O'Brien v. Smith

42 Kan. 49

• Court: Supreme Court of Kansas
• Decided: January 15, 1889
• Status: Published

Opinion

The opinion of the court was delivered by

Valentine, J.:

B. C. Smith, who was the plaintiff below, and is now the defendant in error, was a member of a copartnership firm of which H. J. O’Brien and E. H. Hudson, the defendants below and the pláintiffs in error, were the other members. Smith, the first-mentioned partner, sued the other two partners for services performed by him, not for the defendants, but for the partnership. Can he maintain the action? It appears from the findings of the court below that the defendants wrongfully dissolved the copartnership, and wrongfully discharged Smith as manager of the partnership affairs; but Smith does not sue for these wrongs. Whether any damages resulted to Smith or not from these wrongs is not shown, nor were the same in issue under the pleadings in the case. The plaintiff simply sued for his services rendered by him to the partnership before its dissolution and before his discharge, and for nothing else. There is no pretense that this action was for an accounting. The defendants, besides interposing their general denial, also set up in their answer an affirmative cause of action; but their claim was only for damages alleged to have resulted from the mismanagement of the plaintiff of the partnership affairs, and they did not ask for any accounting.

But returning to the plaintiff’s case: Can he maintain his action? We think not. The services rendered by him were rendered to and for the partnership, including himself as well as the defendants, and not for the defendants at all as individuals. And the services were to be paid for, not by the defendants, but by the partnership; and they were to be paid for out of the partnership funds, and only out of the profits of the business, to wit, “ one-third of all profits arising from the business, after deducting necessary expenses.” What the compensation for his services is or should be in dollars and cents no one can tell until there shall be a final accounting. If there were no profits, he is not entitled to anything for his services; and whether there were any profits or not has not been shown in this case. The defendants claim that there were none, and that there was a great loss. But even if there were profits, still, as they have never been ascertained, and as the plaintiff himself was a member of the partnership firm, he cannot maintain an action for the value of his services, nor for compensation, except in connection with some kind of proceeding by which a full accounting as between the partners and of all the partnership affairs can be had. This has not been done in the present case, nor has it been asked for by either the plaintiff or the defendants.

The judgment of the court below will be reversed, and the cause remanded for further proceedings.

All the Justices concurring.