Turner's v. Turner

Schmucker, J., delivered the opinion of the Court. The appellant corporation, as executor of the last will of the late Joshua J. Turner, filed the bill in this case against the appellees for an account of the affairs of a partnership which existed between them and the testator in his lifetime. The bill, after alleging the death of the testator leaving a last will, of which a copy is filed as an exhibit, and the qualification of the plaintiff as executor, avers that the testator and the defendants, who are his two sons, conducted the business of manufacturing and selling fertilizers as copartners from January, 1883, to February, 1888, and that at the dissolution of the firm both of the defendants were largely indebted to the testator. That the defendant Joseph J. Turner owed him on account of the partnership about $2,600, and the defendant Louis I. Turner owed him on the same account about $5,000, but there had been no ascertainment of the precise amount of such indebtedness nor any final accounting of the affairs of the firm, although all debts due by it had been paid and all debts due to it collected..

It is further alleged in the bill that after the dissolution of the firm its books and papers were left at its former place of basiness on Pratt street in Baltimore in the custody of the defendant Joseph J. Turner, who continued to conduct the fertilizer business at that place with F. A. Luchesi, the former book-keeper of the firm as his partner. That the plaintiff after the grant to it of letters testamentary made demand upon the defendants for the production of said books and papers but they did not produce them, Joseph J. Turner, in whose possession they had been left asserting that they had been lost ²⁵ and could not be found. That the defendant Louis I. Turner had produced out of his possession and permitted the plaintiff to inspect and copy, original trial balances and balance sheets of the firm’s business down to December 31st, 1887, made by F. A. Luchesi, its book-keeper, which showed that at that time Joseph J. Turner was indebted to the firm to the extent of $23,900 or thereabout and Louis I. Turner was indebted to it to the extent of $4,900 or thereabout. The copies made by the plaintiff of the trial balances and balance sheets are filed as exhibits with the bill.

The prayer of the bill is for an account and for further relief, and certain interrogatories addressed to the defendants were appended to it. The bill was not verified nor did it call for answers under oath to it or to the interrogatories. The following clause appears in the will of the late Joshua J. Turner, the appellant’s testator: “Such sums of money as my said sons or the husbands of my said daughters may owe to me are to constitute a part of the principal of my estate and no payments are to be made to either of my sons, or to my daughters or either of them until my said sons and my said daughters husbands shall have fully paid and satisfied the same.” Both of the defendants answered the bill and the interrogatories. In their answers they admit that the partnership existed between them and their father for the greater portion of the time mentioned in the bill, and that at its dissolution its books and papers were left in the Pratt street office which thereafter remained in the possession and occupancy of the defendant Joseph J. Turner and his partner, F. A. Luchesi.

Joseph J. Turner also admits that demand was made upon him by the plaintiff for the books and that he failed to produce them, asserting that he had not seen them for more than a year and did not know where they were. Both defendants deny that the trial balances and balance sheets made by Luchesi show the true state of the partnership accounts and they assert in a general way that at the dissolution of the firm there was a full settlement of accounts between the partners, ²⁶ but do not state what were the nature and terms of the alleged settlement. They both deny that there was anything due from them to their father at the time of his death. Both of the answers further aver that, although no written articles of copartnership were ever executed between the defendants and their father he agreed with them that the profits of the firm’s business should be equally divided between the three partners, but that each of the two sons should be entitled to draw from the business for the support of himself and his family in weekly installments the sum of $2,500 per annum, and that all losses incurred in the business, which would reduce the sons shares of the profits 'below $2,500 per annum each, should be chárged to and borne by their father.

This arrangement the defendants in their answers say was consented to by him in order to compensate them for their services in connection with the business and to continue under family control the enterprise with which' his name had for many years been identified. The answer of Joseph J. Turner also avers that in 1885 his father agreed that he might draw out of the business such sums of money in addition to $2,500 per annum as he found necessary for the support of his family and that any excess thus drawn by him over his share of the profits should also be charged to and borne by the father. Testimony was takfen by the plaintiff in support of the allegations of the bill but no witnesses were called on behalf of the defendants. B. F. Newcomer, the President; C. R. Barnett, the Vice-President, and J. W. Marshall, the Secretary of the plaintiff, all testified that at an interview, held after the death of Mr. Turner, Senior, with the defendant Louis I. Turner the latter stated to them that he was indebted to his father’s estate, on the partnership account something over $4,000, and that his brother Joseph J. Turner was indebted to it on the same account something over $20,000.

