White v. Joyce - 158 U.S. 128 (1895)
U.S. Supreme Court
White v. Joyce, 158 U.S. 128 (1895)
White v. Joyce
Argued December 4-5, 1894
Decided May 6, 1895
158 U.S. 128
A bill in equity against the administratrix of a deceased partner in a firm, which was dissolved in the lifetime of the deceased, is the proper remedy for the surviving partner, seeking a settlement in the courts of the District of Columbia, and alleging that, on making it, a sum would be found due to him, and when it is further alleged that part of the assets is real estate standing in the name of the deceased, the widow and children of the deceased are proper parties defendant.
A bill filed later by the same surviving partner, and called a supplemental bill, alleging that after a decree had been entered ordering the sale of the real estate, the trustees appointed to effect the sale had been unable to sell it, and further alleging that the deceased had died seised and possessed of certain real estate, and asking that a decree should be made ordering its sale, is not a supplemental bill, but is essentially a new proceeding under the Maryland laws in force at the time when the District of Columbia was ceded to the United States, in which proceeding it was competent for the heirs to plead the statute of limitations, and in which it was the duty of the court to give to the minor children, defendants, coming into court and submitting their rights to its protection, the benefit of that statute; but the widow and the adult son, who had been guilty of laches, must be left by the court in the position in which they had placed themselves.
On November 29, 1871, Andrew J. Joyce filed his bill of complaint in the Supreme Court of the District of Columbia against Mary White, administratrix of Patrick White, deceased, and Francis P. White, Mary S. White, James R. White, Lewis C. White, and Charles A. White, infants, and Mary White, widow of the said Patrick White, stating that the complainant and the defendants were residents of the District of Columbia; that Patrick White died intestate in March, 1871, leaving his widow, Mary White, and the said infants, his heirs at law, and leaving also another son, Robert E. White, who had since died unmarried and without issue, and that Mary White was appointed administratrix of Patrick
White. The complainant averred that on or about June 1, 1858, he and Patrick White formed a partnership in the grocery business in the City of Washington, in pursuance of a written agreement entered into between them on that day (a copy of the same being filed with the bill), which was to continue for seven years. It was agreed between the partners, the bill alleged, that Patrick White was to keep the books of the firm; that the firm name should be P. White & Co.; that the capital should be $3,000, to be paid in by the partners in equal portions; that, as the complainant was engaged in other business, he should employ a competent person to represent him in the business of the said firm; that Patrick White should have entire charge of the business, keep proper accounts, and sign all checks, drafts, and notes having relation to the partnership business, and none others; that Patrick White should give a full statement and account of the business, and make a settlement with the complainant whenever required so to do. It was alleged that the partners further agreed, as appeared by an instrument of writing filed with the bill, that neither member of the firm should endorse any note, or sign any bond, mortgage, or other instrument by which either might become liable for the payment of any money.
The bill alleged that the partnership commenced on June 1, 1858, and that the complainant, with the consent of Patrick White, employed John J. Joyce to represent him in the business, and fully complied with all the said agreements; that after the expiration of the said seven years, the partnership was continued for a further term of five years by an agreement in writing which was filed with the bill; that the partnership terminated on June 1, 1870, except as to a settlement of the partnership affairs; that during the time the business was carried on, no settlement thereof was ever made, or account thereof stated; that Patrick White undertook within that time to state such an account, but died before it was completed; that during the lifetime of Patrick White, and with his consent, the complainant employed two competent bookkeepers to make a statement of the effects and transactions of
the firm for the use of the partners, but that, owing to the death of Patrick White, they were compelled to cease their work. The complainant stated that he had in his possession at the time of the filing of his bill of complaint a number of the books and papers of the partnership, which had been delivered to him by Mary White since the death of her husband, and he prayed that she might be required to produce, with her answer in the cause, all other books and papers of the firm which might be in her possession. He further stated that he was informed and believed that the partnership was indebted to various persons, but did not know who any of them were, except one firm in Philadelphia.
