Opinion
No. 39779.
January 3, 1956.
1. Partnership — limited partnership — evidence — insufficient to disclose any profits.
In suit between alleged partners, evidence established that complainant had no title or interest in the physical gin plant and was insufficient to disclose any net profits as to which complainant had a limited partnership interest.
Headnote as approved by Roberds, P.J.
APPEAL from the Chancery Court of Tallahatchie County; R.E. JACKSON, Chancellor.
Breland Whitten, Sumner, for appellant.
I. Where matters of fact in the bill of complaint are not denied by the answer, otherwise than by the general traverse, they are taken as admitted at the hearing. Morris v. City of Columbia, 184 Miss. 342, 351, 186 So. 292; Sec. 1291, Code 1942; Griffith's Miss. Chancery Practice, Secs. 348-49 pp. 13-14.
II. There can be no estoppel as between the parties themselves, where neither of the parties has been misled by the conduct or acquiescence of the other, although they may be estopped as to third persons, nor generally when the party claiming the estoppel has knowledge of the facts. Day v. McCandless, 167 Miss. 832, 142 So. 486; Plant Flour Mills Co. v. Sanders Ellis, 172 Miss. 539, 157 So. 713; 19 Am. Jur., Sec. 86 p. 742; 31 C.J.S., Sec. 71 pp. 270-71; 68 C.J.S., Sec. 21 p. 442; Vol. III, Pomeroy's Equity Jurisprudence (5th ed.), Secs. 804-05.
III. Proof of partnership may be made by the admissions of one of the partners. Barwick v. Alderman (Fla.), 35 So. 13; 68 C.J.S., Sec. 53 p. 471.
IV. It is not necessary that an agreement to form a partnership be in writing. 40 Am. Jur., Sec. 21 p. 140.
V. The statute of frauds does not apply where real property is purchased for the use of the firm. National Union Bank of Maryland v. National Merchants Bank of Baltimore (Md.), 27 L.R.A., Subsecs. (c) (d) p. 478, et seq.; 49 Am. Jur., Sec. 218 p. 543.
VI. Title to real property taken in the name of a single partner in partnership business constitutes partnership assets. Sample v. Romine, 193 Miss. 706, 8 So.2d 257; 40 Am. Jur., Sec. 103 p. 200; Anno. 75 A.L.R. 980; 68 C.J.S., Sec. 72 (2) p. 507.
VII. Irregularities in the proceedings or report of a master are reached by motion to set aside, or by similar appropriate motions. Brooks v. Robinson, 54 Miss. 272; Fowler v. Payne, 52 Miss. 210; 30 C.J.S., Sec. 553 p. 945.
George P. Cossar, Charleston, for appellee.
I. Appellee by original answer, amended answer, and answer to special interrogatories has in every respect satisfied all requirements of an answer, to wit: fullness, certainty, responsiveness and consistency.
II. The proof in this record shows conclusively that no partnership existed between the parties. First National Bank v. Williams, 142 Oregon 648, 20 P.2d 222, 226; Doodson v. Bumpers, 224 Ala. 390, 140 So. 766; Sauls v. Scott, 46 Ga. App. 243, 167 S.E. 311; Jones v. Davis, 181 Ark. 265, 25 S.W.2d 434; U.S. Champlin v. Commissioner of Internal Revenue, 71 F.2d 23; Wickham v. Commissioner of Internal Revenue, 71 F.2d 527; Crum v. Crum, 43 So.2d 392; Cox v. Fielding, 130 So. 164; 40 Am. Jur. 136; 68 C.J.S. pp. 414, 429.
III. The proof in record shows conclusively that the relation of parties was that of master and servant. The Texas Co. v. Jackson, 174 Miss. 737, 165 So. 546; Buescher v. Schmidt, 209 Iowa 300, 228 N.W. 26; Joslin v. Idaho Times Pub. Co., 56 Idaho 242, 53 P.2d 323; U.S. Brown v. Minngas Co. (Minn.), 51 F. Supp. 363; Kent v. State, 143 Ark. 439, 220 S.W. 814; Atchison T. S.F. Ry. Co. v. Dickens, 103 S.W. 750; Harris v. Threefoot (Miss.), 12 So. 335; 35 Am. Jur. 445; 56 C.J.S. 24.
IV. The proof in record shows conclusively that appellee is the owner of the gin in question. Wright v. Sullivan, 207 Miss. 250, 42 So.2d 185; White v. Turner, 197 Miss. 165, 19 So.2d 825; Barclay v. State, 156 Ala. 163, 47 So. 75; Thanos v. Thanos, 313 Ill. 499, 145 N.E. 250, 252; Sec. 832, Code 1942; 40 Am. Jur. 196; 68 C.J.S. 513; 73 C.J.S. pp. 182, 215.
