Wendell v. Clark

Braley, J.

The bill alleges, the answer admits and the master finds, that the parties at some time previous to October, 1908, entered into an agreement to trade in stocks through Francis Henshaw and Company, a firm of stockbrokers. The account was opened by, and always stood in the name of the plaintiff who deposited therefor certain bonds and shares of stock. The defendant, an employee of the firm, was to supervise the account, and all profits and losses were to be shared equally. The master, while finding these facts, did not pass upon the question of partnership but left it for the decision of the court. It was a question of fact within his province to decide. But, whether treated as a partnership or as a joint adventure for their mutual benefit, either party if dissatisfied could demand an accounting. Forino Co. Inc. v. Karnheim, post, 574, and cases cited. The defendant terminated his employment sometime in April, but the plaintiff did not know it until immediately prior to November 4, 1910, when, without consulting the defendant and without his assent, he caused another firm of stockbrokers “to take over the account,” pay the amount due, and receive the securities. The plaintiff contended before the master and contends here, that as a result of the defendant’s management he has suffered large losses, for one half of which he should be reimbursed.

*565The securities having been taken over and the agreement having been expressly limited to the term of the defendant’s employment, the joint undertaking ended “on or about November 14, 1910,” when the plaintiff either is shown to have known, or to have had at his command full sources of information relating to their speculations shown by the books of Henshaw and Company. It is at this time that his right to an accounting for alleged mismanagement accrued. Kennedy v. Porter, 109 N. Y. 526. The present suit was begun by writ dated May 12, 1919, and the statute of limitations has been pleaded. The rule sometimes applied, that the statute does not begin to run as between partners after dissolution until the partnership debts have been liquidated, has no bearing in the case at bar, as there were no outstanding obligations. Riddle v. Whitehill, 135 U. S. 621. The defendant also was not a liquidating partner, or adventurer, and, no actual fraud having been shown and the relations of the parties at that time having become adverse, the bill cannot be maintained unless the defendant’s letters interrupted the statute. Farnum v. Brooks, 9 Pick. 212, 245. Sawyer v. Cook, 188 Mass. 163. Sunter v. Sunter, 190 Mass. 449, 456.

The plaintiff, as previously said, did not consult the defendant before transferring the securities and made no complaint concerning the defendant’s conduct until February 1,1915, when he wrote the defendant, who was his brother-in-law, “it is time that I should hear from you in some definite and substantial way, both on the matter of back interest and on the matter of an amount of money which you drew from the account before you left Henshaw.” The defendant at first replied that he had drawn $250 from the account for his personal use and would repay it “as soon as his present affairs would permit,” and later sent a check to the plaintiff for this amount. But subsequently on December 21, 1917, he wrote the plaintiff enclosing a statement in detail of the account showing" a net profit instead of a loss as the plaintiff claimed, and stated that under a mistaken impression as to the true condition of the account, he had sent the check, the amount of which he asked the plaintiff to repay. The letters are to be read together to determine whether the defendant made the payment as a partial acknowledgment of an admitted existing liability. See R. L. c. 202, § 1, cl. 1, § 13; Day v. Mayo, 154 Mass. 472. “The nature of the *566act is to be determined by the intention of the debtor as shown by the act, his words, and the circumstances accompanying and explaining it.” It is a question of fact which the master left: undecided. Gillingham v. Brown, 178 Mass. 417, 424. The trial judge however could draw inferences of fact from the facts-reported, and properly could find under all the circumstances, shown by the report, that the payment was in accordance with the defendant’s promise to repay the amount withdrawn for his-personal use, to which it should be limited, or that on all the correspondence the payment was made by mistake. Danforth v. Chandler, 237 Mass. 518. And no payment having been made-which took the plaintiff’s claim out of the operation of the statute,, his ruling that it was barred, should not be reversed.

The plaintiff also failed to make out a case on the merits. The-master states, “It is impossible, from any evidence before me, to make any finding as to whether the transactions under the account: in question resulted in a profit or a loss.” The plaintiff requested him to find that “he has proved the liquidation of the securities', contained in the joint account.” The request was refused because-there was no competent evidence that such liquidation had been-effected. It would not have helped the plaintiff if the master had so found. The evidence is not reported, and no finding appears that any act of the defendant caused an impairment or loss of the securities originally deposited, or contributed by the plaintiff. Braman v. Foss, 204 Mass. 404, 411. Wilde v. Sawtelle, 232 Mass 117, 123. His exceptions to the master’s report were overruled rightly. The conversations in the defendant’s absence between the plaintiff and a member of the banking firm to whom the securities were transferred were mere hearsay. The offer of proof, that he delayed bringing suit because of the defendant’s indigent circumstances prior thereto, could not stop the operation of the statute of limitations for reasons sufficiently stated.

' The result is, that, the defendant’s appeal from the interlocutory decree overruling his demurrer, not having been argued, must be treated as waived, and the interlocutory decree overruling the plaintiff’s exceptions and confirming the report, and the final decree dismissing the bill, are affirmed with costs of the appeal.

Ordered accordingly.