Frear v. Lewis

166 A.D. 210, 151 N.Y.S. 486, 1915 N.Y. App. Div. LEXIS 6531
CourtAppellate Division of the Supreme Court of the State of New York
DecidedJanuary 22, 1915
StatusPublished
Cited by5 cases

This text of 166 A.D. 210 (Frear v. Lewis) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Frear v. Lewis, 166 A.D. 210, 151 N.Y.S. 486, 1915 N.Y. App. Div. LEXIS 6531 (N.Y. Ct. App. 1915).

Opinion

Thomas, J.:

In 1890 Frear, plaintiff, then about twenty-eight years of age, and somewhat experienced in the business of insurance, became an equal partner of the defendant Lewis, then some eighteen years of age, by purchasing a half interest in the business of Lewis’ father. The gross premiums at that time were about $17,000 for the year. In 1901 second articles of copartnership were executed by the parties, and the gross premiums, at that time $221,010.12, increased until, for the year 1908, they were $309,362.25. In 1901, and the following years, there were divided sums advancing from $12,800 in that year to $41,500 in 1907 and declining to $18,300 in 1908. I do not consider whether the money divided as profits was in full degree earned; but it is sufficient at present that the business as a whole prospered. The business was located at 145 Montague street, Brooklyn. Frear was in immediate control of the office, while Lewis devoted himself largely to matters out of the office. There were such bookkeepers and clerks as the business demanded. All the receipts were reported to the bookkeeper by Frear and then returned to him for the purpose of deposit in bank, and the checks were, with few exceptions, signed by him until about September, 1908, when some dissatisfaction [212]*212with his conduct resulted in both partners signing the checks for a short time and thereafter that service fell to Lewis alone. The earlier companies represented by the firm of Lewis & Frear seem largely to have disappeared, and usually without specific fault of the partners or either of them. The new companies acquired were largely brought in by Frear’s immediate negotiations and to some extent by his personal connections. Times came when Frear reported that the firm needed money to meet the due, and in cases overdue, premiums payable to the companies. In such exigencies Frear, who seems to have been personally neither saving nor financially resourceful, was not able to contribute in money; but Lewis at one time loaned the firm $1,000, of which sum $3,000 is unpaid, and in another instance bought the firm’s interest in some real estate owned by it for the sum of $15,000, which was paid into the company. There are some indications that Frear made tardy payment of premiums collected, whereby the business was harmed. In any case Lewis so conceived, and as he says, and as Frear denies, Lewis warned him that a dissolution would be necessary if the firm continued to lose companies. Frear seems to have had premonition of changed relations, as he suggested on two occasions such expected happening and a new partnership with clerks. On March 1, 1909, Lewis served on Frear a notice of dissolution as of that date, and repeated on March sixth notice of dissolution as of the former date. After the service of the first notice, before March sixth, Frear sought to obtain for himself alone the agency of a company then represented by the firm, but Lewis, also soliciting, obtained it for Lewis & Gendar, a new firm formed. On March sixth Frear went to his office and took from the safe papers that belonged to him personally, or to the firm, among other things checks drawn by him to the firm, and reported to the bookkeeper. Upon attempting to go out he was opposed by Lewis and some of his assistants and the papers forcibly taken from him, and the keys of the office exacted, and later the door was locked against him. For this plaintiff sought to show that he brought action and recovered a substantial verdict. It is contended by appellant that the judgment roll in the former action, not here admitted,, would prove that the firm was not dissolved on March first or [213]*213on March sixth, as that issue was proffered even by defendant and presumably decided against him. Even if it were admissible for that purpose, it is not needed. The articles of copartnership provide: “That the said copartnership shall continue until mutually dissolved in writing.” In Moss v. Elphick (L. R. [1910] 1 K. B. Div. 465; [In the Court of Appeal] Id. 846) the question arose upon a stipulation that the copartnership shall be terminated “by mutual arrangement only,” but the plaintiff attempted to dissolve it by notice. It was urged in his behalf that under the Partnership Act, 1890 (53 & 54 Vict. chap. 39, §§ 26, 32), the partnership was for “no fixed term” and that it was “for an undefined time” and could be terminated by notice of one of the partners, but that view was rejected, and it was decided that it could be dissolved only by mutual arrangement, as provided by the partnership agreement. The judgment was affirmed in the Court of Appeal. The case is authority at least so far as this: that the present partnership was not for an undefined time. But in Karrick v. Hannaman (168 U. S. 328) it was said in effect that even when the articles provide “that the partnership shall continue for a certain period, the partnership may be dissolved at any time, at the will of any partner, so far as to put an end to the partnership relation and to the authority of each partner to act for all; but rendering the paz’tner who breaks his covenant liable to an action at law for damages, as in other cases of breaches of contract.” It was further wi’itten: “In a court of equity, a partner who, after a dissolution of the partnership, carries on the business with the partner-ship property is liable, at the election of the other partner or his representative, to account for the profits thereof, subject to proper allowances.” In that case the defendant undertook, befoz'e the expiration of the partnez’ship by its tezms, to dissolve it, and excluded his copartner from any participation in the business or profits, and it was decided that, irrespective of the question whether he had dissolved the relation, he should account to the copartner for his share of the property and of the profits according to the agreement. That case is similar to the present one. But as early as April first following Lewis’ notice and seizure of the business, Frear sent out cards and letters stating [214]*214that the partnership had been dissolved. Such acts were equivalent to a written consent to the dissolution of the partnership, and it is equitable for the purposes of the accounting to regard April 1, 1909, as the date of the dissolution. Frear’s efforts were feeble and ineffective against Lewis & Gendar, who by Lewis’ strong hand had taken the office and the entire equipment and facilities by which the business of Lewis & Frear had been conducted. Whatever Frear’s shortcomings as a partner, he was ousted ruthlessly by Lewis from an office where he had a full right to be, and from books and association with customers to which he was entitled to access common to both partners. Lewis, having seized, held whatever he could for the use of Lewis & Gendar. Later, on February 16, 1910, Lewis was authorized in this action upon filing a bond for $10,000 “to continue the business of said copartnership of Lewis & Frear during the pendency of this action.” Has Lewis since that time continued the business of the copartnership or has he appropriated it to Lewis & Gendar ? Lewis says: “ I am carrying on the business in the same place, and with many of the customers, and with some of the companies.” He certainly has been aided by the property and facilities of the old firm. So Lewis cast out Frear, seized the plant, prevented a receivership, became the person to continue business and has absorbed for his new firm the business, except so far as companies and customers have fallen away.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

In re the Estate of Tannenbaum
20 A.D.2d 808 (Appellate Division of the Supreme Court of New York, 1964)
Kade v. Fireproofing & Contracting Co.
227 A.D. 622 (Appellate Division of the Supreme Court of New York, 1929)
Frear v. Lewis
170 A.D. 598 (Appellate Division of the Supreme Court of New York, 1915)

Cite This Page — Counsel Stack

Bluebook (online)
166 A.D. 210, 151 N.Y.S. 486, 1915 N.Y. App. Div. LEXIS 6531, Counsel Stack Legal Research, https://law.counselstack.com/opinion/frear-v-lewis-nyappdiv-1915.