The complainant then showed that Patrick White had purchased a certain parcel of land in the City of Washington to secure a debt due the firm, and that afterwards he and his wife, Mary White, executed a deed of one undivided moiety of the said land to the complainant, his heirs and assigns, and that in January, 1869, a debtor of the firm, on account of his indebtedness, conveyed to the complainant and Patrick White (trading as P. White & Co.), as tenants in common, a certain other parcel of land in the said city. He stated that the said real estate was part of the assets of the partnership, and should be sold to pay the firm's debts. He averred that since the death of Patrick White, he had collected the sum of $1,000 due to the partnership, for which he was ready to account, and stated that he would endeavor to collect all other debts due to the same. He prayed that the defendant Mary White Might discover if she had collected any debts due to the firm, and, if so, from whom collected, and the amounts thereof. Finally, the complainant alleged that the said real estate, of one undivided moiety of which Patrick White died seised, was not susceptible of partition among the heirs at law of Patrick White, and that it would be to the interest and advantage of the complainant and the defendants that the same be sold, and the proceeds thereof first applied to the payment of the partnership debts, and the balance, if any, distributed among the parties to the cause.
The complainant prayed that the cause might be referred
to the auditor of the court to state an account of all the effects and transactions of the firm; that the complainant might have the right to surcharge and falsify, if need be, the books, accounts, and vouchers of the business; that the complainant might have paid to him any money found to be due to him; that an account might be taken from the commencement to the end of the partnership; that the auditor might have power to advertise for all creditors of the firm to appear before him and prove their claims, and that the complainant might have the right to deny and plead to the same; that the said real estate might be sold, and the proceeds thereof applied to the payment of the partnership debts, and that after the payment thereof, any of the proceeds remaining might be distributed among the parties to the cause according to their respective rights, and that on a final settlement of the partnership account, the complainant might have whatever should be found to be due to him charged against the estate of Patrick White.
On December 23, 1871, the court appointed James White guardian ad litem of the infant defendants, and he filed an answer on January 5, 1872, signed by himself in person, submitting the rights of the infants to the protection of the court and stating that he could not admit or deny the allegations of the bill.
On January 3, 1872, R. T. Merrick, Esq., entered his appearance for the defendants in the cause.
Mary White Filed her answer as administratrix on January 30, 1872, admitting that Patrick White died intestate, and that she was duly appointed administratrix of his personal estate, and had entered upon the duties of her office. She averred that she knew nothing of the matters set out in the bill relating to the said partnership, and that she had no books or papers of the firm in her possession, except two papers which she filed with her answer, and which she believed to be of no value. She admitted the allegations of the bill with regard to the said real estate, and that it constituted assets of the partnership, and stated that she was willing that the property should be sold, but that she did not admit that a sale of the
same was necessary for the payment of the said debts. She averred that she had not collected any debt or claim due to the firm of P. White & Co. on account of the partnership business. She stated that she did not know whether the said real estate was or was not susceptible of partition, or whether it would or would not be to the advantage of all the parties that the same be sold. As to all the matters set out in the bill of which the defendant stated herself to be in ignorance, she called upon the complainant to make proof. Finally, she prayed to have the benefit of the statute of limitations with regard to the partnership affairs which were carried on under the first agreement alleged to have been entered into by the complainant and Patrick White, by the terms of which the partnership existing thereunder terminated on June 1, 1865.
Issue was joined on February 20, 1872, and the court entered an order on May 7, 1872, with the consent of the solicitors for Mary White and for the guardian ad litem, referring the cause to the auditor to state an account of the property and transactions of the partnership, and an account of what might be found to have been due from one partner to the other at the dissolution of the partnership which existed from June 1, 1865, to June 1870, reserving to the defendants the benefit of the statute of limitations, if the plea thereof should be valid in the premises as a defense. It was ordered that the auditor advertise for the creditors of the firm to appear before him and prove their claims; that the right be reserved to the defendants and the complainant to deny the same, or plead to them; that the auditor state an account of all debts and claims against the partnership; that he have leave to employ such competent persons as might be agreed upon by the parties to the cause to assist him; that the complainant have the right to surcharge and falsify, if need be, the books, accounts, etc., kept by Patrick White, and that the auditor take the depositions of all witnesses produced before him in reference to the partnership affairs, and file such depositions with his report.
