Hamilton v. Johnson , 137 Wash. 92 ( 1925 )

This suit was instituted as a suit for the partition of real property. It is alleged in the complaint that the respondent, Hamilton, as a community, and the appellant Johnson, a widow, are the owners, as tenants in common, of the property sought to be partitioned; the community, on the one part, and Johnson, on the other, each owning an undivided half thereof. It was further alleged that the property is so situated that partition in kind cannot be made without great prejudice to the respective owners. The prayer of the complaint is in the alternative. It is asked, first, that the property be divided according to the respective rights of the parties, if the court finds that it can be so divided without prejudice to their respective rights; or, if the court does not so find, that the property be sold and the proceeds of the sale be so divided.

The appellant Johnson, answering the complaint, admitted that she, together with the respondent, owned the described property in fee, but denied that they owned it as tenants in common. By a separate answer and cross-complaint, she alleged that they owned the property, with other property, as copartners, that no accounting of the partnership had been had, and that no partition or division of the partnership property could be made, or their respective rights therein determined, until such an accounting was had. The prayer of her answer is that an accounting be had, and that the court render such a decree in the cause as it should find meet and equitable upon the accounting.

After issue had been joined, the appellant Johnson Hamilton, a corporation, was allowed to file a complaint in intervention. In its complaint, it alleged that it had a leasehold interest in the property. The prayer of its complaint was also for general equitable relief.

Issue was joined on the affirmative matters set forth in the answer of Mrs. Johnson, and the allegation of the intervener's complaint, which the lower court, after a trial, determined. As between the respondents and the appellant Johnson, it found that they owned the property as tenants in common, and not as copartners; found that the respondents were entitled to a partition thereof; found that the property could not be partitioned between the parties in kind, without great prejudice to the respective owners; and found that the appellant was not entitled to relief under her cross-complaint. As between the respondents and the intervener, it found that the intervener had not "established its right to any relief whatever under the allegations of its complaint."

In its decree, entered pursuant to its findings, the court dismissed both the cross-complaint and the complaint in intervention; ordered that the real property be sold, on terms and conditions which it prescribed in its order; and appointed a referee for the purpose of making the sale; vested the referee with authority to execute the order, and provided that he should make due return to the court as to the manner in which he executed his trust. Both Mrs. Johnson and the intervener appeal from the decree.

[1] The appellants assign error on the refusal of the court to sustain their challenge to the sufficiency of the complaint. This question was raised for the first time after issue had been joined, and after the cause had been called for trial by an objection to the introduction of evidence. The objection came too late. The code provides (Rem. Comp. Stat., § 263) that, if no objection to the complaint be taken, either by demurrer or answer,

". . . the defendant shall be deemed to have waived the same, excepting always the objection that the court has no jurisdiction, or that the complaint does not state facts sufficient to constitute a cause of action, which objection can be raised at any stage of the proceedings, either in the superior or supreme court."

This statute has been upon the statute books substantially in its present form since the first session of the territorial legislature of 1854. See Laws of 1854, p. 139. The first of these objections, that the court has no jurisdiction, is still in full force and effect, but it neither adds to nor restricts the powers of the court. A judgment entered without jurisdiction is a nullity, and no court, whether it be the court of original or of appellate jurisdiction, will continue an action or proceeding where it is made to appear to it that it is without jurisdiction.

The second of the provisions has been much modified and limited by subsequent statutes. Those most pertinent of these are the statutes relating to amendments of pleadings. Now a party may amend his pleadings, when attacked in the superior court, almost as a matter of course; and this court, in considering an appealed cause, is admonished to disregard all technicalities, and "consider all amendments which could have been made as made." It is, of course, at once apparent that, if the provision of the statute under consideration is to be given its apparent literal meaning — if, in other words, a complaint may be searched for any sort of defect at any stage of the proceedings — the benefit of the provision of these amendatory statutes will, in many instances, be denied the litigant. It is undoubtedly still the rule that, if the complaint shows upon its face that the plaintiff has no cause of action and under no circumstances can have a cause of action, the court will stay the action at the earliest time the matter is brought to its attention. But technical defects, or defects that can be cured by amendment, can avail the objector only in the case he raises the objection either by motion or demurrer before he enters upon the trial. These rules have been repeatedly announced by this court. InBonne v. Security Savings Society, 35 Wn. 696, 78 P. 38, we said:

"The complaint consisted of three causes of action, each of which was separately stated. To it the appellant took issue by answer, both by denying its affirmative allegations, and pleading new matter in defense thereto. At the trial, when the respondents commenced the introduction of evidence, it, for the first time, made the objection. This, as we have repeatedly held, was too late to take advantage of any technical defect in the complaint; there must be a defect in substance, incapable of being cured by amendment, before courts will hold the complaint bad, when the objection to it is raised on the trial for the first time. The objections urged by the appellant against the sufficiency of the complaint before us are not matters of substance. At most they are but technical defects and omissions which can be cured by amendment, and will now, inasmuch as they were not suggested in time, be deemed corrected by amendment."

In O'Day v. Ambaum, 47 Wn. 684, 92 P. 421, 15 L.R.A. (N.S.) 484, we said:

"Bal. Code, § 4911 (P.C. § 378), provides that the objection that the complaint does not state facts sufficient to constitute a cause of action can be made at any stage of the proceedings. This court, however, has held that a defendant's failure to interpose a demurrer to a complaint, followed by an objection to its sufficiency made for the first time at the trial, will cause the court, in passing upon such objection, to bring to the support of the complaint every reasonable intendment and legitimate inference that may be drawn from its allegations, and also from the evidence adduced to sustain the plaintiffs' cause. If, on an application of this test, it appears that the defect in the plaintiffs' complaint and cause of action is one of substance which cannot be cured by amendment or evidence, then it is the duty of a trial court to sustain the objection and dismiss the action."

