Colgin v. Cummins
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Opinion
By Mr. Justice Thornton :
The bill was filed in this cause by Colgin, the administrator of Irby, against defendant, Cummins, who was “surviving partner of che firm of Cummins & Irby, and John T. Irby & Co. ; the object of which, was a settlement and recovery from the said Cummins, of the share of the partnership effects in his hands, due to him the said Colgin, as administrator as aforesaid. Upon the answer of the said Cummins, admitting the partnership, &c. a reference was made to commissioners, of the matters of account arising in the cause, whose report was the basis of the interlocutory and final decrees made by the court below. Upon the final decree, both parties ap[150]*150pealed to this court, and the assignment of errors by both, is by consent, argued, and to be determined together.
We will first consider the errors assigned by complainant, Colgin, which are three in number. 1st. That the chancellor overruled the exception of the complainant to the report of the commissioners, taken to their allowance of eight hun. dr'ed dollars, over and above the allowance for other expenses to Cummins, for his services in behalf of the firm, after the death of Irby. To the competency of the complainant to assign this error, the defendant, by his counsel, objects ; because he says that the exception, the overruling of which is the subject of assignment, does not appear to have been taken by him, whilst the matter was before the commissioners, and before they signed their report. As to the preliminary question, the court, I understand to be unanimous in their opinion, that it is competent to the complainant to make the assignment, though we arrive at that conclusion by different processes of thought.
My own conclusion rests upon this view of the matter.— We have a statute,
Before entering upon this question, it may not be unprofitable to ascertain, and bear in mind, the .nature of this partnership — the rights and duties imposed upon the parties by the original compact — and the true character of the personal service, for which compensation was allowed.
By the contract here, the parties covenanted to devote their •time and attention, exclusively to the mercantile concern, in which they wore about to embark; and stipulate, upon its dissolution, (after allowing to either any capital which he might bring into the concern) for an equal division of all the firm effects. The dissolution took place by the death of Irby. The immediate consequence of that event, was the devolution upon Cummins, of the right, and the duty, to do every act, and only such, as was necessary to the winding up of the concern. The payment of all debts due from the firm — the collection of all due to it — the conversion of all property into money — the creation of no new demands against the effects, except for necessary purposes — and finally, a fair division and allotment to the representatives of the deceased, seem to comprise the lawful rights and duties of the survivor in this partnership,
Having thus premised, so far as I deem important to the consideration of the question of the allowance of compensation, I now enter upon it, not so much with a view to maintain the doctrine I shall declare, by my own speculations of what the rule ought to be, as to show by the authorities, what it is. [152]*152If, however, it was my privilege jus dare, instead ofjusdicere, I do not know that I would settle it differently. According to my apprehension, the chain of authorities, (I will not say the unbroken chain, for I have not enjoyed the means of a sufficiently extended search into the books, so to say,) is adverse to the allowance.
Much of the argument of counsel, addressed to the court upon this point, was drawn from the supposed analogy of executors and administrators, and ordinary trustees created by deed, to this case of a surviving partner. With regard to the three former, the rule of the Englich Chancery, without exception, seems to deny them compensation. And this.rule is illustrated by adoption of Chancellor Kent,
This is not the case of an executor, or administrator, or of a trustee undertaking to execute certain acts of charity, or kindness, all of whieh “relate, as now existing, at least, to the voluntary transactions <¡>f other people’s affairs. I say, as now existing, for anciently, as to executors and administrators, that class of trustees could not properly be said to transact only business for others, as before the statute of distributions, the residue of the assets of the deceased, after payment of debts, was their own. It is the case of a man whose rights, and whose duty too it is, in consequence of his property being mingled by his own act, with that of another, to take care of it, and to do certain acts in relation it, for his own and that others’ interest, until a separation is made, which, in contemplation of law, can only be done by his ewft [153]*153action. Every act wbicli a surviving partner can lawfully do, is emphatically for himself; so much so, that he could refuse to the representative of the deceased, any participation in it.
