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Ozeas v. Johnson

4 U.S. 374 4 Dall. 374 Court SCOTUS English

Delivered by Tilghman, C. J.

Contents

Majority

p. 374
Ozeas v. Johnson, administrator of Foulke.[1]

Syllabus

Partnership.
One partner cannot maintain assumpsit against the other, to recover the balance of the proceeds of a partnership adventure, unless the partners have settled their account and struck the balance.
Case for money had and received, &c. The plaintiff and Foulke, the intestate, had been jointly concerned in a mercantile adventure from Philadelphia to New Orleans ; but there was no evidence at the trial, that they had ever settled their accounts ; and this action was brought to recover a balance claimed by the plaintiff. The jury, accordingly, gave a verdict in his favor for §320, subject to the opinion of the court, on a point reserved ; to wit, whether the plaintiff, being a partner of Foulke’s, and equally concerned in the adventure, could recover in the present form of action ?
On arguing the point reserved, S. Levy, for the plaintiff,
urged that the action of account-render was almost obsolete : that the action for money had and received was in nature of a bill in equity ; that having no distinct- court of equity, equity had become, in effect, a part of the common law of Pennsylvania, administered through her common-law courts ; and that the sense of the legislature, on the subject, was manifested in the 6th section of the act of the 1st of March 1806 (P. L. 562), which provides, “that in all cases where any suit has been brought in any court of record within this common-*4351 tbe same shall *not be set aside for informality, if it appear, that the process has issued in the name of the commonwealth, against the defendant, for moneys owing or due, &c.” (Wats. on Part. 221; 2 Ves. 239; 1 Bac. Abr. 31, 36, 37; Cowp. 795; 1 Dall. 428 , 211.)
Hopkinson, for the defendant,
admitted, that if a partnership is dissolved, and the partnership accounts settled, the creditor partner may bring an action on the case for the balance (Wats, on Part. 221, 226); but he contended, that as this was the case of a special partnership, in which no account of the joint adventure had been settled, an action of assumpsit could ncit be sustained. (Wats. 116; 2 T. R. 476, 478, 479, 483; 2 Caines 293 , 296; Lamalere v. Caze, in the circuit court of the United States, 1 W. C. C. 435.)

The opinion of the court was delivered by the Chief Justice, on the 1st

p. 375
of January 1807, who, Laving stated the facts and point reserved, proceeded as follows:

— It was my wish to support the action, if possible ; because the jury have decided on the merits of the cause. But upon a deliberate consideration of the nature of the action, and .the.authorities which have been cited, I am convinced, that the plaintiff cannot recover. Money received by one partner, during the partnership, is not received for the use of either, but for the use of both the partners. All that either partner is entitled to, is a moiety of what remains, after all the partnership debts are paid ; and the proper remedy for one partner against the other, to obtain a settlement and payment, is an action of account-render. In short, no case has been cited by the plaintiff’s counsel, to show that an action like the present can be maintained, unless the partners have settled their account and struck the balance.[1]

It is, then, of importance to the administration of justice, that the forms of action, which originate in good sense and public convenience, should not be confounded. The defendant has a right and an interest, to insist upon the preservation of the proper form of action, to enforce his partnership contract against him, of which this court possesses no power to deprive' him. It is, indeed, most convenient, that partnership accounts should be settled before auditors. It would often be extremely difficult, sometimes it would be impracticable, to settle them by a jury. For these reasons, we think, that plaintiff cannot maintain the present action.

(a) (a) An actual settlement must be made and a balance struck, by the act of both parties, before either can be charged in an action of assumpsit. It is not sufficient, that the balance may be deduced from the partnership books. Andrews v. Allen, 9 S. & R. 241. Until a partnership is dissolved, the accounts of the partners liquidated, and a balance struck, one partner cannot sue another in an action Of indebitatus assumpsit. Lamalere v. Caze, 1 W. C. C. 435. 1

Footnotes

  1. 1 One partner cannot l’ecover in assumpsit, against another, for advances, until a Settlement of the partnership accounts, without proof of an express promise to pay, though the partnership has ceased to exist. Leidy v. Messinger, 71 Penn. St. 177 . And assumpsit will not-lie by one partner, to recover from the other, a balance due upon the settlement of their partnership account, without proof of an express promise. Killam v. Preston, 4 W. & S. 14 . Otherwise, if an account be stated and rendered, which is returned without objection, for upwards of a year. Preston v. Killam, 1 Am. L. J. 168. And see Patton v. Ash, 7 S. & R. 116; McFadden v. Hunt, 5 W. & S. 458 ; Roberts v. Fitler, 13 Penn. St. 265 ; Ferguson v. Wright, 61 Id. 258. The law is otherwise, where there is a partnership, as to a single transaction; in such case, a creditor partner will not be put to his action of account-render. Galbreath v. Moore, 2 Watts 86 ; Wright v. Cumsty, 41 Penn. St. 102 ; Finlay v. Stewart, 56 Id. 183 ; Meason v. Kaine, 61 Id. 335; Cleveland v Farrar, 4 Brewst. 27.

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