To the same effect are Kelly v. Lum, 75 Wn. 135,134 P. 819, 49 L.R.A. (N.S.) 1151, and Yeisley v. Smith, 82 Wn. 693,144 P. 918.

In this instance the complaint was not as full in statement as good pleading required, and was subject to a motion to make it more definite and certain, and possibly to a general demurrer. But there was in it the substance of a good cause of action, and its defects were capable of cure by amendment. Under the rule of the cases cited, however, the defendant waived its right to complain of the defects by answering over and intervening upon the trial.

[2] There was, moreover, no prejudice shown. The action was tried as if upon a sufficient complaint, in which trial the defendant was given every opportunity to present her defense. The rule of the statute requiring this court to consider all amendments which could have been made as made, is, therefore, applicable.

To an understanding of the contention that the property sought to be partitioned is property owned in partnership, rather than as tenants in common, requires a further statement of the facts. It appears that, for a number of years prior to August 20, 1920, the respondent Hamilton and the husband of the appellant were partners, doing an undertaking business, under the name of Johnson Hamilton. The business, for the later years the partnership continued at least, was conducted on the property here in question under a lease from its owner. The business had been prosperous. At the time the partnership was dissolved by the death of Johnson, it owned the equipment in the leased business, had a number of outstanding accounts, had some six thousand dollars cash on hand, and owed no debts. Johnson died on the date given, and shortly thereafter the appellant Johnson was appointed administratrix of the partnership estate. There were heirs to the estate of Johnson other than the appellant, but these, shortly after her appointment as administratrix, conveyed their interests to the appellant.

After the death of Johnson, the business was continued under the old partnership name, the respondent Hamilton assuming the principal management, although the appellant assisted at such times as her assistance was found necessary. There was no agreement between the parties as to the conduct of the business after the death of Johnson, but it is inferable from the evidence that they conducted it as the business of the partnership estate. The business was continued in this manner until the end of the year 1922, when a corporation was formed by Mr. Hamilton and Mrs. Johnson to take over the business. To this corporation, Mrs. Johnson conveyed all of the partnership estate, except the uncollected accounts, each of the incorporators taking an equal number of shares of the corporation's capital stock. The record does not show directly whether all of the shares were thus divided or not, but it is inferable from subsequent matters shown that there were a few shares taken by a third person. On the formation of the corporation, Mr. Hamilton was elected president and manager, and commencing with January 1, 1923, the business was conducted by and in the name of the corporation.

The real property here in question was the property on which the business was conducted, and was purchased on August 1, 1923. The deed thereto was taken in the name of Sophia Johnson and Frank Hamilton, the individual appellant and the respondent in this action. The consideration for the conveyance was the assumption of a mortgage on the premises by the purchasers in the sum of $10,500, and a cash payment of $9,500. The cash was paid from the assets of the corporation, one half of the purchase price being charged on the books of the corporation to each of the parties as money withdrawn by them respectively.

[3] The argument is that the legal relation of the individual appellant and the respondent between the time of the death of appellant's husband was that of a partnership; that this partnership survived the formation of the corporation, rendering their interests therein partnership property; and that, since the land was purchased with assets taken from corporation funds, it is also partnership property, and is not subject to partition under the statutes authorizing the partition of property held by tenancy in common.

But we have difficulty in following the argument. If it were necessary to define the legal relationship existing between the parties prior to the formation of the corporation, we would rather conclude that it was in the nature of employer and employee than that of partnership; that is to say, the business was the business of the partnership estate, conducted by the appellant as administratrix thereof, of which the respondent acted as manager. [4] But whatever the legal relationship of the parties may have been prior to the formation of the corporation, it was changed by that transaction. Subject to possible debts and the expenses of administration, each of the parties was entitled to a distribution of one half of the estate. The estate was then divided; irregularly, it may be, because not with the authority of the probate court, but validly, nevertheless, as between the parties. Thereafter they stood with relation to their property as all stockholders in a corporation stand. The money they withdrew from the assets of the corporation was, as between themselves, their individual money, and when they invested it in the real property involved, they invested it as individuals; and, in the absence of an agreement to hold it in some different capacity, they became tenants in common of the property.

[5] It is argued that the plaintiff has shown no right to a partition. We think otherwise. He has shown ownership as a tenant in common with the defendant. The right of partition by a tenant in common of real property is absolute, in the absence of an agreement to hold the property in such a tenancy for a definite and fixed time. Inconvenience of the other owners, or a depreciation in value of the interests by a partition, is not a defense.

[6] The appellant corporation contends that it has a term lease on the property, and that its rights were not protected by the order of partition. But we do not find that the evidence justifies the contention. It had, it is true, a five-year lease on the property, executed by the appellant Johnson, on her own behalf and on behalf of the respondent Hamilton. The lease was evidently executed on the assumption that the property was partnership property, and that she could, as one of the partners, make a binding lease on behalf of the other. But in this assumption she was mistaken. Her act, however much it may be binding upon her own interests, did not bind her co-tenant. As to him, the lease conferred no rights in the corporation to the property which will prevent partition between the owners, and the court did not err in refusing to recognize the lease.

The decree is affirmed.

TOLMAN, C.J., HOLCOMB, ASKREN, and MACKINTOSH, JJ., concur.