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By Mr. Justice Thornton :
The bill was filed in this cause by Colgin, the administrator of Irby, against defendant, Cummins, who was “surviving partner of che firm of Cummins & Irby, and John T. Irby & Co. ; the object of which, was a settlement and recovery from the said Cummins, of the share of the partnership effects in his hands, due to him the said Colgin, as administrator as aforesaid. Upon the answer of the said Cummins, admitting the partnership, &c. a reference was made to commissioners, of the matters of account arising in the cause, whose report was the basis of the interlocutory and final decrees made by the court below. Upon the final decree, both parties ap[150]*150pealed to this court, and the assignment of errors by both, is by consent, argued, and to be determined together.
We will first consider the errors assigned by complainant, Colgin, which are three in number. 1st. That the chancellor overruled the exception of the complainant to the report of the commissioners, taken to their allowance of eight hun. dr'ed dollars, over and above the allowance for other expenses to Cummins, for his services in behalf of the firm, after the death of Irby. To the competency of the complainant to assign this error, the defendant, by his counsel, objects ; because he says that the exception, the overruling of which is the subject of assignment, does not appear to have been taken by him, whilst the matter was before the commissioners, and before they signed their report. As to the preliminary question, the court, I understand to be unanimous in their opinion, that it is competent to the complainant to make the assignment, though we arrive at that conclusion by different processes of thought.
My own conclusion rests upon this view of the matter.— We have a statute,
Before entering upon this question, it may not be unprofitable to ascertain, and bear in mind, the .nature of this partnership — the rights and duties imposed upon the parties by the original compact — and the true character of the personal service, for which compensation was allowed.
By the contract here, the parties covenanted to devote their •time and attention, exclusively to the mercantile concern, in which they wore about to embark; and stipulate, upon its dissolution, (after allowing to either any capital which he might bring into the concern) for an equal division of all the firm effects. The dissolution took place by the death of Irby. The immediate consequence of that event, was the devolution upon Cummins, of the right, and the duty, to do every act, and only such, as was necessary to the winding up of the concern. The payment of all debts due from the firm — the collection of all due to it — the conversion of all property into money — the creation of no new demands against the effects, except for necessary purposes — and finally, a fair division and allotment to the representatives of the deceased, seem to comprise the lawful rights and duties of the survivor in this partnership,
Having thus premised, so far as I deem important to the consideration of the question of the allowance of compensation, I now enter upon it, not so much with a view to maintain the doctrine I shall declare, by my own speculations of what the rule ought to be, as to show by the authorities, what it is. [152]*152If, however, it was my privilege jus dare, instead ofjusdicere, I do not know that I would settle it differently. According to my apprehension, the chain of authorities, (I will not say the unbroken chain, for I have not enjoyed the means of a sufficiently extended search into the books, so to say,) is adverse to the allowance.
Much of the argument of counsel, addressed to the court upon this point, was drawn from the supposed analogy of executors and administrators, and ordinary trustees created by deed, to this case of a surviving partner. With regard to the three former, the rule of the Englich Chancery, without exception, seems to deny them compensation. And this.rule is illustrated by adoption of Chancellor Kent,
This is not the case of an executor, or administrator, or of a trustee undertaking to execute certain acts of charity, or kindness, all of whieh “relate, as now existing, at least, to the voluntary transactions <¡>f other people’s affairs. I say, as now existing, for anciently, as to executors and administrators, that class of trustees could not properly be said to transact only business for others, as before the statute of distributions, the residue of the assets of the deceased, after payment of debts, was their own. It is the case of a man whose rights, and whose duty too it is, in consequence of his property being mingled by his own act, with that of another, to take care of it, and to do certain acts in relation it, for his own and that others’ interest, until a separation is made, which, in contemplation of law, can only be done by his ewft [153]*153action. Every act wbicli a surviving partner can lawfully do, is emphatically for himself; so much so, that he could refuse to the representative of the deceased, any participation in it. If upon examination, the current of authorities sustains the position, that a surviving paitner, is not to be allowed, except an indemnity for actual expenditure, I would not feel authorised to abandon it, because a preponderance of authority is in favor of such allowance to executors, administrators, and trustees generally, other than surviving partners. Nor would I be concluded in relation to the case of executors, administrators, and trustees generally, having no interest in the subject matter of the trust, by refusing compensation to a surviving partner, for his time and labor in winding up the business of the firm, in which his interest, by his own act, has been complicated for purposes of advantageous traffic, with that of another. Leaving then, the debated ground, oftrus-tees generally, who have no interest in the trust, without ad-ing my own opinion to one side or the other, I will briefly advert to the authorities in relation to the case of a surviving partner, which arc none other than those produced in the argument, by the commendable industry of the counsel concerned.
