Moore v. Hubbard , 4 Ala. 187 ( 1842 )

ORMOND, J.

The object of this bill is to have an account of the transactions of a partnership for the purchase and sale of Indian reservations in the Creek Nation, formed between the complainant and certain persons styled his associates of the first part, W. H. Moore of the second and Jesse Duren of the third pai;t, the terms of which partnership were reduced to writing. The money for the purchase of the lands was to be furnished by the complainant and his associates, and Moore, the land to be purchased by Duren, and the profits which might arise from a re-sale, after refunding the money advanced, to be divided in three equal parts between complainant and his associates, Moore and Duren.

The complainant alledges in his bill that he has become the owner of the entire interest of himself and his associates, by a purchase from them, and they are made defendants to the bill. Moore and Duren in answer to this allegation of the bill, say they have no knowledge of the fact, and call for proof. Two of the former partners of the complainant answer the bill, and admit that they have sold and transferred their interest in the partnership to him. The other two are non-residents, against whom publication was made, and decrees pro confesso taken.

His Honor the Chancellor held these admissions proof of the fact that the complainant had acquired the entire interest of himself and his former partners. He considered that it was a mere disclaimer of their interest, and that as they were parties to th.e bill, the decree would operate as an estoppel.

As it is shown by the bill that four other persons were originally equally concerned with the complainant in the money sought to be recovered by the bill, they should have been joined with him in the suit as complainants, to obviate which it is alledged in the bill that the complainant had by purchase from them acquired their entire interest. As this fact was denied by the answer of the two defendants, who are sought to be charged by the bill, it was incumbent on the complainant to prove it. This he attempts to do by the admissions of his former partners, who were made defendants.

It is well established as the general rule in Chancery, that the answer of one defendant cannot be read in evidence against a co-defendant. The exception is where there is an identity of interest, as where all the defendants are partners in the same transaction, [Clark’s adm’r v. Van Riemsdyk, 9th Cranch, 153,] or where the defendant whose answer is read, and the defendant sought to be charged, are privies in estate. [Osborne v. The Bank of the United States, 9th Wheaton, 738; Gresly Eq. Ev. 322.] Other exceptions may exist to the rule, but these are sufficient to show the reason of the rule itself. In this case none of the reasons exist which would authorize these defendants to charge Moore and Duren by an admission.

The Chancellor does not appear to have considered the evidence afforded by the answers thus offered against Moore and Duren as establishing facts as evidence against them, but as mere proof of a disclaimer of interest, on the part of these defendants, in favor of the complainant. It is true that such is their effect as between them and the complainant,but they are used for another purpose; they are the only evidence of the right of the complainant to sue irx his own name, which, as his right thus to institute the suit was controverted by those defendants whom he sought to charge, it was incumbent on him to prove. It is therefore the plain case of the answer of one defendant read as evidence against a co-defendant, as between whom there is neither privity of estate nor community of interest, and viewed in this light the answers were clearly inadmissible as evidence against the other defendants.

Nor indeed could the answers operate against the other defendants even as evidence of a disclaimer of interest, as is shown by the case of Hill v. Adams, 2 Atkins, 39.

In all other respects the decree of the Chancellor appears to be correct. The position assumed by the counsel for the defendants in error, that the fifteen hundred dollars mentioned in the articles of agreement entered into between the parties, was a loan to Duren individually, and not a part of the capital stock to be invested in the purchase of lands, has no foundation. It is impossible to doubt, taking the whole agreement into consideration, that this money was advanced for the purposes contemplated by the articles of agreement, and was not intended as a mere gratification to Duren.

The objection to the allowance of interest is put upon the ground that there was no reference by the Chancellor to the Master for that purpose. '

It is true, the Chancellor does not in express terms direct the Master to compute the interest on moneys in the hands of the defendants. He did however require the Master to ascertain and furnish the data by which it was to be ascertained, “ and to state the accounts between the parties in a tabular form, so as to present the final results.” The right to recover interest where money is improperly withheld, is, in a Court of Equity, as clear as the right to recover the principal. The accounts therefore, could not be stated between the parties without a computation of the interest, and this was the appropriate duty of the Master.

The objection that the bill is multifarious, is not sustained by the record. If the tract, of land said to be purchased from the Indian, Fixit Hadjo was, as is supposed, charged in the bill to have been purchased for the benefit of the complainant and his associates, and that the other two partners, Moore and Du-ren had no interest in it, the bill would certainly be liable to the objection made, as it would be the union in the same bill of two distinct and separate interests, but such is not the fact as shown by the bill itself, as it is expressly charged that the money to purchase this tract of land was furnished to Duren, by complainant, under the agreement to purchase lands for the common benefit of the partnership.

The final decree of the Chancellor confirming the report of the Master and awarding excution for the amount ascertained is sufficiently certain.

It results from these views that the decree of the Chancellor must be reversed and the cause remanded, that the complainant may establish his right to sue in his own name.