Best v. Pike

Winslow, J. The question whether there was a partnership between the plaintiffs and the defendant was a very important one in the case. As will be seen from the foregoing statement of facts, this question was not determined prior to the reference to Beferee Cover, nor did the order of reference expressly authorize him to determine the question, but simply empowered him to “ take an account between the parties, and report the same to the court without unnecessary delay.” Under this order, however', the referee •assumed to determine the question, and made findings thereon, and reported them to the court. These findings had ample evidence in their support, and, if they are entitled to the weight given by this court to the findings of a referee to hear, try, and determine (Briggs v. Hiles, 87 Wis. 438), the circuit court was plainly wrong in setting them aside. It becomes necessary, therefore, to determine what are the proper functions and powers of a referee appointed “ to take an account between the parties and report the same to the •court.” Compulsory statutory references are of three kinds: (1) In an action in which the examination of a long account is necessary a reference may be ordered to “ hear and decide the whole issue or any specific question of fact involved therein.” This reference is commonly called a reference to “ hear, try, and determine,” and the findings of a referee so appointed upon the issues referred to him have the effect of the ver414 diet of a jury. Briggs v. Hiles, supra. (2) There may be-a reference to take an account for the information of the-court before judgment, or to carry a judgment or order into-effect. (3) There may be a reference to report upon any question of fact, other than upon the pleadings, arising in any stage of an action. R. S. sec. 2864. The statute provides (R. S. sec. 2865) that “when the reference is to report the facts, the report shall have the effect of a special verdict.” It has beén held, and undoubtedly correctly held, that “ it is the order of the court which clothes the referee with power to act.” Stone v. Merrill, 43 Wis. 72. Therefore the powers of the referee in the present case to decide-the issues in the case must have been conferred upon him by the order of reference, or not at all. The proper construction of the order of reference is, therefore, the question first presented. It is very plain that the circuit judge did not intend to-mate an order of reference to “ hear, try, and determine ” either the whole issue or any specific part of the issue, because he refused to do so, though specifically requested to-mate such an order by the plaintiffs, and, on the contrary,, made an order to “ take an account ” between the parties- and report. Clearly this meant “ the taking of an account ” for the information of the court before judgment, under the-second subdivision of sec. 2864, R. S. It is just as clear that this did not mean the determination of the vital issues in the case upon which the rights of the parties upon the accounting depended. Regularly there should be a finding of the fact of partnership or the facts in issue upon which the> rights of the parties upon the accounting depend, before an-account is ordered. 2 Bates, Partnership, § 966. This is-the sensible and logical order of proceeding. The facts and legal questions in issue, if any, which must govern the account, should first be determined, and then the taking of the account may well be referred to a referee, and his task [415] will be largely, as the statute in that case contemplates, a. task involving accurate bookkeeping, and only incidentally involving questions of fact as to disputed items in- the account. But no objection or exception was taken to the practice as adopted in this case. The parties introduced all their evidence before the referee; and, while no additional powers were thereby conferred on the referee, but his powers must still be limited to those conferred by his order of appointment, there seems to be no good reason why the testimony which he has taken and reported, and the account-which he has stated, should not be received by the court, and why the proper findings should not be made by the court, notwithstanding the fact that the referee has attempted to make findings upon the main issues in the case, which he had no power to do. We find also from the record that the question of the powers of the referee arose at the inception of the trial, the defendant claiming that the reference was only to state an account and report the evidence, while the plaintiffs claimed that the referee should find the facts so far as was necessary to state the account. When this question arose, the referee said that he would take the testimony and refer the question of the construction of the order to the court; and the trial was proceeded with under this suggestion. Upon the coming in of the referee’s report the court evidently construed the order as practically an order of reference to take testimony and state an account, for so it is described in the findings. Our conclusion is that a referee appointed to take an account between parties under the second subdivision of sec. 2864, R. S., has no power to pass upon and determine the basic issues in the case, such as the fact of partnership. Although it may be difficult, perhaps, to state an account between the parties with such questions undetermined, still, as we have seen, the referee’s powers are limited by his [416] •order of appointment, and are not to be enlarged by implication or consent of tbe parties. This being the situation of the case, it was entirely competent for the circuit court to proceed and make findings upon the issue of partnership or no partnership in the case, and upon the other fundamental questions upon which the rights of the parties depended; and these findings will not be reversed by this court unless they appear to be contrary to the clear preponderance of the evidence. Examination of the record convinces us that the findings of the court are all sufficiently supported by the evidence, and we shall not, therefore, disturb them. The changes made by the court in the referee’s account which are important enough to justify separate notice are four in number: (1) The court found that the amount of lumber sawed and sold by the defendant was 3,484,875 feet, instead of 4,039,068 feet, as found by the referee, and that the amount received therefor was $38,279.82, instead of $44,186.43. This change is entirely justified by the evidence, which was to the effect that the figures showing 4,039,068 feet of lumber were merely an estimate made at the trimmer, while there was much evidence showing that the shrinkage between •such an estimate and the actual measurement as the lumber is disposed of is always large, and runs from eight to twenty per cent. It was this shrinkage which the court allowed for in this item. (2) The referee credited the plaintiffs on the accounting with one half the value of 3,000 cords of slabs and 400,000 feet of mill culls or “ scoots ” which came from the lumber manufactured, and were retained by the defendant at his mill, and never accounted for. This item was entirely disallowed by the court. The reason of the disallowance was this: The evidence was overwhelming to the effect that when the lumber in question was manufactured there was a [417] universal custom among the-mills and lumbermen in that vicinity to tbe effect that the slabs and culls made from lumber belonged to the mill, it not being considered that they were of sufficient value to more than pay for their removal. This being the case, and the parties not being partners, the disallowance was plainly justified. (3) The court found that Best Bros, delivered only 991,322 feet of their own logs to the defendant’s mill, instead of 1,299,550 feet, as found by the referee. This finding is based on ample evidence showing that, although Best Bros, had 1,299,550 feet of logs cut from their own lands, they sold and delivered over 300,000 feet to third parties, and received the money therefor. (4) The court disallowed a part of the plaintiffs’ account for rafting logs, and a part of the plaintiffs’ private account. It is sufficient to say as to these changes that they seem to have been entirely justified by the evidence. "We think substantial justice has been done between the parties, and have discovered no errors calling for reversal. By the Court.— Judgment affirmed.