Conger v. Cotton

OPINION. Eakin, J. i. oh anpiiACTicis: "yy li Q JX there is jnrisdicti o li matte? an The bill, considered simply as a suit to recover a balance due complainant for money advanced for lumber, and for money had and received by defendant to the use of ^ comPlainant, did not present such a case of mutual accounts, to require the interposition of a Court of Equity. The relief, as to that much, might have been effectually rendered at law. But the'bill further seeks to have complainant’s note delivered up and cancelled and to have an outstanding mortgage declared satisfied. This was the peculiar province of a Court of Equity, and draws to it all legal relief connected with the subject matter. The well settled rule is, that where, by reason of any equitable element, a Court of Chancery acquires jurisdiction of a matter in controversy, it will retain it for the settlement of all rights between the parties, growing out of and connected with the subject matter, whether legal or equitable, 'so as to do complete justice, and may even adjudge damages for compensation, which it •could not do, if they were the principal object of the suit. 2, demuksuit1bro-31 s j¡.0:ram: equitlbie cross-bill If it were true that the action should have been brought at law, the objection should not have been made by demurrer, but by motion to correct the error made at the time of filing the answer. Gantt’s Digest, Sec. 4464. This, defendant3. could not have done, because he made his answer a cross bill, setting up equitable grounds for relief, and which quired the cause to be retained on the equity docket. This cause was, therefore, properly heard and determined in equity. 7. Piuc-TICE: Amenaing cerciücateto aepositio n s. There was no error in allowing the notary, who took the J deposition, to amend his certificate in accordance with the facts. Whatever may be the case with regard, to the J ° proof and acknowledgment of deeds, where rights of third parties may be affected, there is no more reasoii for refusing to allow a commissioner to amend his certificate of the taking of depositions than there would be for refusing to allow a sheriff to amend a return. A sheriff not only may do that, but may be compelled to do it. As amended, it showed that the depositions had been taken at the time and place stated in the notice, and that the witnesses were duly sworn. It was not necessary to repeat the form and substance of the oath administered. In all material matters, the certificate corresponds with the directions of Gantt’s Digest, Sec. 2580. The motion to suppress the depositions was properly overruled. s. same: dSstímony of a party. The proof was all upon the part of complainant and fully sustains all the allegations of the bill. It is not only unim0 peached, but impresses the mmd with its truth in the absence ■of all effort on the part of the defendant, either by cross examination or by counter testimony, to destroy its force or explain it. He does not himself offer his own evidence to sustain the denials of his answer. His counsel contends here-that the exact amounts of the account are only proven by the testimony of the complainant, and that the answer, being responsive to the allegations of the bill, should overbear the testimony of one witness, without strong corroborating circumstances. It requires no citatiou of authorities to show that such was the old rule in equity. But, save as to amounts,, there was in this case very strong corroboration by other witnesses — quite sufficient under the rule, if it were applicable under the code. But it is not. The system has been changed. Formerly the complainant, without any oath of his own (save in exceptional cases provided by Statute),, drew the defendant before the chancellor to probe his conscience. Pie made his adversary his own witness, and being allowed to do so, contrary to the course of common law, he-was held bound by the answer unless he could disprove it. by still stronger countervailing evidence. This was reasonable. The new system proceeds on different principles. All parties are allowed to testify, and bills of discovery are almost wholly abolished. They are no longer necessary where either party may testify for himself, and make Iris-ad versary a witness. All pleadings are required to be verified on both sides. The probing of conscience has been applied to both with equal severity before issues are made. The pleadings only make the issue, leaving the preponderance of testimony only necessary for him who has the onus-of showing the fact from which the equity arises. His own-testimony taken subject to all the tests of cross examination is a different thing from sworn allegations in pleading. It-is of a higher -nature, being more deliberate, cautious and plain, besides being in his own language, without the forms of pleading. It is enough when unimpeached and credible, to sustain a decree, in the absence of evidence on the other side. In short, the rule urged upon the court, has in the Code States, passed out of equity practice, and belongs only ■ to the history of Equity Judicature. (See Gantt’s Digest, Section 4591). The matters in controvesy grew out of the old partnership transactions of T. C. Conger & Co., of which firm complainant, defendant, and two other