U.S. Supreme Court JAMES v. BROWNE, 1 U.S. 339 (1788)
1 U.S. 339 (Dall.)
Supreme Court of Pennsylvania
July Term 1788
This was an action of Account render, brought by one Partner against another, and several issues were joined on the pleas, 1st of Ne unques Receiver, and 2nd Fully accounted. In the declaration the Plaintiff and Defendant were named Merchants, and the Defendant was charged as a Receiver of monies to the joint benefit of the company front three persons, and the proof was of a receipt from one of them.
For the Defendant, it was contended, that as he had not been charged as Bailiff, in order to make him accountable as Receiver, it was incumbent upon the Plaintiff to state in his declaration, by whose hands the monies were received, and to prove, accordingly, a receipt by the hands of such person, or persons. Bull L. N. P. 121. That unless the proof went to all the persons stated in the declaration, he failed in his action; or, at least, that the verdict must be conformable to the evidence, which was only of a receipt by the hands of one, so that the judgment quod computet, pursuing the verdict, must be restricted to that receipt alone. [339-Continued.]
But it was answered, and so ruled by the Court in their charge to the Jury, that, however the law stood in the case of a Common Receiver, yet, as between Co-partners, the action of Account render would be nugatory, if the same doctrine prevailed. That in Pennsylvania particularly, where there is no Court of Chancery to compel a disclosure of the numerous and extensive transactions, which one partner might manage for the joint benefit of the company, there would be no remedy, unless this action were liberally extended. That between partners, therefore, it is sufficient for the Plaintiff to charge the Defendant, generally, with the receipt of the money to their joint benefit; and having proved a receipt by the hands of any one of the persons mentioned in the declaration, he is entitled to a general verdict upon the first issue. Then, on the judgment quod computet, all the accounts between the parties will come before the auditors, without particular respect to the receipts proved upon the trial.
No evidence being offered by the Defendant, in support of the second plea, the Jury gave general verdicts for the Plaintiff upon both issues: and thereupon judgement quod computet was entered.
Afterwards, when the Court were about to appoint Auditors in this cause, the Chief Justice made the following observations:
M'Kean, Chief Justice.
The necessity of a liberal extension of the action of Account render between joint partners, is apparent, not only from the nature of the case, but from this circumstance also, that the parties would otherwise be destitute of any means to arrive at justice: For the action on the case, though beneficially construed in modern practice, would certainly be inadequate, and we have no Court of Chancery to interpose an equitable jurisdiction. The action of account has, we know, been almost disused in England for a century
past; but this is owing to the greater facility of obtaining settlements in the Court of Chancery, by a reference to the masters; and there are many cases in the books which point out the expediency and propriety of the interference of that Court. If, indeed, it had not assumed a competent jurisdiction in this respect, I am persuaded, that, in order to accomplish justice, the Court of King's Bench would have done what we are now obliged to do. For, it is the duty of Judges to see the laws faithfully administered, and to promote the proper means for obtaining that end.
Hence it is, that here, in an action of Account render between partners, if these facts are proved that a partnership existed that the Defendant was the acting partner and that he received any part of the sum, from any of the persons mentioned in the declaration we shall uniformly oblige him to render an account of his transactions. It would be hard, indeed, if, while the books and documents remain in the hands of the Defendant, the Plaintiff were bound to state in his declaration every receipt in which he was interested, and to be condemned to lose, under such circumstances, his portion of every credit he omitted to insert, in the course of a mercantile transaction, consisting, perhaps, of ten thousand items.
It should be observed, likewise, that there is a distinction in the general law as to Bailiffs and Receivers; the former being entitled to reasonable expences, which the latter cannot recover. This distinction, however, does not apply to the case of partners in trade; for, one partner, though charged as a receiver, is entitled to every just allowance against the other.
Nor does the verdict of the Jury affect the principles of the settlement; for, suppose I engage in trade with another man, and pay into his hands a L.1000, as my share of the stock; if, afterwards, I bring an action of Account render against him, and the Jury find the receipt of this money; such finding does not surely fix the sum for which he shall be responsible to me, but the auditors will, nevertheless, on the one hand, allow me a proportion of any profits which have been accumulated; or, on the other hand, charge me with a proportion of any losses or expenses that may have happened in our joint negotiations. Co. Lit. 172. a. sec. 259.