Torbe v. Strauss

The following opinion was filed November 18, 1913: IIeRwiN, ,J. The findings set out in the statement of facts give a sufficient history of the case. The main question is whether William Strauss and Oscar A. Strauss, or either of them, was liable for the $2,000 advanced by the Fred Miller Brewing Company. This questio i turns upon the construction of the contract, namely, whether the $2,000 was to be furnished by Strauss as capital stock. By the terms of the partnership agreement F. I. Wildes put in [525] $6,700 and Strauss was to put in $3,300. He pnt in $1,300’ ,in cash, the balance, $2,000, be was to put in by way of improvements, and such part of the balance, if any, not pnt in by way of improvements was to - be furnished in cash. Wildes was to have a two-thirds and Strauss a one-third interest in the business, each furnishing capital stock in that proportion. The improvements, amounting to $2,000, were put in by the defendant Ered Miller Brewing Company and were never paid for by either William, Strauss or Oscar A. Straussj so the only money put into the business as capital stock by William Strauss or Oscar A. Strauss was $1,300. The findings are well supported by the evidence, and the question is whether Strauss was to put into the firm the balance, $2,000, or whether the making of the improvements by the Ered Miller Brewing Company at the request of Strauss was a compliance with the partnership agreement. The material parts of the partnership contract are the-following: “Second. To that end and purpose the said Fred J-Wildes has contributed sixty-seven hundred dollars ($6,700)-in investment already made by him, consisting of furniture-equipment, and everything and all property of every kind and description now located at said building. Said Oscar A. Strauss is to contribute thirty-three hundred dollars* ($3,300) in all, such money to be paid in as follows: Said Oscar A. Strauss to have the option to pay in thirty-three hundred dollars ($3,300) in cash and secure the investment of two thousand dollars or any portion thereof by any other person or persons, such amount to be expended in improvements on the first floor or first floor and basement. Any amount of improvements which said Oscar A. Strauss secures from any person or persons for the benefit of this partnership to constitute a part payment of the thirty-three hundred dollars ($3,300) to be contributed by said Oscar A. Strauss. Should such improvements not be secured by said Oscar■ A• Strauss, then he is to pay the entire sum of thirty-three hundred dollars and invest the same in the partnership. If improvements for less than two-thousand dollars ($2,000); [526] are secured from other persons by Oscar A. Strauss, said Oscar A. Strauss is then to invest enough money to make up the difference between the amount put in in improvements by other persons for said partnership and the total sum of thirty-three hundred dollars. “The respective interests of said partners in said partnership business to be: said Fred J. Wildes is the owner of two thirds thereof and said Oscar A. Strauss the owner of one third. After all expenses are paid, net profits are to be shared, two thirds to said Ered J. Wildes and one third to said Oscar A. Strauss. Any net loss that occurs is to be borne in the same proportion, two thirds by said Ered J. Wildes and one third by said Oscar A. Strauss We think it clear from the foregoing contract that Strauss was to contribute $3,300 as capital stock, and it ‘is established that he contributed only $1,300. The contention of the learned counsel for appellants is that Strauss was to have credit for $2,000 on his capital stock when he got the Miller Brewing Company to put in $2,000 in improvements under the contract with the Ered Miller Brewing Company, which provided that the Brewing Company would advance $2,000 to make the necessary repairs and improvements in the partnership premises and deliver all beer required by the partnership, and complied with the terms of the agreement. By virtue of this contract with the Miller Brewing Company the partnership agreed to buy 100 barrels of beer per year for a stated time and the Brewing Company agreed to credit each year $220 on the contract, if the partnership bought 100 barrels per year and performed its contract. Of course, whatever value there was in this contract with the Brewing Company, Strauss as a member of the partnership got the benefit of it. That was doubtless what ’William Strauss meant when he testified respecting the contract with the Brewing Company. He said: “That was really what lured me to come in as a partner, that $2,000 which the Brewing Company spent. I was to get the benefit of that, whatever profits were derived from [527] it, and was figured as part of my' interest, I having a one-third interest on a basis of $10,000,. apd Wildes having a two-thirds interest, and in accordance to that I had the papers drawn up by Mr. Frank Boden, .the attorney.” Mr. Boden’s memorandum made from statement of the parties as to terms of partnership was produced on the trial in connection with the testimony of -Mr. Boden. This memorandum recites: .' “Wildes has invested $6,700. Strauss is to bring in $3,300 in money and property.'-' Improvements are to be made in the first floor, including principally the café, the bar room and hotel lobby, and basement barber shop. And any improvements which said Strauss secures from any person to be made for the hotel on any consideration shall be credited to him asurn investment in the partnership the same as though he had paid in a like amount of money, and Strauss to pay in as much cash as shall equal the difference between the amount of improvements he secures for the company and $3,300. The partners then to own two-thirds in Wildes and one-third in Strauss. . . . The money or improvements brought in by Strauss to the extent of $3,300 to be used in improvements to the -first floor and the barber shop in the basement at once.” The contract of partnership, in connection with the other evidence, shows clearly that Strauss _was to pay in the balance, $2,000, in money or secure a like amount in improvements on the partnership property. To secure the improvements clearly meant that he was to pay for them or procure them without charge or burden to Wildes. Some point is made by counsel for appellants to the effect that, even if Strauss is liable for the $2,000, he is not liable to the receiver. This position cannot be sustained. The action was properly brought by the receiver to recover unpaid capital stock. It is further contended that the judgment should not have gone against William Strauss. We think the referee and court below were right in awarding judgment against both Oscar A. ■ Strauss and William [528] Strauss. William Strauss was tbe real party in interest, but for certain business reasons preferred not to sign the ■ articles of copartnership, and got Oscar A. Strauss to sign and act in his place, so William Strauss was bound as the real party in interest and Oscar was bound because a party to the contract of copartnership. It is also urged that the judgment does not dispose of all the issues in the case. All the issues were before the court .■and full opportunity afforded to litigate them, and we think .•all the issues were fully considered and disposed of both by the referee and the court. It would serve no useful purpose to extend this opinion iby going over the issues litigated for the purpose of showing 'that all matters embraced within the pleadings were disposed of. We think the judgment below is right and that no prejudicial error was committed. By the Court. — The judgment is affirmed.