V. The doctrine of estoppel applies as to the appellant. Commissioner v. Tower, 327 U.S. 280, 164 A.L.R. 1135; Campbell v. Mims, 149 Ky. 101, 147 S.W. 932; Gibboney v. Derrick, 338 Pa. 317, 12 A.2d 111; Siegrist v. O'Donnell, 182 S.W.2d 403; Roberts v. Roberts, 113 Colo. 128, 155 P.2d 155; Guthrie v. Foster, 256 Ky. 753, 76 S.W.2d 927-32; 40 Am. Jur. pp. 178, 187; 68 C.J.S. 442.
Appellant is called B.P. and appellee is called Rice throughout this record. We will so designate them in this opinion.
B.P. filed the bill herein asserting in himself as against Rice one-half ownership, as an equal partner, in a certain described cotton gin plant, consisting of the building, machinery and equipment, and the lot on which the gin was located, situated in Charleston, Mississippi, known as the Electric Gin Company, and also asserting that he was an equal partner with Rice in all profits which had arisen out of the operation of the gin from 1945 to 1949 after repayment to Rice, out of such profits, all moneys he, Rice, had paid upon the purchase price of the gin plant and to aid in its operation for the time mentioned.
Rice, in his written pleadings, denied that B.P. was a partner, or the owner of any interest whatever, in the physical plant, but admitted that B.P. was an equal partner in the profits from its operation after repayment out of such profits to Rice of the money he had paid on the purchase price and in the operation of the gin. However, he alleged there had been no such profits.
As B.P., the complainant, began to introduce his testimony, counsel for Rice asked permission of the court to amend his pleadings so as to deny that B.P. was a partner to any extent in the profits and also to assert that B.P. was merely his employee. The record does not disclose that the chancellor acted upon this motion.
Considerable testimony was taken before the chancellor. He found and adjudicated that B.P. had no title to, or interest in, the physical gin plant, but he also adjudicated that B.P. was a partner with Rice to the extent of one-half of the profits from the operation of the gin after repayment to Rice out of such gross profits of the moneys he had advanced in the purchase of the gin plant and in its operation. However, he did not ascertain the profits. He appointed a certified public accountant as commissioner to do that.
The master reported that he had carefully examined the evidence introduced at the trial, including all oral evidence and all records and exhibits; that he had requested in writing of both parties that they furnish him additional records, documents, or other evidence of (1) profits, if any, realized by the gin during its partnership operations, (2) partnership money which had been collected, appropriated and used by B.P., (3) and partnership money Rice had co-mingled with money he had realized from operation of enterprises other than the gin; that neither had furnished any such evidence. The master then found that, from the evidence, documents, records, and data, at hand he was unable to say that B.P. was entitled to recover any amount. He also found that neither party had come into court "with clean hands" and that they were in "pari delicto," and he recommended that the bill be dismissed.
There was a hearing before the chancellor on this report, at the end of which, the chancellor dismissed the bill and assessed the costs of the proceedings, including the allowance to the master, equally between the parties. From the decree adjudicating the partnership rights of the parties and the decree approving the report of the master, B.P. appeals.
In the first decree of the chancellor adjudicating that B.P. had no title to, or interest in, the physical gin plant, the chancellor observed that there was substantial conflict in the evidence on that question. He resolved that conflict in favor of Rice. The record discloses ample testimony to sustain that conclusion. Indeed, the great weight of the testimony, in our opinion, considering the documents, book records, actions of the parties, and the certainty and uncertainty of the oral testimony, supports the finding of the chancellor.
The chancellor held that B.P. had a limited partnership interest in the profits. That was all B.P. asserted he owned as to the profits. Therefore, the confusion in Rice's pleadings — admission in the written plea that B.P. owned that limited interest and his oral motion to deny B.P. owned any interest whatever — is immaterial so far as B.P. is concerned.
The report of the master that he could not ascertain what profits, if any, were made through operations of the gin, and what amounts were wrongfully appropriated, or used, by the two parties, and whether Rice had been repaid, and, therefore, whether there were any net profits, is amply sustained by the record before us, and the chancellor was justified in accepting and approving that report. (Hn 1) The burden was, of course, upon B.P., the complainant, to make out his case. We agree with the report of the master and the decrees of the chancellor to the effect that he did not meet that burden.
Affirmed.
Lee, Holmes, Arrington and Ethridge, JJ., concur.