Beck v. Thompson

The facts are stated in the opinion. The material facts and the several transactions involved in this case were reviewed on the former appeal by this court, and are set forth in the case of Beck v. Thompson,22 Nev. 109, and need not be repeated here, except in part in considering the questions raised on this appeal. The second trial resulted in a judgment in favor of the plaintiff for the sum of $4,424 64, with certain interest. From this judgment and the order of the court denying his motion for new trial, the defendant appeals. The law of the case was settled on the former hearing by this court, and the basis upon which the second trial should be had was pointed out.

One of the grounds specified in the notice of motion for new trial is "insufficiency of the evidence to justify the decision and judgment," and is one of the assignments of error. Counsel for appellant claim that sums of money were not credited to Lake, Thompson's predecessor in interest, which he should have been credited with, and that erroneous charges for wages were allowed.

1. Our attention is called to the $30,000 transaction, including the promissory note executed by the firm of Lake Beck to Lake. At a certain date Lake had advanced to the firm of Lake Beck $30,000 more than Beck, which were used in carrying on the business of the concern, and in acquiring property for the firm. Lake being desirous of drawing out a part of his advances, the firm borrowed $20,000 of Paxton, for which a promissory note was executed by and in the firm's name to Paxton, and a mortgage given on the property of the firm. This note and mortgage were subsequently paid out of money belonging to the firm of Lake Beck. Lake received to his individual use the $20,000 borrowed. There still remained in the concern $10,000 of Lake's advances. For this sum, and to adjust the capital account between M. C. Lake and H. H. Beck, Lake received the promissory note of the firm of Lake Beck. This note was paid out of the firm's money. It is strenuously contended by counsel that Lake was a creditor to the amount of $30,000, and, like any other creditor, should have received the $30,000 advanced; that the $20,000 borrowed from Paxton and the $10,000 note given to Lake having been paid out of partnership funds, one-half of which belonged to Lake, the two transactions resulted in Lake receiving only $15,000 of the $30,000 advanced; and that, to correct this error, Thompson, who succeeded to Lake's interest, should be credited with $15,000. The fallacy of this contention is apparent. When one of two partners advances a sum of money to the partnership concern, and the sum is paid back to him out of the moneys of the firm, the debt is canceled, and he has no further claim against the partnership or against his partner with respect to the matter; and we know of no rule of law governing transactions between partners, and no rule in common arithmetic or in common philosophy, that would give a different result.

2. Counsel claim that the evidence does not sustain the conclusions of the court as to the rent of the mill property; that Lake Beck should have been credited with $400 per month from the 1st day of May, 1881, the date H. H. Beck Co. entered under the lease. In this we think counsel are mistaken. We find from the record that Bole paid Lake as rent $100 per month from May 1 to October 10, 1881, when the mill was destroyed by fire. On June 1, 1892, Lake Beck received a credit, for rent, the sum of $1,466 66, and from that date, including June, they received a credit of $400 per month. It appears from the entries in the company's books that no rent was charged by Lake it Beck to H. H. Beck it Co. for the period between the date of the destruction of the mill, October 10, 1881, and the date of the completion of the new mill, in March or April, 1882. We therefore find no error in the rent account as settled by the court.

3. Appellant's counsel object to the allowance of the sum of $1,000 to Beck for services rendered to Lake Beck from February 14, 1885, the date Beck, as surviving partner, rendered his account to the administrator of Lake's estate, up to the 8th of October, 1888, the date of the distribution of the estate, when Thompson succeeded to the interest of the estate in the concern of Lake Beck and of H. H. Beck Co. They object, on the ground that Beck rendered no services to Lake Beck of material value. The evidence fully establishes the value of the services in a sum greater than the court allowed; but on the former appeal this court held that Beck was entitled to no compensation for such services after the formation of the partnership of H. H. Beck Co. In this respect the judgment is erroneous. From the formation of the firm of Lake Beck up to the organization of H. H. Beck and Co., Beck received $100 per month salary, as manager of the business of the concern, by agreement of the parties. After the firm of H. H. Beck Co. was organized, he received the same monthly salary as its managing agent, up to the dissolution of the co-partnership; and Bole, as bookkeeper of the concern, received a monthly salary of $100 up to the time he withdrew from the firm. The work in conducting the business of the new firm was partly divided between Beck and Bole. After Thompson became a member of the firm, he took considerable part in carrying on the business. It seems to us, as was said when this case was here before, "that, after the formation of the firm of H. H. Beck Co., the old firm of Lake Beck ceased to exist, and consequently we have but the affairs of one partnership to settle. After that, Lake Beck were simply tenants in common of the mill property, for the use of which they were to receive a certain compensation over and above the profits of the business (of H. H. Beck Co.), the same as Beck and Bole were to receive extra compensation for their services; and the firm name of Lake Beck was simply used by the bookkeepers of the former firm for convenience of keeping the accounts of the mill." The trial court allowed $1,000 in gross for services rendered to Lake Beck, including the Arcadome transaction. We take it that the court considered the value of the services rendered in and about the Arcadome business as being but a small portion of the sum allowed for services.

Under all the facts and circumstances of this case, and in the absence of any express or implied agreement appearing to the contrary, we are of opinion that Beck is not entitled to compensation for services rendered to Lake Beck after May 1, 1881, when the new firm, H. H. Beck Co., entered into business, and that the judgment should be corrected accordingly. From Beck's credit of $7,908 74, the district court will deduct the sum of $4,247 10, in place of $3,247 10. With this correction, and the necessary corresponding corrections in the decision, findings, and judgment to be made by the court below, the judgment is affirmed. Each party will pay his own costs on this appeal.