Tregea v. Mills

72 P. 578, 11 Wyo. 438, 1903 Wyo. LEXIS 17

• Court: Wyoming Supreme Court
• Decided: May 25, 1903
• Status: Published

Opinions

Corn, Chief Justice.

This suit was brought by plaintiffs in error to wind up the affairs of the partnership of E..S. Bisbing & Co. by the sale of eight hundred acres of land in Uinta County, in this State, which is alleged in the petition to be the property, and the only property, of the firm. The defendant in his answer denied that the land was partnership property. The evidence showed, among other things, that the title of record to one tract of one hundred and sixty acres of the land was in E. S. Bisbing, to another of three hundred and twenty acres in plaintiff in error, Tregea, and to the remaining tract, of three hundred and twenty acres, in defendant in error, Mills. The court heard the evidence, found that Mills was the sole owner of the tract held in his name, that the plaintiffs had no interest therein, set aside a sale of the land made by a receiver appointed during the pendency of the action and gave judgment in favor of' the defendant for costs.

A number of questions are discussed in the briefs of counsel, but we think it is apparent that if plaintiffs have failed to show by a preponderance of the evidence that the land was partnership property, there is an end of the case and plaintiffs cannot succeed in their action. It is primarily necessary, therefore, to consider the evidence bearing upon this question.

The evidence shows, and it is conceded by all parties, that Mills and Tregea, being sons-in-law of Bisbing, a partnership was formed between the three, about the year 1879 or 1880, for the purpose of ranching and stock raising. Their ranch was near Bear Lake, Utah. Tregea and Mills held title as tenants in common to a part of the land and Bisbing held title to the remainder, but it is conceded that it was all the property of the partnership. The contract of partnership was never reduced to writing, but the arrangement was entirely verbal. While this partnership, as admitted by all the parties, was still in existence, they acquired the eight hundred acres of land in Wyoming which is involved in this suit. Bisbing entered one hundred and sixty acres as a homestead, and Tregea and Mills each entered three hundred and twenty acres as desert land, and they each subsequently obtained patents to their respective tracts. The lands are adjacent and were selected with a view of being used as one ranch, and subsequently they were enclosed by a common fence, a water right was obtained by E. S. Bisbing for the purpose of their irrigation and they were managed as one ranch, Bisbing conducting the business. In December, 1892, the Bear Rake land was sold, the proceeds of the sale being equally divided between the three, and in January following a notice was published of the dissolution of the partnership. There is some disagreement as to the intention in publishing this notice of dissolution. Bisbing died in December, 1900, but Tregea and Mills both testify in regard to it. About that time Mills became involved, and Tregea testifies that he, Tregea, had nothing to do with publishing the notice, but that it was done by Bisbing and Mills, in order, as far as possible, to protect the other members of the partnership from becoming involved in Mills’ financial misfortunes, and that there was no actual dissolution. Mills, upon the other hand, testifies that while he was at the time financially embarrassed and the purpose was that his partners should not be in danger of any loss by reason of such embarrassment, yet the partnership was actually dissolved just as purported in the notice; that the Bear Lake property having been sold, there was little, if aii)q property belonging to the partnership; that during the spring he borrowed money to tide him over, by haying time he was on his feet again and that he and Bisbing met and agreed that they would again handle the Bear River land in partnership as before; that from the dissolution in January up to this time no partnership was in existence. With this exception, however, up to this point the parties are substantially agreed as to the facts.

But Tregea and -his wife and Mrs. Mills, the daughters of Mr. Bisbing, testify that the Bear River land belonged to the partnership. And Mills, upon the other hand, testifies as positively that the land itself was not, and never had been, partnership property, but that the partnership was only in the use of the land.

