October 10, 2012

Thompson's Admx. v. Thompson, Laurel, 1902


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66 S.W. 1007; 1902 Ky. LEXIS 541; 23 Ky. L. Rptr. 2214

March 5, 1902, Decided


Appeal from circuit court, Laurel county.

Action by W. H. Thompson against J. M. Thompson and others to recover damages for the wrongful conversion by defendants of plaintiff's interest in partnership property. Plaintiff dying pending the action, the same was revived in name of his administratrix. Judgment for plaintiff, and defendant J. M. Thompson appeals.


COUNSEL: Henry C. Hazelwood, Chas. R. Brock, and J. W. Alcorn, for appellant.




 [*1007]  PAYNTER, J. This action was brought by W. H. Thompson against the appellant, J. M. Thompson, and Jasper Pearl and W. M. Wadkins. It is averred in the petition that the plaintiff and defendants named were copartners doing business as coal operators under the firm name of Pearl, Thompson & Co. The plaintiff sought to recover more than $3,000 on account of his alleged interest in the partnership property, which he claims to have been wrongfully converted to their use by other members of the firm, and for money he claimed he had advanced for the benefit of the firm. An issue was made as to whether plaintiff was a member of the firm, and also on the question of the firm's liability to him for the money claimed to have been advanced, etc. The  [**2] lower court stated its conclusion on the question as to whether the plaintiff was a partner in the following language: "As to  [*1008]  such of the public as had no notice to the contrary, the firm of Pearl, Thompson & Co. consisted of W. H. Thompson, J. M. Thompson, and Jasper Pearl; but, as between the said three parties, the firm consisted of J. M. Thompson alone. There is positive evidence in the record to support this conclusion and it is in harmony with the conduct of the parties and with many circumstances proven, while there is little evidence, if any, that militates against this conclusion." We concur in this finding of the facts. None of the persons claiming to be partners, other than J. M. Thompson, show that they contributed anything to create the capital upon, which the business was conducted. Whatever of money or property was contributed to the capital of Pearl, Thompson & Co. was by J. M. Thompson. Plaintiff died pending the action, and it was revived in the name of his administratrix. The court found that she was entitled to recover from J. M. Thompson $1,082.41. To find this amount, the court allowed $225 for services supposed to have been performed by the decedent for the  [**3] firm; $248.41 which he paid the Diamond Coal Company for the firm; $609 on account of other payments which it is claimed were made by him for the firm. The plaintiff did not seek to recover the $225 for alleged services. Therefore the court erred in allowing that amount. It appears from the evidence that the decedent paid the Diamond Coal Company $248.41 for the firm. We are of the opinion that the court erred in allowing this amount. It appears that the firm owed a note of $250 to a bank at Lancaster, which it failed to pay. The decedent entered into a contract by which he was to apply certain moneys to the payment of this note, which he was to collect on account of one Crooke's liability to the firm of Pearl, Thompson & Co. He never paid the note, but the credit was passed to his individual account on the books of the Diamond Coal Company for $248.83,—a few more cents than it is claimed the decedent paid the Diamond Coal Company for the firm. The decedent at that time was engaged in some business with Crooke. This record fails to show that decedent ever accounted in any other way for the money which he collected for Pearl, Thompson & Co. on Crooke's orders. It is fair to presume,  [**4] under the facts of this case, that the credit which was passed to him on the books of the Diamond Coal Company was on account of that contract. Excluding these items from the judgment of the court, it would leave the remaining item of $609. It is claimed that the conversion of the property took place about January, 1895. A controversy arose between W. H. Thompson and J. M. Thompson as to whether or not W. H. Thompson was one of the copartners, and that question was submitted to arbitration. The arbitrators heard the evidence, and made an award in writing to the effect that W. H. Thompson was a partner. After this was done it was suggested that the parties should arbitrate as to what interest the decedent had in the partnership assets. Thereupon that question was submitted in writing to the same arbitrators, and they found (two of whom made the award in writing) that his interest in the partnership assets was $400. The proof is that they accepted and agreed to the awards. After this was done, J. M. Thompson tendered his notes to the decedent for the amount of the award, and in some way they disagreed as to the matter, and the notes were not accepted. It appears, also, that at the time  [**5] of this last arbitration it was agreed between the parties that, if the decedent owed the firm on account, it was to be credited on the amount of the award, and, if the firm owed him anything on account in addition to the amount of the award, it was to be paid. The evidence shows that when the decedent refused to accept the notes the papers, including the notes, were turned over to Mr. Coleman, one of the arbitrators, to be held by him. Afterwards the decedent obtained them from Coleman, including the notes, but he never returned them. The court made, as a basis of its judgment, a certain statement, which it is claimed, shows an admission of the liability by appellant to the decedent of the amounts allowed. It is also claimed that this statement was before the arbitrators upon the hearing of the question submitted to them. Each one of the items allowed by the court should have been considered by the arbitrators in fixing the interest of the decedent in the partnership assets. Neither of these items could have been matters of account which were left for future adjustment. We must presume the claims allowed by the court were considered by the arbitrators in ascertaining and fixing the  [**6] value of the decedent's interest in the firm's assets. The testimony clearly shows that the matters were submitted to the arbitrators in writing; that they made their award in writing; that the parties accepted the award. They are bound by it. As the appellee failed to show that the appellant was indebted to decedent in any sum in addition to the amount of the award on any individual account, we are of the opinion that W. H. Thompson's personal representative is only entitled to recover of appellant $400, the amount of the award, and interest thereon from date of the award. The court below is directed to enter judgment against J. M. Thompson for that amount and interest.

The judgment is reversed for proceedings consistent with this opinion.

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