persons, to-wit: Jacob Conger and Claiborne Cotton, were the component members. Claiborne Cotton’s interest appears, both from the bill and his own deposition, to have passed to the complainant ; but no notice whatever, in the suit, is taken of the interest of Jacob Conger. The defendant did not, in any pi’oper way, ask that he be made a party, or object to proceeding without him. The question still arises, whether the court should have proceeded in his absence. The test of the duty of the Chancellor, in such cases, is found in section 4481 of Gantt’s Digest, which provides that: “The court may determine any controversy between parties before it, when it can be done without prejudice to the rights of others, or by saving their rights. But, when a determination of the controversy between the parties before the court cannot be made, without the presence of other parties, the court must order them to be brought in.” The meaning of this is plain; and, in most cases, easy of application. A Chancellor should not allow his own time, and that of the court, to be consumed in doing a vain thing, which may be unsettled by the subsequent assertion of equities on the part of others not bound by the decree. Whenever it is apparent, from the pleadings, or seems probable, that there are other parties interested in the subject matter, whose rights, when asserted, might make a decree as to the parties before it, different from that which might appear proper in a controversy between themselves alone, then a court should not proceed until all parties interested are present, that the ultimate rights, on final result, of the parties before it, as to each other, .may be permanently determined. But if it appears that the assertion of other equities in the subject matter, by third parties, could not alter the liability of the parties before the court, as between themselves, then, although such third parties may be properly brought in, they are not absolutely necessary. This is such a case. It is not a bill to wind up and settle a partnership, and marshal the assets, and appropriate them in due order, first to have payment of debts, next to the adjustment of equities between the partners, and then for partition of the l'emainder. That would have required all the partners to be present, in order to determine how much either one of them should pay the other. But here, it seems, that, by agreement, the old partnership was closed in 1872, and there are no outstanding debts of estimable importance. It'appears that complainant is entitled to one-half of the old assets, and defendant and Jacob Conger each to one-fourth. If the defendant is held liable to complainant for one-half of the debts to the firm, which he collected or used, and for one-fourth of the old debts of the firm, which complainant paid, that does not touch the rights of Jacob Conger in any way, and the amount due complainant, from defendant, cannot be altered by any assertion hereafter of Jacob Conger’s right against either, nor by the assertion of complainant’s rights against him for one-fourth of the debts paid. There is no distribution in this case of assets on hand. What remains is a personal matter between Jacob and each of the others, which may be independantly settled, without disturbing this decree. Certainly it would have been better, and more consonant with the general purpose of Chancery, to close all litigation in one suit, if the Chancellor had directed Jacob Conger to be brought in, that he might disclaim or assert his rights, but it was not imperative. The court might, and did, determine the controversy between parties before it, without prejudice to the rights of Jacob Conger. statute The appellant contends that his agreement to account to complainant for a proportional part of the accounts, which he took and assumed, was within the Statute of frauds, and was not in writing. This position is not tenable. If, on a ■close of partnership affairs, one partner is allowed to take, for his own use, a part of the assets, whether choses in action, or anything else, on -an agreement with his copartners to account to them for a definite share, it is a separate and direct agreement, on a new consideration. It becomes to the other partners, then, a matter of indifference, whether the debts are collected or not. They belong to the partner •taking them, and he may collect them, or use them in trade, or to satisfy his own individual debts; or he may release them wholly. It amounts to nothing more nor less than a purchase of the interest of others in property belonging to them jointly. The Statute of frauds has no application. The decree is in excess of the amount proved, but in all ■other respects, clearly just and equitable. The excess was probably the result of an error in calculation, or of a clerical error in the entry. However that may be, it is, nevertheless, an error which sustains the appeal, at least to the extent of carrying the costs of this court against appellee, and for the correction of excess. Enter a decree here for the amount of $329.05, in favor of the complainant below, with interest at 6 per cent, from •the second day of July, 1872. Let the appellee be ordered to pay the costs of the appéal, and remand the cause to the -court below for execution.