The doctrine is laid down in the following words : “ A surviving partner, where there is not an express stipulation to that effect, is not entitled to charge in the account, a sum of money, as a compensation to himself for his management of the trade, and for his timo and labor,” &c. The'only case referred to by this elementary author, in support of the text, is that of Burden vs. Burden,
The editor of the edition of Goiv, to which reference was made, appends various additional authorities to the same point; which, so far as opportunity was allowed me to inspect, I have examined, and find corroborative ' of the position. The authority of the last case referred to, above, is [154]*154contended by the counsel for Cummins, to have been destroy-e& by a decree subsequently pronounced by the same chancellor, in the case of Brown, adm'r of Mongin vs. De Taffitt.
It would indeed, be a fact somewhat remarkable, to say the least of it, that a chancellor, and that chancellor Lord Eldon, shoidd have thus overruled the doctrine, which he himself has solemnly declared, without even adverting to his former adjudications. But I do not think he has done so. In the last ' decree which the report of this case discloses, a. reference is ordered to the master, directing him to permit such claims ■ for the management, transacting, and carrying on of the business to be submitted to him, as the surviving partner was advised he ought to have ; and directing him further, to state the facts and reasons, upon which he shall have adjudged any al prwances to be just allowances, if on behalf of plaintiff he shall be requested to do so ; and state the facts and reasons, upon which he shall adjudge any allowance prayed not to be just, if he shall be requested by defendant so to do.
It is not apparent from the case, what was the nature or extent of the allowances contemplated; for the chancellor expressly says, in answer to an objection to a former order, making allowance to De Taffitt, for his personal services and credit — page 140, “ I do not mean to intimate whether the master should allow wages or compensation ; but it cannot be denied, that if the business be such, that on the death of the party, other persons are concerned in aiding it, by the appli- . cation of their skill, their services, and their money, a great , deal may be included under the head of just allowances, which till the master has thoroughly sifted it, the court cannot determine.” The vice chancellor’s order, commanding the master so to take the account, as to show what was reasonable compensation for the personal services and attention of survivor, was .reversed by the chancellor, and another account [155]*155ordered, as above stated, which should disclose the grounds upon which any allowance claimed, should be either admitted or rejected by the master. If I were to concede that the allowance here contemplated by the chancellor, was for the personal services of De Taffitt, and not for those of other persons who were also engaged in the transaction of the business, carried on with the funds of the deceased ; yet the facts of the case are so variant from those of Burden vs. Burden, and of the case before us for adjudication, that the concession woujd not be material. The business in that case, was a dealing upon money and bills of exchange, and was carried on by making new adventures on the funds, after the death of Mongin ; in which case, his representatives might either have claimed the money of the deceased, with interest,
The second error assigned, is, “(That the chancellor overruled the exception to the report, taken to the refusal of the commissioners, to make rests in the individual accounts by ' the partners, and to charge interest on the balances of the [156]*156largest account.” I do not think there was any error com-mittecl by the chancellor in the particular here brought to view ; interest upon an open account is not reasonable, as a matter of strict right, unless agreed to be paid ; it is often allowed by juries, and decreed by chancellors, in the nature of damages, for the detention or withholding of money ; but in all such cases, there is,an evident default in the party charged with it ; or if a profitable use be made of it, though there be no default in the persons holding the money, interest is equitably chargeable, as in the case of executors and administrators, who aré not, by our law, chargeable with interest on money, unless they have turned it to profit.
The particular objection urged here, is, that the account was not so taken as to charge interest throughout the existence of the partnership, by making rests at the end of every year. It seems to my mind, that such was not the understanding of the parties, or else they would so have kept the account, which by the commissioners’ report, was not so kept • therefore, there is no foundation to charge interest on the ground of an agreement to pay it on this annual balance ; nor docs it appear, that on the other grounds suggested, interest is chargeable. If it had been shown by proof, that more was drawn ont than was necessary to the support of the party, sought to be charged with interest, on the balance against him, then I should think there would be a fair ground in equi-t„ t0 chargC him, but not otherwise.
