Etowah Mining Co. v. Christopher , 112 Ala. 554 ( 1896 )

HEAD, J.

The appellee, as receiver of the O’Connor Mining & Manufacturing Company, brought this suit, at law, to recover of appellants a sum of money alleged to be due by account. The defendants pleaded that the amounts claimed involved the settlement of a partnership existing between plaintiff and defendants, in the course of which the debts sued for were incurred, and the amounts due the respective partners cannot be known without the settlement of the partnership existing between plaintiff and defendants, and that said partnership, which existed at the time the debts sued for were created, has never been settled.

To this plea the plaintiff demurred, as follows : “1st. The plea attempted to plead a partnership as a bar. to this suit between plaintiff and defendants which cannot be done, as the plaintiff sues as receiver of the chancery court, and the recovery must be to plaintiff as such receiver, ' and the plaintiff as receiver could not enter into partnership with defendants.” The court sustained the demurrer, and on trial of other issues of fact, sitting without a jury, rendered judgment final for the plaintiff for a sum of money specified, and this ruling is assigned as error.

It is, of course, not disputed that, as a general rule, demands of partners against each other, growing out of the parnership business, cannot be the subject of a suit at law by either against the other, until there has been a settlement of the partnership and a balance ascertained in favor of the plaintiff. Courts of law are not regarded adequate for the settlement of such accounts, which involve not only adj ustment of the demands of the partners inter sese, but possibly those of joint and separate creditors of the partnership and partners ; and the jurisdiction has been accorded exclusively to equity. But appellee insists that if a person filling the office of a receiver in chancery, steps aside from the duty of his position and wrongfully enters into a parnership. with another, he may carr’y on the business contemplated by the relation and bring about the complications which render law inadequate and necessitate equitable interposition to justly settle the accounts, yet, because of his own wrong in entering into the partnership, he may .subject his co-partner to the injustice of an impracticable and possibly disastrous effort to settle the accounts in a court of law. It is not open to a person to lay claim to such a privilege. He will not be heard to say that, as receiver, he had no authority to enter into the partnership. So long as he is the party complaining, his official character and disabilities will be put out of view. The chancery court — the source of his official authority —is competent to protect the receivership. If by his misdoing the trust is endangered, he is responsible to the court appointing him for the consequences, and ample remedies may be found against any who may have wrongfully participated with him, in any misappropriation of trust assets. But, we repeat, it is not for him to allege his own delinquency to the injury of another with whom he has dealt, and, while claiming the benefits, repudiate the burdens of his transactions.

The court erred in sustaining the demurrrer to the plea.

There is no merit in the motion to dismiss the appeal. Though, by the act creating the court, an apppeal might have been taken from the interlocutory order, within thirty days, the failure to do so does not-deprive the party of the right to assign the order as error, on appeal from the final judgment, prosecuted within twelve months, under the general statute. Nor was an exception necessary to bring- before us for revision the ruling on the demurrer.

Reversed and remanded.