As tending to support plaintiff’s position that the land was the property of the partnership, are the statements of Tregea and his wife and Mrs. Mills, that such was the fact, though none of them undertake-to rehearse any conversation between the parties in which it was agreed that the land should become partnership property; and it is conceded that no such agreement was ever put in writing. Neither do they undertake to repeat any express admission by Mills that the land belonged to the firm. So that their testimony amounts to little more than that they received the impression from all the circumstances and it was their understanding that the land itself was owned in partnership. It is true the repeat a statement of Mills which they construe as an admission that it was partnership property. Their counsel had written Mills a letter demanding that he make a conveyance of the three hundred and twenty acres to which he held title. And he replied denying any partnership in the land. Mrs. Tregea states that when she saw him shortly afterwards she said to him: “How dare you deny partnership ? and he said, I had to write that to Mr. Ryckman to make a point in law. I said, you know there always was a partnership, and he said, I do not want to sell now. I said, what excuse have you for not selling? and he said he did not want to sell.” And when asked, “Pid he or not admit or deny a partnership?” she replied, “No, he did not deny a partnership to me. He made that reply to save a point in law.” Mr. Tregea states it as follows: “I asked him what he meant by writing a letter to Mr. Ryckman, my counsel, denying a partnership in the land on Bear River, and he says: ‘Frank, I don’t deny a partnership to you. I wrote that way to guard myself against points of law if the case should come into court.’ ” Th'e language of Mills’ letter replying to the letter of plaintiffs’ counsel was: “1 do not wish to dispose of any property at present. I will here say as a fact the land in question was never 'owned by any firm. It always has been my private property and I deny that any partnership regards the ownership of this land ever did or now exists.” His attention was not called to these conversations when on the witness stand and he made no denial or explanation of the language attributed to him. In a letter to Tregea and his wife, dated eight days after the date of his letter to Mr. Ryckman, and which it would seem was written prior to the conversation referred to, he says: “You write that you were amazed at my denial of a partnership in the Bear River lands. You should not be, for it is a fact that there is no legal or lawful partnership in the land in question, it never having been transferred. If it had been partnership land, neither you nor I could have mortgaged our respective pieces as we did some time back. Therefore, I could not admit any such thing to be a fact when it was not and does not exist, as the records would show. As to any arrangements between us as a family or otherwise, that is an entirely different matter and I shall carry out my part as agreed upon.”

As tending to support the plaintiffs’ case and their claim that all the land, including the three hundred and twenty acres held in the name of Mills, was owned by the partnership, is also the way in which the land was handled and the business conducted. Mr. Bisbing managed the business at all times up to his death in 1900 and, indeed, exercised substantial control of it, the other two partners being occupied in other employment. The land was enclosed by a common fence and there were no partition fences separating one tract from another. There was but one notice of claim for a water right for the entire body of land. Though this fact is of small significance, as under the laws in force at that time the lands to be reclaimed need not be designated, and in fact were not designated, in the notice. And it was signed by Bisbing personally, together with John W. Stoner and Charles Deloney, the two latter thereby making a claim for water to be applied upon land entirely unconnected with that in controversy, and Mills and Tregea being only mentioned in the notice as members of an association of the five persons who were to construct the dam. It further appears from the evidence, and it is not questioned, that, though Mills and Tregea had title to three hundred and twenty acres each and Bisbing to but one hundred and sixty acres, yet after the expenses were deducted the proceeds were divided equally among the three and not according to the acreage owned by each. This might perhaps be accounted for upon the ground that Bisbing was entitled to compensation for his personal services, though Mills does not account for it in this way, but states that it was because he was the senior member and the father of their wives and they were willing to give him the better of it.

There is also some attempt to show that the expenses of proving up on all the land was paid by the partnership and that certain sheep were sold and the money devoted to that purpose, but there is nothing very definite about the evidence on this point. Mr. Bisbing attended to making the proof for all the tracts and neither Tregea nor Mills knew much about it. But Mills testified that he paid the expense as to his tract out of his own'pocket, Having handed the money to Mr. Bisbing for the purpose'. One witness testifies that in 1882 he was working for them on the Bear Rake ranch when some sheep were sold; and that he understood from the conversation of the parties that they were in immediate need of money to prove up on the Bear River land and that the sheep were sold for that purpose. But as the proof was not made on any of the land for more than a year after this, and the witness was only about thirteen years of age at the time, knew nothing whatever as to whether the money was actually applied to that purpose or not, or, if so, how the accounts of the individual partners were adjusted with reference to it, the testimony is not of much value. And, moreover, in the absence of any evidence, as in this case, that the lands were finally paid for by the partnership, it is entirely consistent with the individual and separate ownership of them that the funds for that purpose may have originally been supplied to any one or all of the owners out of the partnership assets. The same witness and two or three others testify also that they had heard statements from the three members of the firm, in substance, that they were partners in connection with both the Bear Lake and Bear River ranches; but they heard nothing having reference to the ownership of the Bear River property itself. And this is the substance of all the evidence adduced by plaintiffs to establish the joint ownership of the lands in question.