If the assignments were so extended as to embrace every question respecting interest, growing out of the report, with my views of the rights and duties of the surviving partner, and of the whole case as it appears upon the record, I could not say that there was any such default in him, in withholding any funds, or any such turning of any of them, to his own profitable account, as,would make him in equity, liable to the payment of interest.
The third and last assignment of error, on the part of the [157]*157¡complainant, relates to tbo allowance by the commissioners, of a credit for loss on sale of cotton.
üpon inspecting the report,’we find the cotton on which the" loss accrued, to be stated as the property of the firm, and the evidence of that fact, as well as of its loss, though not disclosed, must now be presumed to have been satisfactory to the commissioners. According to the agreement before mentioned, argument was also had, upon assignment of errors by the defendant, Cummins, who also appealed from the final decree. The first error assigned by him, was the disallowance and set off, against the amount decreed to be due, and payable from him to the complainant, a note or due bill, executed by decased partner to witness Comegys, and by him transferred for valuable consideration, to the defendant, subsequently to the death of complainant’s intestate, and also to the institution of the suit by him against the defendant. The allowance of the set off here claimed by the defendant, is resisted on a variety of grounds. I do not deem it necessary to notice them all, as there is one view of the subject which satisfies me, that the decree was correct, in repudiating it. It is conceded that this claim would not be allowed, as a set off in a court of law, if acquired after the institution of the action, on the principle, that the rights of the parties must abide as they were at that time. I will not undertake to say, that in chancery, a set off will in no case be allowed, which was procured by the defendant after service of the subpoena; for however it may be as to the mere question of jurisdiction, or under what circumstances the defendant may be permitted to urge an acknowledged set off, certain it is, that a court of equity follows the same general rules as a court of law, respecting the nature of the set off.
By Mr. Justice Saffold :
The merits of the controversy may be resolved into the following questions.
1st. Was Cummins entitled to compensation, for his services in continuing and closing the business of the firm, after .the death of the partner, or only for his expenses actually incurred ?
2d. Was it legal and proper that annual rests should have been allowed on the balance appearing to have been due from the surviving partner, more than was due from the deceased partner, on their individual account with the firm?
3d. Ought the loss on the cotton, purchased and sold, to [159]*159have been allowed by the commissioners as a loss of the firm, or of the surviving partner alone ? .
4th. Was the individual note of Irby, procured by Cum-mins after the institution of this suit, a proper set off for allowance by the commissioners ?
5th. Should the costs of the suit have been decreed against the defendant, or should they have been charged against the effects of the firm, as directed by the final decree P
My remarks will be directed mainly to the first point," as on that alone, my views materially differ from those of the majority. The regular business of the firm, by selling the goods, &c. at private sale, appears to have been continued by Cummins, as surviving partner, only a few months. The circumstance of this having been consented to by the father in law, and who has since been appointed administrator of the deceased partner, and by Comegys, one of the distribu-tees of his estate, together with the situation of the concern at the time, which is admitted to have justified the course, is satisfactory to me, as respects the propriety of thus continuing, and the motive which prompted the surviving partner to it. His right to compensation for the service, in continuing the sales, and closing the business, is contested ; it is insisted, that neither a surviving partner, an executor, administrator, or any trustee, is legally entitled to compensation for his services in the management of the business, unless provided for by agreement.
■ In support of this position, reference is made to various authorities, which clearly sanction the doctrine, especially in the case of executors and administrators, and trustees, appointed by ordinary grant. Contrary authorities are also cited, some of which are directly applicable to the present case. It therefore becomes necessary, briefly to collate a few of them on either side, examine the reasons of them, and determine the preponderance.