By consent of the solicitors for the defendants, John F. Hanna and Thomas J. Myers were on July 9, 1872, appointed
special auditors to assist the auditor in the cause, and to take testimony, and afterwards, on December 5, 1873, by consent as aforesaid, John F. Riley was substituted in the place of John F. Hanna, who was absent from the city. The special auditors proceeded to examine the books, vouchers, etc., of the partnership, and to take testimony, and on June 18, 1875, their report was filed, signed (the solicitors for defendants consenting) by John F. Hanna as special auditor, and by Walter S. Cox, auditor of the court. They report showed that the estate of Patrick White was indebted to the complainant in the sum of $1,937.90, with interest from June 1, 1870, and to Robert White, a brother of Patrick White, in the sum of 294.23. It further appeared thereby that there was due to the said firm from the firm of Joyce & Fisher, one of the members of which was the aforesaid John J. Joyce, the sum of $1,789.18 on notes, and the sum of $199.88 upon open account.
The cause was heard upon bill, answers, exhibits, proofs, and auditors' report, and a decree, consented to by the solicitors for defendants, was entered on September 9, 1875, confirming the said report, and adjudging that Mary White, administratrix, was indebted to the complainant and to Robert White in the amounts aforesaid. It was decreed that, it appearing to the court that there were not sufficient assets to pay the complaint and Robert White, the partnership real estate be sold.
On July 12, 1876, the complainant filed a petition setting out that after the ratification of the auditors' report, it had been found that a payment of $1,523.25, made to the firm of P. White & Co. by John J. Joyce, had not been credited to him; that this error could not have been discovered from the books alone, but was made to appear by explanations of certain items, and that the auditors had since become satisfied that in justice to the estate of John J. Joyce, deceased, this error and others should be corrected. The complainant prayed that the order confirming the report might be set aside, and the cause again be referred to the auditors, with proper directions.
The report was vacated on July 12, 1876, and the cause sent
back to the auditors, with directions to restate the account and to make such corrections therein as might be necessary. The alleged error pointed out in the petition was corrected in a second report filed by the auditors on February 13, 1877, which showed that the amount due from the estate of Patrick White to the complainant was $2,706.98, with interest from June 1, 1870. A decree ratifying the second report and again directing a sale of the partnership real estate was entered on May 29, 1877, by consent of the defendants' solicitors.
On motion of the complainant and with the consent of the solicitors for the defendants, leave was granted him on May 24, 1882, to file a supplemental and amended bill. A bill styled by him a "supplemental bill" was filed on the same day in which he set out the proceedings above mentioned and stated that since the time of filing of the original bill, one of the defendants, who was at that time an infant, had reached the age of twenty-one years. The complainant averred that the trustees appointed to sell the said real estate had, after advertising a sale and taking due steps to effect the same, been unable to get a bid for either of the pieces of property. He stated that one of the said parcels was purchased by Patrick White for the sum of $572.72 at a sale made in pursuance of a decree entered in a suit brought by the firm against one of its debtors, and that the other parcel had been conveyed to the partners by another debtor in payment of a debt of about $800. The complainant then set out the descriptions of five certain parcels or lots of land in the City of Washington of which Patrick White died seised. He alleged that Patrick White died intestate, leaving the said Mary White as his widow and the other defendants as his only heirs at law, that Patrick White did not leave sufficient personal estate to pay all debts and claims against him, that on September 24, 1872, Mary White filed her account as administratrix showing that, after paying all the debts filed against the said estate, there was left the sum of $1,321.96; that this amount was distributed by the court to Mary White as the widow of Patrick White and as the guardian of her infant children, and had all been expended in the education of her children and in supporting herself and
them, and that at the time of the said distribution, the complainant's claim against Patrick White's estate had not been ascertained by a decree of the court. The complainant prayed that Mary White, as administratrix, and in her own right, might answer the supplemental bill; that a guardian ad litem might be appointed for the infant defendants; that the said real estate of which Patrick White died seised, or as much thereof as might be necessary to pay the complainant the amount due him, might be sold.
