.
Inclusion of “tbe contemporary writings” seems to indicate that tbe plaintiff regarded tbe contract as insufficient of itself to establish tbe alleged partnership. These writings consisted of tbe four checks wbicb Busb gave Mrs. Robertson and a signed statement of her financial condition. Tbe plaintiff’s appeal therefore presents for review tbe single question whether tbe papers just referred to and tbe contract signed by James R. Busb and Hope T. Robertson on 14 April, 1927, as explained by Wyche, Busb and Mrs. Robertson, are of such import as to demand compliance with tbe plaintiff’s prayer.
It is difficult to define “partnership” in terms of universal application. There is no one exclusive test wbicb is uniformly recognized. A community of interest in tbe property and a community of interest in tbe profits have been held to be sufficient; but if there is neither of these elements, or if there is only one in tbe agreement, there is no partnership. Day v. Stevens, 88 N. C., 83. Other tests are tbe community of power in tbe management of tbe business and tbe reciprocal relationship of principal and agent. It has been repeatedly said in our own decisions that tbe usual but not tbe universal test is participation in tbe profits and losses of tbe business. Jones v. Call, 93 N. C., 170; Kootz v. Tuvian, 118 N. C., 393; Webb v. Hides, 123 N. C., 244; Bolch v. Shuford, 195 N. C., 660. It is said in other cases that, as a rule, all persons who share in tbe profits of a business incur tbe liability of partners. Motley v. Jones, 38 N. C., 144; Bank v. Odom, 188 N. C., 672. But participation in tbe profits involves liability for tbe losses. Mauney v. Coit, 86 N. C., 463, 470. As expressed by Henderson, O. J., “He who shares in tbe profits, wbicb are nothing but tbe net earnings, should also share in tbe losses, if there be any.” Cox v. Delano, 14 N. C., 89. It is to be noted, however, that these cases contemplate participation in profits as profits — not merely as a means of ascertaining tbe compensation wbicb under tbe contract is to be paid for services or in satisfaction of any other specific obligation. Mauney v. Coit, supra; Fertilizer Co. v. Reams, 105 N. C., 283; Cossade v. Burgwyn, 112 N. C., 304. A partnership is not created by a contract under wbicb one of tbe parties is to have a share in tbe profits of an enterprise as tbe measure of bis compensation for service or attention. Lance v. *100Butler, 135 N. C., 419; Trust Co. v. Ins. Co., 173 N. C., 558; Gurganus v. Mfg. Co., 189 N. C., 202.
One of the considerations recited in the contract made by Bush and Mrs. Robertson is “certain services” which she has performed for him in connection with the “stock brokerage business conducted by him in the city of Asheville.” His agreement to pay and her agreement to accept for her services “one-third the net profits in excess of $1,500 would not, as we have shown, necessarily establish between them the relation of partners. The suggestion in Machine Co. v. Morrow, 174 N. C., 198, that one who shares in the profits of a business either from capital invested or for services rendered, becomes a partner, must be read in connection with this subsequent statement: “It would be otherwise if it were shown that the share in the profits was merely a method of fixing the amount of the salary.”
It would be inaccurate to say that the agreement of 14 April, 1927, conclusively describes the nature of Mrs. Robertson’s service; it would be no less inaccurate to say that the agreement creates a partnership. Suppose, as Mrs. Robertson testified, Bush was to pay and she was to receive $500 a month and a percentage of the profits for the use of the notes ($50,000) which she executed for Bush’s accommodation: the transaction would be a loan by Mrs. Robertson and an agreement by Bush to repay the amount borrowed at all events, and would be upheld as falling within the principle pointed out in Fertilizer Co. v. Reams, supra. The result would not be changed if we should concede that there is evidence tending to establish the partnership relation; the evidence is not conclusive, but subject to rebuttal; and the evidence relating to the actual intention of the parties was submitted to the jury under instructions to which the plaintiff did not except and was determined against his contention.
On the plaintiff’s appeal we find no error.
Appeal by Claimants.
Abams, J.
Some of the defendants in their answers to the complaint set up cross-actions to recover damages against Mrs. Robertson and the plaintiff as trustee of James R. Bush. They allege in general terms that they deposited with Bush, who conducted a brokerage business in Ashe-ville, money and stocks which he received on their account and converted to his own use. In bar of recovery in the cross-actions it was contended that the contracts which the claimants made with Bush are void because in contravention of section 2144 of the Consolidated Statutes. This statute condemns certain contracts for “futures” and declares them to be “utterly null and void.”