In Franklin vs. Robinson,
The parties were all living, each performing the duties assigned, them relative to the concern, and the party whose compensation was in question had acted under a special agreement, by which he was to receive ten thousand dollars for his services, on a certain event, which never happened. The remarks of the chancellor are these, “ It seems to be inconsistent with the object and intention of the parties in making the contract, to allow the defendant to recover on a quantum meruit, merely because the contingency had not occurred on which the extraordinary and specific allowance for the same services, was made to depend.” Again, he says, “ each joint owner, in taking care of the joint property, is taking care of his own interest, and the law never undertakes to measure and settle between partners their various and unequal services bestowed on the joint business. This must be left to be regulated by eontract.” This language clearly applies to the attention which may he'bestowed on the joint or partnership interest, pursuant to the original undertaking, and which, by implication, excludes the allowance. But it is worthy pf inquiry, whether the happening of an event, not contemplated by the parties, which throws the whole burthen on one, and even deprives them, of the power to stipulate an agreement, as in case of death, does not vary the principle. On this point several authorities will presently be noticed*
In the case of Green vs. Winter,
The case of Manning vs. Manning,
In Robinson vs. Pitt,
In Ayliffe vs. Murry,
I wrould liereobserye, with respect to the reason suggested by Lord Talbot for refusing the allowance, that it cannot be very satisfactory. Trustees are usually selected with reference to their honor, integrity, and sense of justice, and much must depend on these virtues, for a true disclosure and faithful execution of the trust in other respects, as well as in relation to their compensation. Nor can I conceive, that the difficulty in ascertaining the amount of receipts and payments in the management of a mercantile concern, or formance of many other trust duties, or in de length of time necessary for the execution (wlWcirwould fair data for the compensation) would be great other assignments or computations often required of courts ’ chancery. As to the honorary nature of the prehend that most American citizens, while engtf management and settlement of complicated estates, or mercantile concerns, would view this objection to their compensation, much in the same light that the Ameriean bar have regarded the English rule relative to honorary professions! services. I would not, however, be understood to question the justice or authority of the rule, in the case of trusts of the ordinary kind, where the object is to secure a debt, indemnity, or other benefit, to the trustee or his friend; -nor in the case of living partners, who have voluntarily undertaken to carry on trade for their joint benefit. In the former case, the object to be effected, or a motive of friendship, is presumed to have been the inducement for the undertaking. In the latter, the interest of the parties is relied, upon to stimulate each to the services required of him, and if he partially fail, from [164]*164indolence, incapacity or other cause, intrinsic difficulty would truty arise, in determining the comparative value of the services of each. Ye(, I would not readily concede, that a gross neglect of duty by one partner, devolving extraordinary labor on the other, would be without remedy in the tribunal which scrutinises the equity and justice of each case.
Another main reason for denying the compensation to ordinary trustees and partners, where none has been agreed on, is, that the parties, in full view of all the circumstances, have entered into an express agreement, to prosecute an enterprise, in which the personal services of one or both, in an an_ ticipated degree, will be obviously necessary.
The agreement, which is generally by deed, has provided for compensation, or it has not, and the contract should govern while it continues in force. The parties have undertaken, in confidence, that each will comply on his part, with the spirit of the agreement.
In the case of a partnership limited as to its existence, if the neglect or misconduct of either be such, as to render it impossible to carry on the partnership on the terms on which it was entered into, on application of the other partner, a court of chancery will dissolve it.
If the partners have become dissatisfied, and lost confidence in each other ; or if they, having the ability, choose not to agree on an allowance to either for the management of the business, one or both must proceed without, or apply to chancery for the appointment of a proper person to transact the business, who will doubtless be entitled to compensation, though he is to act in the capacity of trustee.
[165]*165A claim of allowance between living partners, which has not been provided for, I maintain, is different from that in favor of a survivor, who possessed the confidence of the deceased during his life time, and who, with the approbation and consent of his heirs and representatives, as in this case, afterwards continued to sell out the effects by retail, and to wind up the concern, for the mutual profit of all persons interested. In such case, the necessity of his acting in person or by agent, is absolute ; he is the most suitable, if not the only proper person to bestow the attention ; the necessity of this extraordinary attention has been created by a subsequent unforseen event, which may account for its not having been provided for in the deed ; and the services were bestowed after the original connexion had ceased. Justice would therefore seem to demand of the representatives a reward for their labor, in proportion to their benefits received from it. Had a manager or receiver been appointed, as would otherwise have been necessary, though less competent than the survivor, he must i have been paid ; then why not make the s ervices of the survivor equally a joint expense ? To pay him out of the sepe-rate interest of the deceased has not been thought of, and this is an answer to the argument that he was attending also to his own business.
Perhaps none of the authorities relied on, in opposition to this allowance, justly applies to a surviving partner, under similar circumstances, unless it be a decision of Lord Eldon, in 1813, and references to it. I think I shall be able to show, that this decision has been subsequently departed from by the same chancellor, and that its authority has been rejected by many eminent jurists. The case alluded to, is Burden vs. Burden.