He further stated to them that he had trial balances and balance sheets of the firm in his possession which would show how the partners stood, and ²⁷ at their request he produced those for the years 1886 and 1887 and permitted them to make the copies of them which are filed with the bill as exhibits. The last of these balance sheets shows an indebtedness to the firm as of December 30th, 1887, from Joseph J. Turner of $23,906.26 and from Louis I. Turner of $4,901.33. It does not appear that Louis I. Turner when producing these trial balances and balance sheets said or suggested that either of them was in any respect inaccurate or improper but he by his conduct and declarations affirmed them and, according to Barnett’s testimony he offered to settle his indebtedness as it appeared upon them. Barnett and Marshall further testified that Louis I. Turner told them that the books of the firm which were at the old place of business on Pratt street then occupied by Joseph J. Turner and F. A. Luchesi would disclose the entire indebtedness, and that they thereupon went to the old office and asked for the books but failed to get them as after a diligent search of the building with the permission and assistance of Joseph J. Turner and Luchesi the books could not be found.

Two letters written on February 15th, 1888, by Louis I. Turner the one to his sister, Mrs. Helen Keiley; and the other to his sister, Mrs. Lillie Munson, were also put in evidence. The material portions of these letters are as follows: “Baltimore, Md., February 15, 1888. “My Dear Helen:—I suppose you see by today’s ‘Sun’ and ‘American,’ the ‘Sun’ I know you take, the announcement of Pa’s withdrawal from business, and the formation of a new firm by J. J. Turner, Jr., and I7red. A. Luchesi, under the old firm name as the successors, etc., of Pa * * * *. I have not, as you probably know, been at the store for a year, but continued all the time a member of the firm ever since I discovered that the book-keeper and Joe were desirous of getting together, with, of course, the intention of using Pa’s capital, etc. * * * I deem it my duty to write to you, being my sister, and having both a legal and moral right to know of such matters, and inform you of exactly the state of affairs looked at from a financial standpoint, as you no doubt know the principal cause of all the trouble has been my protest against Joe’s continued overdrawing at the store, my indebtedness to Pa, in consequence of losses, which we ²⁸ all had to bear is on January 1, 1888, $4,901.33, which I hope some of these days to repay in full.

J. J. T., Jr., total indebtedness is to January 1, 1888, $23,906.26, together with $2,700, which he realized upon 25 shares of German-American Bank stock, about which you know I have no comments to make. * * * I am, yours as ever, L. I. Turner.” “Baltimore, Feb. 15th, ’88. “My Dear Lillie.—You will see by enclosed slips from the Balto. ‘Sun’ of today of Pa’s withdrawal from business artd the formation of a new firm as the successor of the old by J. J. T., Jr., and Fred. A. Lucchesi: * * * I deem it my duty to acquaint you of matters as you have both a moral and legal right to know. * * * “The financial facts as taken from our balance sheet of the business Jan. 1st, 1888, I give below. I am indebted to Pa, in consequence of losses which were made in ’86 and ’87 of which of course I had to bear my proportion is $4,901.33 which I hope some day to repay. J. J. T. Jr.’s indebtedness is $23,906.26 besides $2,700 which he received from the sale of 25 shares of German-American Bank stock about which you know.

His indebtedness to Pa from the former business with (Keily & Co.) is about $8,000. I make no comments I simply state facts which you can take as you please. I state them because I believe you should know them. * * * Yours as ever, L. I Turner.” Marshall, the secretary of the plaintiff, also testified that he told the defendant Joseph J. Turner that he was shown to be indebted to his father by the balance sheets prepared by Luchesi whereupon Turner replied “that if they were in the hand-writing of Luchesi they must be correct because Luchesi always knew what he was doing.” The defendants were called by the plaintiff as witnesses and interrogated as to the fact of the partnership and the persons who composed it and the whereabouts of its books and papers and they both testified in substance that the books and papers had disappeared and could not be found. Joseph J. Turner also testified that he had never seen a balance sheet of the business and could not say whether of not it had been profitable as he attended to the manufacturing branch of it.

A decree for an accounting was passed in the case on January 28th, 1902, and the plaintiff called F. A. Luchesi as a ²⁹ witness before the auditor. He identified the trial balances and balance sheets as the original ones which he had prepared while book-keeper of the firm and testified that the trial balances had been taken' by him on or about their several dates from the books of the firm and that the balance sheets were made out from the trial balances and that they correctly showed the state of accounts between the partners as they appeared upon the books of the firm. He also testified that Joseph J. Turner was charged on the ledger of the firm with an indebtedness of $23,906.26 and Louis I. Turner was charged thereon with an indebtedness of $4,901.33, being the same amounts which appeared to be due to the firm by them respectively on the balance sheet of December 31st, 1887. Luchesi further testified that the books were kept upon the theory that the losses were to be borne in equal proportions by the three partners and that if an operative and binding partnership agreement existed providing for a different distribution of the losses the books and balance sheets would not show the true state of the .accounts.

Fie also said that Mr. Turner senior told him that he never expected his sons to pay him what they owed him and that in 1885 or 1886 he exhibited to the witness an unexecuted paper purporting to be an agreement between him and his two sons providing that the sons should each receive $2,500 per annum from the business without any liability on their part for its losses. That after the witness was shown this paper he asked Mr. Turner senior in reference to the matter and how he should thereafter make