*101Charles H. Cocke seeks to recover $21,607.46, alleged to be due him after his stock had been sold and after his account had been charged with certain items he owed Bush. The referee’s findings of fact with respect to this claim occupy four pages. The trial judge approved them and made the additional finding that the claimant did not intend to take-personal delivery of the stock, but did intend that Bush would take charge of his orders, and that he should have the right to pay Bush the balance due if he desired and should be financially able to do so.
The invalidity of the claims in question was set up in the answer of Mrs. Robertson. C. S., 2146, provides that when a defendant specifically alleges that the cause of action is founded upon a contract made void by statute and the answer shall be verified, the burden shall be upon the party asserting the cause of action to prove by proper evidence that the contract is lawful in its nature. The judge held in effect that this had not been proved and concluded that this claim is invalid. His findings of fact are supported by the evidence and are binding upon this Court; and we have discovered no sufficient cause for disturbing his conclusions of law, after considering them in the light of the claimant’s argument and the authorities cited in his brief. Welles v. Satterfield, 190 N. C., 89; McGeorge v. Nicola, 173 N. C., 707.
Other claimants appealed. Thomas P. Cheesborough, Jr., N. N. Beadles, W. E. Day, A. R. Brownson, Hamilton Block, Frank E. Peck-ham, and Frank E. Peckham, assignee, sought to recover the value of certain stocks closed out at the time of Bush’s failure and balances alleged to be due on account of money deposited with Bush, some of them during a long course of dealings in buying and selling stocks. No particular benefit would be derived from a minute discussion of the exceptions entered by the respective parties. There is ample evidence to sustain the finding that Bush operated a “bucket shop” brokerage; that the various transactions were founded upon speculation and based upon “margins”; and that there was no intention of the parties that actual delivery of the stock should be made. We affirm the judgment invalidating these claims and declaring them to be null and void under the statute.
With respect to the claim of R. G. Harris the trial court found the facts to be that the claimant had purchased “curb stocks” of the value of $5,299.25, for which he made full payment at the time of the purchase; that he had left these stocks with Bush, and that Bush had converted them. The court held as a conclusion of law that the claimant is entitled to recover $5,299.25, the value of the curb stocks, but is not entitled to recover $10,995.71, which grew out of transactions prohibited by the statute. The claimant excepted to the latter conclusion.
*102If we concede tbe testimony to be conflicting upon tbe point in dispute there is at least some evidence in support of tbe finding that tbe parties dealt in “futures” based upon “margins,” and did not contemplate tbe actual delivery of tbe stock; and this finding is as conclusive as tbe verdict of a jury. As to this claim tbe judgment is therefore affirmed.
Tbe claims of Jessie H. Hicks, Hannah T. Gaskill, J. W. Easton, and R. L. Raibourne were submitted to tbe jury. These parties filed answers setting up cross-actions for tbe conversion of stock. They contend that because Bush filed no answer to their cross-actions, made no denial of their claims, and did not plead chapter 39 of tbe Consolidated Statutes in bar of their actions, they are entitled to judgment against him.
Tbe plaintiff, as assignee of Bush, alleges that Bush and Mrs. Robertson were partners. These claimants not only admit tbe allegation; they seek to recover a judgment against both. Mrs. Robertson, therefore, is a defendant in these actions. She filed an answer specifically pleading chapter 39 as a defense, thereby shifting the burden of proof to the actors. They bore this burden throughout the trial and could not abrogate it after final judgment.
Upon his findings of fact the referee concluded as a matter of law that all the transactions of R. L. Raibourne were void, except the contract for the purchase of one Tokio bond valued at $780.25. The jury found that Raibourne’s claim was not valid. He then tendered judgment for $780.25. The judge declined to sign it, since the claimant had excepted to the referee’s findings of fact and conclusions of law and the controversy had been settled by the jury. Raibourne excepted. The issues he tendered were framed so as to include the whole transaction, and-the issue submitted to the jury was of equal scope. The motion to confirm a part of the report after the general issue had been answered by the jury was properly denied.
We find no reversible error in the instructions complained of in the sixth, seventh, ninth, tenth, eleventh, and twelfth exceptions, or in the court’s refusal to give the prayers referred to in the thirteenth, fourteenth, and fifteenth assignments of error. Welles v. Satterfield, supra; Burns v. Tomlinson, 147 N. C., 634.
No error.