Andrew J. Joyce died on June 8, 1882. His death was suggested to the court on the 22d of that month, and upon motion of his executrix and executor, Frances M. Joyce and William J. Miller, they were on that day made parties complainant, and the cause was revived in their name.
Mary White was appointed guardian ad litem of the infant defendants on July 5, 1882, and as such filed her answer in person on the twelfth of the same month, giving a statement of the ages of the said infants, by which it appeared that one of them was under fourteen years of age, and the others above that age; that the defendants were the only heirs at law of Patrick White; that the trustees appointed to sell the said partnership property had attempted and failed to do so; that the prices paid for the property by the firm were as stated in the supplemental bill; that Patrick White died seised of the real estate described in the supplemental bill; that he did not leave sufficient personal estate to pay all the debts and claims against the same, and submitting the rights of the infant defendants to the protection of the court. On the same day, she filed her answer as a defendant in the supplemental bill, admitting the matters and things therein set forth to be substantially true.
The court entered a decree on the same day, September 12, 1882, directing that the said five parcels of land of which Patrick White died seised be sold, appointing trustees to make the sale, and providing for the manner of advertising the same, etc.
On August 9, 1883, Mary White filed a petition alleging that the auditors, in their amended report, had failed to
charge John J. Joyce, of the firm of Joyce & Fisher, formerly the representative of Andrew J. Joyce in the firm of P. White & Co., with the sum of $1,789.18 due on notes of Joyce & Fisher which had been given by the latter firm for the stock and goodwill of the firm of P. White & Co., and the sum of $199.88 due on open account, and that the auditors had made certain other errors, specifically referred to in the petition, whereby the defendants were greatly injured. She therefore prayed to have the decree confirming the second auditors' report set aside and the cause referred to the auditor of the court to state an account of the partnership affairs, and that the special auditors might be required to file all the partnership books and papers in their possession with the clerk of the court.
The complainants filed their answer to this petition on December 14, 1883, admitting that the Joyce & Fisher notes, and the open account of that firm, were in favor of the firm of P. White & Co., but averring, on information and belief and from reference to certain exhibits filed with the answer, that the sum of $731.38 had been collected from the estate of John J. Joyce. They also answered the allegations of the petition with regard to other alleged errors in the second auditors' report, and stated that they should not be surprised to find that errors in favor of and against Andrew J. Joyce had been committed in making the auditors' account, since they believed that to make up a true account from the books, papers, and vouchers of the partnership would be impossible, and that if the second report should be set aside, it should be upon certain terms, stated in the answer, among which was that the pleas of the statute of limitations should be overruled, as such pleas were abandoned at the hearing of the cause, although such fact was not embodied in the decrees confirming the auditors' reports.
The petition was, on August 2, 1884, dismissed.
