Withers v. Withers

ON appeal from the circuit court of the United States for the county of Alexandria in the District of Columbia.

The case, as stated in the opinion of the court, was as follows:

This case comes up on appeal from the circuit court of the united States for the county of Alexandria, in the district of Columbia.

The bill filed by the appellee in the court below, alleges, that, on or about the 7th of March 1815, the parties to this suit entered into co-partnership, as merchants in trade, in the town of Alexandria, under the firm and style of J. and R. Withers. That the complainant, John Withers, was to furnish to the firm fifteen thousand dollars, and to receive three-fourths of the profits of the business; and the defendant, Reuben Withers, was to furnish five thousand dollars, and receive one fourth of the profits; and in case of loss, it was to be borne in the same proportion, and that each party was to pay his own individual expenses. That the business was continued, upon the same terms and conditions, in all respects (the name and style of the firm having been changed to that of John Withers & Co.), until the 13th of December 1819, when it was dissolved by mutual consent, and upon certain terms, which need not be here stated. The bill then alleges that the complainant, never having received a satisfactory account of the disbursements and transactions of the defendant whilst in New York, as a member of the firm, they were excepted out of the settlement of the partnership concerns, and the defendant agreed to render a true, full and just account of all his purchases and transactions in New York, as a member of the said firm, and that he should be exclusively liable for all debts and engagements which he might have contracted or made in the name of said firm, and for which they had not received full benefit. And the bill charges that the defendant had failed and neglected to render such account, and prays that an account may be taken of such disbursements, dealings and transactions; and that the defendant may be decreed to pay over to the complainant what, if any thing, upon the taking of such account, may be found due to him.

The defendant, in his answer, admits the partnership was entered into upon the terms and conditions stated in the bill, and avers that he regularly transmitted to the house at Alexandria invoices of all goods purchased in New York, and that the same were entered on the books of the firm, which are in the possession or under the control of the complainant. The defendant admits that it was stipulated in the articles of co-partnership that each party was to pay his own individual expenses, which, as he alleges, was meant and intended to apply when the parties were at home, and not travelling on the business of the firm. And he expressly avers that all the funds put into his hands were well and faithfully applied to the objects for which they were remitted and received. The defendant also admits, that upon the dissolution of the partnership, he did agree to render a full, true and just account of all his purchases and transactions in New York, as a member of and on account of said firm, and to be liable for all debts and engagements which he may have entered into (if any) on account of said firm, and for which the said firm may not have received full benefit and advantage. And avers that he has fully complied with his engagement to render such account, and submitted the same for examination; and that the account, when examined and corrected, was balanced, as he thinks, on the books of the company, which are in the possession or under the control of the complainant. And that there is no debt due in the city of New York or elsewhere from the said firm, contracted by him, the defendant; but that every such debt, contract or engagement, so far as he knows or believes, has been paid off, satisfied and discharged.

The cause afterwards being set down for hearing, was, on motion of the complainant, referred to a commissioner, to state and settle the partnership accounts between the parties.

Upon the coming in of the report of the commissioner, sundry exceptions were taken, and argued by counsel; all of which were overruled by the court except one, which related to the defendant's charge for his expenses in New York, amounting to one thousand seven hundred and fifty-six dollars. The exception to this charge was allowed, and the cause referred back to the commissioner, with directions to allow the defendant his reasonable travelling expenses to and from New York, and the necessary difference between the expense of living at New York and at Alexandria.

The case was argued by Mr Neal, for the appellant; and by Mr Key, for the appellee.

Mr Neal claimed to reverse the decree of the circuit court, because the expenses of the appellant in New York, while engaged in the business of the firm, had not been allowed. On this point he cited, 16 Johns. Rep. 15; 1 Atk. 7, 8; 3 Atk. 176; Domat. Civil Law 155, 158, 159, art. 9, 11, 12; 1 Swanston's Rep. 465; 1 Peters 383.

The expenses were clearly chargeable to the firm, but if they were not, there was a subsequent ratification of the charge. Cited, 9 Cranch 155, 160; 7 Cranch 92; 2 Hen. and Munf. 544; 4 Hen. and Munf. 273.

The bill and answer did not put these expenses in issue, and will not warrant the decree. Cited: 4 Munf. 273; 6 Johns. Cases in Err. 559; 7 Peters 130; Harrison's Chancery 299.

Mr Key, contra:

The bill is for an account by one partner against another. The agreement set out in the answer is the only evidence of it. He contended that the agreement gave no claim to the expenses. The appellant would have been subject to expenses had he remained in Alexandria, which would not have been a charge to the firm; those incurred in New York should be on the same footing.

Mr Justice THOMPSON delivered the opinion of the Court.