■ The third was an action at law, to recover compensation for personal services, and for money expended: the court held, that the plaintiff and defendant, and several others, were partners in the business, concerning which the claim was made ; consequently, that the action could not be maintained ; and which I would say, was a clear principle. The action at law was an inadequate remedy between the partners, and even in chancery, the other partners should have been made parties. Had the suit been in chancery, it may be well inferred, the result would have been different, as the claim for moneys actually expended at the request of the °^iers> was denied, as well as that for the personal labor. Holmes vs. Higgins.
On a hearing before the Lord Chancellor, he says, “ it is not in the ordinary course of the court, in matters, of this nature, to say, in the first instance, what is a just allowance. I do not say that it was an improper consideration, what was a just allowance, but this was not the proper mode of getting at it.” He continues, saying, “ the same observation applies [168]*168to the inquiry as to what will be a reasonable compensation f°r Tastet’s personal attention. I do not mean to say, ' that the master should not have made such an allowance, or that the court might not, by the original decree, have directed his attention to it, but I think it could not be done upon exceptions.” In conclusion, he says, “ What I propose to do, is, so to alter the original decree, as to bring out the case to which the principles that ought to govern, as to the profits, may be applied; to give such directions as may be necesary for that purpose, and to explain what it may be competent to crave as just allowance. I do not mean to intimate, whether the master should allow wages, as they arc called, or compensation ; but it cannot be denied, that if the business be such, that on the death of the party, other persons are concerned in aiding it by the application of their skill, their services, or their money, a great deal may be included under the head of just allowances, which, till the master has thoroughly sifted it, the court can not determine.” Accordingly it was ordered, inter alia, that De Tastet should have liberty to submit to the master any claims as just allowances which he might consider such, “ by reason or on account of the management, transaction, and carrying on the business or concern at any period,” by himself or either of the other partners, or any other person. No final decree was then pronounced on the claim to compensation, but the opinion of Lord Eldon was fully expressed, that under the presumed facts of that case, the allowance should be made. No dissatisfaction was manifested by the complainant, but De Tastet appealed to the House of Lords, where this decree was affirmed. 1 can discover nothing in the nature of that claim to distinguish it, in principle from this.
In the State of Massachusetts, the principle is believed to prevail, which would sustain this claim. In Wilby vs. Phinney, adm'r,
The opinion of the Supreme Court of that state, on this point, is thus expressed — ” It has been objected that an action does not lie against the defendant as administrator, for the plaintiff’s expenses in collecting the debts, and managing the concerns of the copartnership, since the decease of Harrison ; and this is certainly true. But these expenses may be allowed, by making a deduction from the amount of the property withdrawn by the plaintiff from the partnership stock.” In this way, said the court, justice may be done, without violating any rule of law ; and judgment was entered accordingly. Though the court uses the words, plaintiff’s expenses, in allusion to his reported compensation, as no other Item was reported, to which the language can apply, and the opinion takes no other notice of this item, the reference clearly is to the allowance, “ for his labors in settling the affairs of the company, since the death of his late partner.” ' .
[170]*170In opposition to the argument, that trustees'generally, in-' eluding executdrs, administrators, &.c. are denied compensation in the United States unless provided for by express agreement, I will briefly notice a few Virginia eases, which appear to be founded on no statutory authority ; from which it will appear, that the usual compensation to executors and administrators, in that state, is five per cent, commission for their services, on their receipts and disbursements. Also, that the courts of that state, maintain that the English rule, in this respect, is in derogation of the true principles of the common law ; or at least, that it is too unreasonable to be enforced in the United States, where the customs and usages are essentially different. Similar views are understood to have generally prevailed in the courts of this state, in relation to executor and administrator. In many cases I would consider five per cent, extravagant. I would gratify no mercenary or speculative views, but make such reasonable allowance as would ensure faithful and competent trustees.
In the case of Fitzgerald vs. Jones,
In Tripletts ex'r. vs. Jamison,
In McCall vs. Peachy's adm'r,
On the question of the right of the trustee to compensation for his services in performing his trust, Chancellor Taylor expressed himself with pinch zeal, thus: “ We considered the rule of the English courts, denying compensation to trus- . tees for their labor and pains, incompatible with that standard of justice, which commands us “ to live honestly, hurt no body, and render to every one his due” He assimulates the right to that of commissioners acting under an order of court, where they have sold property and received the money, ■ in which case he said he knew of no instance in which a commission had been refused. He said it. had been considered a hardship in England, where the rule was suffered to obtain, and had never taken foot-hold in this country.
