Prentice & Johnson v. Buxton's Administrator

42 Ky. 35, 3 B. Mon. 35, 1842 Ky. LEXIS 93
CourtCourt of Appeals of Kentucky
DecidedSeptember 13, 1842
StatusPublished
Cited by2 cases

This text of 42 Ky. 35 (Prentice & Johnson v. Buxton's Administrator) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Prentice & Johnson v. Buxton's Administrator, 42 Ky. 35, 3 B. Mon. 35, 1842 Ky. LEXIS 93 (Ky. Ct. App. 1842).

Opinion

Judge Marshall

delivered the opinion of the Court.

On the 18th day of November, 1833, up to which day Prentice & Buxton had been partners in the printing establishment of the “Journal and Focus,” in Louisville, Buxton sold to John N. Johnson one half of said Journal and Focus, together with one half of the types, materials, furniture, fixtures, and stock on hand, with amoi[36]*36ety of the leasehold interest in the premises then occupied as the office of the “Journal and Focus,” for $3,000, w}j¡cjj $q.800 were paid in hand, $200 in four months, and $1,000 were to be paid in one and two years, and for securing that payment, Johnson & Prentice executed two notes of $500 each. At the same time Buxton sold the excess of his interest in the establishment, above one half, to his former partner, Prentice, at the price of $1,000, for which Prentice & Johnson executed two notes, of $500 each, payable in one and two years. By the instrument of sale, which was signed by all the above named parties, it was agreed that the debts due or to become due to the late firm of Prentice &’Buxton, should be collected under the control and direction of Prentice & Johnson, and appropriated by them inpayment of the debts due by said late firm, and remaining unpaid at the time .of the sale; and Johnson agreed to be responsible to the creditors of said late firm, for any amount of its demands collected or caused to be collected by him, which might not be paid over to its creditors, but was to be no further responsible for the debts due by it. If the debts due to said firm should be more than sufficient to discharge those due by it, the surplus was to be equally-divided between Prentice & Johnson. If they should fall short, and Prentice should, thereby, become liable for more than his proportion, the payment of his notes was to be suspended until his liability should be ascertained. The debts due to the late firm were not to be set-off against the individual debts of Prentice & Buxton, unless (as provided by a codicil to the agreement,) such individual debts were contracted for the benefit of the firm, or for necessaries for the individual partners. Prentice & Johnson agreed to provide a competent and trust-worthy clerk, who should open an account, in which Prentice & Buxton were to be credited by all sums received for dues to them, and charged with all disbursements for payment of their debts by Prentice & Johnson. And Buxton undertook that his interest in the establishment was free from lien or incumbrance. In March, 1836, Buxton having in the mean time departed this life, his administrator filed this bill, setting forth the sale and [37]*37agreement above stated, alledging that Buxton had loaned or advanced, in payment of the debts of Prentice & Buxton, the sum of $900, as mentioned in the agreement, and also $250 in addition, of which there had been no re-payment; that Prentice & Johnson had failed to provide a competent and faithful clerk, and to keep correctly the account provided for, and to proceed diligently in the collection of the debts due to Prentice & Buxton; that said debts greatly exceeded those due by said firm, and that Prentice & Johnson had collected, or should have collected an amount of the former more than sufficient to pay the latter, but averring that they had not collected, or could not collect enough to reimburse them for payments made by them in discharge of debts due from Prentice & Buxton, they had failed and refused, on that pretext, to pay the said four notes of $500 each, two of which had been assigned ; and he prays that an account may be taken, and that the advances made by Buxton, or so much as is due therefor, be decreed against the defendants.

Johnson & Prentice answered separately, denying the alledged advances, except as to the sum of $575, which they say was more than reimbursed, and denying, also, the other material allegations of the bill. They alledge that they had paid for the firm of Prentice & Buxton, a greater sum by $— than they had collected or could col. lect; that Buxton, before the sale, had kept the books unfaithfully, and they did not show truly, the debts and credits of the firm ; that he had received large amounts not entered on the books, nor appropriated to the benefit of the firm, and left charges without credits, when payments had been made ; that he had, moreover, as an inducement to the purchase by .them, represented a considerable excess in the debts due to the firm, above those due by it, which had turned out to be untrue. And that, after the sale, he had received funds of the firm, and especially notes and accounts to a large amount, for- which he had not accounted. On these grounds large sums are claimed to be chargeable against him. And Prentice, by cross bill, prayed for and obtained an injunction against the [38]*38collection of the notes given for the interest purchased by him.

The chancellor’s decree. Purchaser of a printing establishment & subseriptionandpalronage, assuming debts and undertaking the collection of the dues to the establishmant, and to pay surplus to vendor, is bound to use reasonable dilligence in making collections and disbursm’ts, and proof that any of the sums due to the establishment were lost by insolvency, &e., devolves onthepurehaser.

[38]*38By an interlocutory decree, the case was referred, to the Master, with minute directions as to the facts to be ascertained and the principles on which the accounts should be stated. And a most voluminous and detailed report having been made, the exceptions to which, taken by Prentice & Johnson, were overruled.

The Chancellor, on final hearing, being of opinion that on the account growing out of advances made by Buxton, for the benefit of the firm of Prentice & Buxton after the sale, and of receipts by him during the same period, of the funds of the said firm, there was a just balance against him of $57 50, perpetuated the injunction on Prentice’s cross bill for that sum, dissolving it for the residue, and dismissed the original bill, decreeing that the complainant should pay the costs of both bills, including $456 allowed to the Master for stating and reporting the accounts. Prentice & Johnson appealed from this decree, and Buxton’s administrator has filed cross errors in this Court.

We deem it unnecessary to notice, in detail, the numerous questions made by the errors assigned on each side, and by the exceptions taken to the Master’s report by Prentice and Johnson. These questions are, for the most part, subordinate, and such as either need not be decided at all, or will be substantially disposed of under the general view which we shall take of the rights and duties of the parties under the agreement of the 18th of November, and of the account of debts due to and from the firm of Prentice and Buxton.

By the agreement referred to, Prentice and Johnson undertook the collection of the debts due to Prentice and Buxton, and to keep a faithful account of their collections and disbursements for that firm. They were entrusted with the books and other evidences of debt in favor of the dissolved firm. They were bound to use good faith and reasonable diligence in making collections and disbursements, and making a true account thereof, and in making such entries on the books as would show any alteration in the state of the debits and credits occasioned [39]*39by their acts.

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Bluebook (online)
42 Ky. 35, 3 B. Mon. 35, 1842 Ky. LEXIS 93, Counsel Stack Legal Research, https://law.counselstack.com/opinion/prentice-johnson-v-buxtons-administrator-kyctapp-1842.