On April 8, 1884, Ann Joyce, the widow of John J. Joyce, and Mary A. Joyce, Catherine Joyce, Philomena Joyce, Fannie Joyce, Monica Joyce, and Joseph I. Joyce, the adult children of John J. Joyce and Ann Joyce, filed an intervening
petition stating that John J. Joyce died on May 12, 1871, leaving surviving him, as next of kin and heirs at law, the petitioners, and alleging that during the lifetime of John J. Joyce, he was engaged in the grocery business in the City of Washington with Andrew J. Joyce and Patrick White; that about the year 1858 he was engaged in the said business with Patrick White, under the firm name of P. White & Co.; that, being indebted to Andrew J. Joyce, it was agreed that the latter should take his place in the firm until his indebtedness should be paid; that for this purpose Andrew J. Joyce became a member of the said firm in his place; that while the business continued, it was managed and controlled by Patrick White and John J. Joyce, and the profits thereof were appropriated by them to their use, and not by Andrew J. Joyce, he being only nominally connected with the firm for the purposes aforesaid. The petitioners showed that Andrew J. Joyce left a will providing, among other things, that all his interest in the said firm, after deducting therefrom the sum of $800, being the amount of the said debt due by John J. Joyce to Andrew J. Joyce at the time the latter became nominally a partner in the said firm, should become the property of John J. Joyce. It was alleged that the reason for the bequest was that the interest of Andrew J. Joyce in the said firm really belonged to John J. Joyce. The will was filed with the petitioner as an exhibit, as was also an instrument of writing executed on April 8, 1884, referred to in the petition, whereby Andrew J. Joyce made the same disposition of his interest in the firm as was afterwards made in his will, subject to the said deduction of $800. The petitioners further showed that the cause was referred to special auditors, and that the auditors found that a large amount of money was due to Andrew J. Joyce; that, for the reason that certain errors had been discovered in the auditors' report, the report was set aside and further proceedings were directed to be had for the purpose of correcting the same, and also that another auditor was substituted in the place of one of the auditors who made the report; that the auditors subsequently appointed had found, and were about to award, that Patrick White was not indebted to Andrew J. Joyce at the time of the dissolution of the partnership of P. White & Co. in an amount exceeding the indebtedness of John J. Joyce to Andrew J. Joyce, as aforesaid, and that therefore if such award should be confirmed, and the court should decree that Patrick White was not indebted
to Andrew J. Joyce, such decree would, as the petitioners believed, be a bar to any recovery by the representatives of John J. Joyce against the estate of Andrew J. Joyce for any interest which John J. Joyce owned in his lifetime in the firm of P. White & Co.; that the petitioners were interested in the question of the amount which might be found due in the accounting in the cause, and that a complete determination of the controversy could not be had without their having the right to be heard.
The court entered an order on April 15, 1884, permitting the petitioners to intervene as complainants and referring the cause to the auditor of the court to further state the account between the parties, and to take further testimony.
On April 18, 1884, Joseph I. Joyce, administrator of John J. Joyce deceased, and Ann Joyce, and Mary A. Rodriguez, Catherine Fisher, Philomena Joyce, Fannie Joyce, Monica Joyce, and Joseph I. Joyce filed an intervening petition in which was repeated the allegations of the said petition of Ann Joyce and others, filed on April 8, 1884. Leave to withdraw, amend, and refile this petition was granted on May 2, 1884. The petitioners were made parties complainant in the cause on May 13, 1884.
On June 13, 1884, an order was entered restraining further proceedings under the decree of September 12, 1882, and on the same day the defendants in the original and supplemental bills, upon leave granted by the court, filed a bill of review. Therein they stated that Mary S. White had become of age since September, 1882, and that James R. White, Lewis C. White, Charles A. White, and Francis P. White were yet infants, and set out the proceedings theretofore had substantially as they appear above. They alleged that there was error in the decree of September 12, 1882, entered in pursuance of the prayers of the supplemental bill, for the reasons that
the original bill was brought to settle the affairs of the partnership, and did not allege that Andrew J. Joyce was the creditor of Patrick J. White; that the infant children of Patrick White were not necessary or proper parties to the original bill, and could not be bound by proceedings had thereon; that inasmuch as the orders and decrees in the original proceeding were almost all entered by consent, the infants could not be bound thereby even if they were proper parties; that the auditors' reports showed that there was a large amount of assets belonging to the firm of P. White & Co., and that the trustees appointed to dispose of the assets had never reported to the court what disposition, if any, had been made of the same, or what application had been made of the proceeds; that the indebtedness found by the decree of May 29, 1877, was against Mary White as administratrix of Patrick White, and against his personal estate only, and could not establish the claim against Mary White and the said infants as the widow and heirs at law of Patrick White; that the so-called supplemental bill was an entirely new cause, and