From this review of the authorities, I think in a case like the present, that a reasonable compensation for the service, skill, and attention of the surviving partner, in continuing the - business by private sales for a short term, for the joint' benefit, from which profit is presumed to have been made, and af-terwards closing the concern in the usual and more summary mode, is sustainable on principle and authority ; that though it be otherwise, where all the partners survive, to contribute mutually the services originally contemplated, and there has been no agreement to compensate the services of either ; yet, that the linforseen event of the death of one, devolving the whole dr greater duty on another, by which the interest of tjhe deceased is advanced, must entitle the survivor, in justice and in equity, to a reasonable allowance for his services.
[172]*1722. I will more concisely consider tbe question of interest, on ^ie balance that may have been found due to the estate of the deceased partner.
- The correct doctrine is believed to be maintained, in the case of Staughton vs. Lynch.
If the business'be properly continued, as in this case, beyond the death of one of. the partners, the subsequent date when the business ceases would appear to be the true period. If, however, the property be not disposed of, or if sold, the debts not due, the rest should be made only from the time of their maturity; and if due from persons unconnected with the firm, only from the time when it was practicable to effect collection, charging the survivor, until then, such simple interest as may accrue on the debts, .
[173]*173As respects the proceeds of this closing auction sale — as the surviving partner was the sole purchaser, and on a credit of twelve months, I would place the rest for the deceased partner’s share of so much, at the expiration of this term of credit, that is, the first of January, 1829. The principle of annual rests, does not appear justly to apply to a case like the present.
The case of Shieffelin vs. Steivart,
The master, in stating an account, after allowing a reasonable time for the settlement of the estate, charged com~ found interest, making annual rests in the account for that purpose, which was confirmed by the court. The chancellor, in rendering the decree, gives this illustration of the doctrine: he says, “ it is certain that the allowance of compound interest is often essential to carrying into complete effect, the principles of the court, that no profit, gain, or advantage, shall be derived to the trustee from diis use of the trust, funds. All the gain must go to the cestui que trust. This is. •the true equity doctrine. It secures fidelity,' and removes temptation: and it is the ground of this allowance of annual rests, in the taking of the account, where the executor has used the property, and does not disclose the proceeds.” To ■ bring the suryiving partner, in this case, within the influence of the principle of annual rests, it should be made to appear, that after the lapse of sufficient time to ascertain the clear balance due to the estate of the deceased partner, or some certain portion of it, the former refused to account for, and pay it over, without any reasonable excuse for the delay or refusal ; or that having such balance in his possession, he has speculated upon it, and made profit exceeding the rate of simple interest.
For a farther illustration of the rule relating to rests for the computotion of interest, reference ma.y be made to the [174]*174case of Van Benshooten vs. Lawson.
. This is deemed a sufficient reference to authorities, to show that compound interest, whether by making rests for the computation, or otherwise, is not favored in law or equity, and though it is sometimes allowed against trustees, it is only where there has been some gross neglect, or violation of duty, or a profit made on the trust fund; circumstances, which do not sufficiently appear in this case, to subject the surviving partner b(eyond the liability mentioned.
These views are believed hot to sustain this assignment of error, as presented ; and it was more in reference to the importance of the principle, than any difference of opinion among the members of the court, that I was induced to express my seperate opinion on this point.
[175]*1753d, 4tb, 5th. On all the remaining questions, I concur in the decision pronounced by Judge Thornton — that the record does not disclose any facts, to justify a rejection of the reported allowance for the loss on cotton, as a just charge against the firm — that the note offered as a set off was not allowable in this suit, under the circumstances of the case; and that the costs of this suit, in the court below, were properly decreed to be paid by the surviving partner, ^out of the partnership effects.
My reasons so nearly correspond with those already given, that I decline a 'seperate expression of them.
Aik.D. 288, 289, s. 22.
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1 Port. 148, Counsel Stack Legal Research, https://law.counselstack.com/opinion/colgin-v-cummins-ala-1834.