McElroy v. Whitney

AILSHIE, C. J.

A rehearing was granted in this case and it was again argued at the present term. The question dwelt upon and most strongly argued on the rehearing is, “the entire failure on the part of the referee and the court to furnish a statement of the items allowed and disallowed.” As may be observed from an examination of the former opinion in this case, the referee did not report a statement of account between the parties — he did not report the debits and credits or the items allowed and disallowed in favor of and against each party. The powers and duties of the referee in this case are measured by the order of reference and the essential purpose of that order and the object of the appointment appears to have been “for taking such account”; namely, an accounting between the parties. The question did not arise in this case as to the power of the referee to make findings of fact and conclusions of law, but the action of the trial court seems to indicate that such power was not conceded. Counsel for appellant claim that the court took the view announced in Bradshaw v. Morris, 20 Mont. 214, 50 Pac. 554, and Murphy v. Patterson, 24 Mont. 575, 63 Pac. 375, as to the power and authority of the referee under the order of reference. As we view this case, however, after a further examination thereof it occurs to us that the vital question is as to whether the referee has discharged the duties for which he was appointed *529and whether the court should have accepted or rejected his report. In 24 American and English Encyclopedia of Law, second edition, 234, the author in considering the rights of the parties in such case says: ‘ ‘ The parties are entitled to a statement from the referee of all the items of account between them, in order that either may, if he thinks proper, except to any particular item.”- To the same effect is 17 Encyclopedia of Pleading and Practice, 1037, and 15 Encyclopedia of Form and Procedure, 956.

The respondent contends that since the dealings and transactions of the parties cover several thousand items, it would be an endless task to report each item and the action of the referee thereon. The contention is not sound, for the reason that the referee has of necessity had to arrive at the conclusion as to the amount due'from some data or computation of accounts. As said by the supreme court of Washington in Park v. Mighell, 3 Wash. 737, 29 Pac. 556: “He must have had some data from which to arrive at that sum, and he should have given the court the benefit of that by stating clearly what items he allowed for and against each party. In other words, he should state the account between them. It is only by so doing that the court can intelligently review his action and decide whether to confirm or reject it.” (Hurdle v. Leath, 63 N. C. 366; McCampbell v. McClung, 75 N. C. 393; Reed v. Jones, 15 Wis. 40; Gage v. Arndt, 121 Ill. 491, 13 N. E. 138.)

In this case the order required that the defendant W. G. Whitney, who was the surviving partner, and as such in charge of the books, accounts and vouchers pertaining to the business for which the accounting was to be had, should “make and file with the said referee, not later than the first day of July, 1902, a debit and credit statement of the accounts between himself and the decedent, John G. Whitney, and plaintiff herein and his predecessors as administrators of the estate of said John G. Whitney, deceased.” The statement of account was made and filed by the defendant, and we see no good or valid reason why the referee could not have re*530ported to the court the account as taken by him, and what should be allowed and what rejected. If it is true that the parties or either of them had not the right to insist on that being done, their right to object and except to the report or any part thereof, and have it reviewed by the district court or on appeal, is an idle thing of no virtue or protecting force, and a delusive snare to the unwary. For the failure of the referee to make a statement of account as directed by the order and to report the same to the court, we are convinced that the judgment should be reversed. Judgment is reversed and cause remanded, with directions to the trial court to take further action in accordance with the views herein expressed. Under the circumstances of this case and in view of the whole record we have concluded to require each party to pay one-half of all costs incurred on this appeal.

Sullivan, J., concurs. Stewart, J., took no part in the decision.