On the other hand, there are several facts which indicate a separate ownership of the several tracts, and that such was the understanding of the members of the firm. Mrs. Tregea and Mrs. Mills, in their petition for letters of administration upon the estate of their father, set out that he owned this one hundred and sixty acres of land, and there is no intimation in the petition that his estate was actually a one-third interest in the eight hundred acres. And Mr. Tregea had knowledge of the filing of this petition and of its contents, and acted with them in employing counsel and having it filed. They explain that it was set out in this way under the advice of their counsel and to avoid the expense and delay of having the partnership affairs administered in the probate court. And there is no reason .to doubt the truth of this explanation. It nevertheless indicates very clearly that at this time, which was prior to, the refusal of Mills to join in a conveyance of the land, they had no very definite understanding that all the land actually belonged to the partnership and not to the individuals in whose names it was held.

Furthermore, it appears in evidence that in 1892, Tregea being in need of money for his own purposes, the amount was secured by a mortgage upon his tract and not upon all the land or. any other part of it. Bisbing and Mills and their wives joined in the mortgage, but not as part owners. It was with a recital that it was for the purpose of releasing and conveying any interest they might have or claim in the land by reason of the partnership existing between them and Tregea. And Mills explains that the agent, who negotiated the loan, knew of the close family and business relations between them and insisted it should be signed by the other partners, so that no complications might arise in case of a foreclosure; that this was the only reason why they signed it. In May, 1893, after the notice of dissolution was published, Mills had occasion to raise money for his own purposes and he likewise mortgaged his tract, no other part of the land being covered by the mortgage. Bis-bing and Tregea and their wives likewise joined in this mortgage with the same recital, except that the partnership was referred to as the partnership heretofore existing. These loans were subsequently paid off by Treagea and Mills, respectively ,and had no connection in any way with the partnership business.

Moreover, one George Hall, a witness for the defendant, states that, in conversation with Mr. and Mrs. Bisbing, they told him Mills had mortgaged his part of the ranch — his three hundred and twenty acres — and gave him to understand that the individual partners owned their respective tracts. Fie said to them he supposed it was partnership property, like the Bear Rake land, but they informed him that it was only fenced together to curtail expenses, and that they were partners only to that extent. Mrs. Bisbing also stated that their taxes were not as heavy as the others. John Pope, another witness for defendant, also states that Mr. Bisbing, in the presence of his wife, told him that Mills had mortgaged his land over on the river. And in reply to his question, “Have you mortgaged the ranch?” Mrs. Bisbing said: “No, he has mortgaged his own land. One hundred and sixty acres belongs to Air. Bisbing and three hundred and twenty to Mr. Tregea.” John Peters also testifies that Bisbing told him they were partners in the Bear Rake, but not in the Bear River, ranch; that each owned the part of the latter standing in his name. Pope also states that once when he was at work on the ranch Tregea pointed out to him the separate pieces owned by himself, Bisbing and Mills, respectively. Lyons, another witness fpr defendant, states that in 1883 Bisbing told him that each owned his own part of the Bear River land; that, in 1884 or 1885, Tregea spoke of selling his land; that he said that he had three hundred and twenty acres, that he could sell it, that it was his to sell.

Under this evidence, we think it is clear the plaintiffs cannot prevail in their suit. There is not only no preponderance of the evidence that the land in controversy was owned in partnership, but such preponderance is quite clearly against it. And in actions of this character the plaintiff to succeed must make out his case by something more than a mere preponderance of the evidence. It must be clearly proved. The sale of the land by the receivei could only convey the equity of the partnership and, upon the refusal, as in this case, of the holder of the legal title to convey, the purchaser must resort to some proceeding in the nature of a suit for specific performance to compel him to perfect the sale by a conveyance of the legal title. In such cases, courts of equity uniformly require that the proof shall be clear and satisfactory. (Dunn v. McGovern (Ia.), 88 N. W., 938; Wilmer v. Farris, 40 Ia., 309; Ralls v. Ralls, 82 Ill., 243; Wright v. Wright, 31 Mich., 380; Allen v. Fiske, 42 Vt., 462; Boggs v. Bodkin, 32 W. Va., 566.)

Ralls v. Ralls, supra, was in some of its features similar to the case under consideration and, in announcing their decision, the Supreme Court of Illinois say:. “Keeping in view the rule, as announced so often by this court, that, in a proceeding of this nature, the proof must be clear, we have looked into this record and fail to find proof sufficiently plain and clear to justify the conclusion that the individual lands of these parties were ever held as partnership property. It is true they were in partnership in the farming business, but the evidence that the lands were held in common is by no means satisfactory.”

Upon all the facts, we are of the opinion that a decree confirming the receiver’s sale, which would be in effect a decree requiring a conveyance of this land by the defendant, would do violence to this well'' established principle, and that the judgment of the District Court, setting aside the sale and dismissing the suit at plaintiffs’ costs, should be affirmed. Affirmed.

Knight, J., and Potter, J., concur.