of a different nature from the original cause, being brought by a creditor of a deceased debtor against his heirs, infants and adults, to subject his real estate to the debt claimed to be due; that, the proceeding by supplemental bill thus being an original action, the complainant therein was bound to prove his claim as against the defendants, and that the proceedings in the suit against the administratrix, including the auditors' reports, were without effect, and could not properly be used as against the defendants in the supplemental bill, though in fact they were so used, and no proof was made by the complainant in that bill; that the court appointed a guardian ad litem for the infants without its anywhere appearing that they had nominated, or declined to nominate, a guardian, although the record showed them to be over fourteen years of age; that the order appointing the guardian ad litem did not recite on whose motion it was made, and was in the handwriting of the solicitor of the complainant in the supplemental bill, and that the answer of the guardian at litem, which was also in the handwriting of the complainants' solicitor, admitted all the allegations
of the supplemental bill; that the decree founded upon the supplemental bill purported to be entered by consent of the solicitor of the defendants therein, whereas the record did not show that they appeared by solicitor; that the infants could not be bound by the consent of a guardian ad litem or solicitor; that the decree was absolute, and did not give the infants a day after they should become of age to show cause against the same; that one of the defendants in the supplemental bill had since become of age, and, by the bill of review, showed cause why the said decree should be reversed and set aside; that it appeared from proceedings had since the entering of the said decree that the administrator of John J. Joyce was the real party complainant, and that John J. Joyce, as a partner in the firm of Joyce & Fisher, was indebted to the firm of P. White & Co. in the sum of $1,537.99, with interest from June 1, 1870, and also in the sum of $163, with interest from June 1, 1870, which sums were among the uncollected assets of the firm of P. White & Co., one-half of which should be applied to the payment of any indebtedness of Patrick White before his real estate should be sold to pay debts alleged to be due to John J. Joyce or his administrator; that the record in the case since the entry of the decree founded upon the supplemental bill presented new facts in the case, and brought in new complainants, against whom the defendants (complainants in the bill of review) had a good defense; that, since the entry of the said decree, errors had been discovered in the auditor's account injurious to the estate of Patrick White. The complainants prayed that the decree of September 12, 1882, might be set aside.
Frances M. Joyce and William J. Miller, executrix and executor, filed their answer to the bill of review on June 13, 1884. They referred at some length to matters set out in the bill of review bearing upon the correctness of certain items of the auditor's report, and relating to the state of the accounts between the parties, and in reference to the grounds upon which the complainants asked the court to treat the decree of September 12, 1882, as erroneous, the respondents denied that the complainants in the bill of review were improperly joined
as defendants in the original bill; admitted that the supplemental bill was filed as a creditor's bill by a creditor of a deceased debtor against his heirs, both adults and infants, to subject the deceased debtor's real estate to the payment of his indebtedness, and that the supplemental bill was filed on the alleged ground that the deceased debtor did not leave a sufficiency of personal assets to pay his debts; averred that the indebtedness of the deceased was found by a decree of the court in the cause, and was proved by the supplemental bill and by the sworn answers of the adult defendants, Mary White and Francis P. White, and the sworn answer of the infant defendants through Mary White, their guardian ad litem, and by the administratrix of Patrick White's estate; admitted that the decree appointing Mary White guardian ad litem did not show on whose motion the appointment was made, and that it did not show that the infant defendants nominated, or declined to nominate, a guardian, and that it was in the handwriting of the solicitor for the complainants in the supplemental bill, and admitted that the decree of September 12, 1882, was absolute, and did not give a future day in court to such of the defendants as were infants, and stated that they were advised that in such a case a decree is never given to infant defendants when they shall have become of age to show cause against the decree.
Joseph I. Joyce, administrator, and Ann Joyce and others, demurred to the bill of review, and, the demurrer having been overruled, they appealed to the said court in general term. Afterwards, on April 28, 1886, Joseph I. Joyce, administrator, filed an answer adopting the answer of Frances M. Joyce and William J. Miller as his own.
Testimony was taken with relation to allegations of the bill of review concerning various items of account, etc., and the cause coming on to be heard upon the bill of review, answers, and proceedings thereon, a decree was entered on November 22, 1888, whereby the said decree of September 12, 1882, was reversed. The defendants in the bill of review took an appeal to the said court in general term, where, on December 2, 1890, the said decree of reversal entered in special term was set aside
and the bill of review dismissed. Thereupon the complainants (defendants in the original proceedings) appealed to this Court.