Miller v. Kemper

Mackintosh, J. The respondent and appellant and George B. Branch entered into a partnership agreement looking towards the operation of a farm owned by them, the agreement providing, among other things, that: “. , . during the absence of said Kemper the other partners may expend such amounts as may be necessary to the upkeep or improvement of the place, notifying said Kemper of such expenditures. If they pay out their own private funds they are to be allowed six per cent interest on such amounts expended until reimbursed, but under no circumstances are they, or either of them, to buy goods on credit, or in any way obligate the ranch for supplies to an amount over $250, unless the funds are on hand to pay such obligations, either of their own or the company’s funds.” *275 The complaint, after calling attention to this agreement, states that the partnership is still continuing, not having been dissolved, and that the respondent “has advanced to the said partnership and for its use and benefit in the upkeep and improvement of the farm property, a total sum of $14,171.03”; it is then alleged that the three partners have contributed the sum of $36,008.75, and that each partner’s contribution should be one-third of that sum, and that the respondent, by reason of his advancement, has contributed more than his share, and that the sum of $399.91 “-represents the contribution to the partnership capital made by the respondent to the benefit individually of the appellant.” To this complaint the appellant demurred, and the demurrer being overruled, and he standing upon it, judgment was entered in accordance with the prayer of the complaint. The complaint attempts to interpret the portion of the partnership agreement which we have quoted, in this manner: “. . . that by the terms of the partnership agreement each partner was authorized to advance moneys for the use and benefit of the said partnership as might become necessary in the improvement or upkeep of the said farm, and when such advancement was made the partner so making the advancement was and is to be allowed six per cent interest on such advancements, the same becoming a charge against the other two partners in proportion to their interest and investment. ’ ’ Respondent concedes the rule to be that one partner cannot sue another, before dissolution of the partnership, on a claim growing out of the partnership business. The appellant asserts his right to be relieved from the operation of this rule of law by resort to the exception that one partner may sue another on an obligation which does not grow out of the partner *276 ship, although it may iu some degree relate to the partnership, the appellant claiming that the advancement was not made to the partnership, hut was an advancement to his partners as individuals. It is, of course, true that there obtains such an exception to the rule, and one partner may sue another for advancements which he has made to the other, which advancements may have been used in the pártnership business; but this exception cannot be invoked in the present case, for, as we read the contract, the advancements which are sought to be recovered here are, by the terms of the agreement, advancements made to the partnership, and constitute a loan on the part of the respondent to the partnership which cannot be collected until after an accounting has been had and primary creditors have been protected and the partnership dissolved. That portion of the complaint which seeks to charge the advancement against the appellants individually is not good against the demurrer, for the "reason that it is an interpretation which the pleader has put upon a written instrument, an interpretation contrary to our view of the agreement. The complaint, disregarding this improper interpretation, does not state facts sufficient to constitute a cause of action, and the demurrer should have been sustained. The judgment of the lower court will be reversed. Maix, Tolmax, and Fullertox, JJ., concur.