Reilly v. Woolbert

¶1(1) If the allegations of the bill are true, a partnership existed between complainant and respondent from August 1, 1906, by virtue of the completed payment by complainant of the stipulated price for a one-tenth interest in respondent’s coal mining business. Such a purchase, by necessary implication, creates a partnership, with all of its legal incidents, and a contractual specification of those incidents is wholly unnecessary. .This result is, of course, only upon the face of the bill, and takes no account of the statute of frauds, which will be considered hereafter.

¶2(2) This relation, under the allegations of the bill, would entitle complainant to an accounting and settlement of the partnership business, as an independent equity, regardless of the nature of the account, whether complicated or simple. This is the primary aspect and purpose of the bill, and in this aspect it is not subject to the demurrer.

¶3(3, 4) But there is also an alternative prayer for an accounting between the parties as creditor and debtor merely, in case no partnership is shown; and this rests on the allegation that respondent’s indebtedness to complainant “is by a complicated account, consisting of numerous items of debits and credits each month for over five years.” This allegation is not sufficient to show either a complicated or a mutual account, so as to necessitate or permit the exercise of an independent chancery jurisdiction in the premises.—Chrichton v. Hayles, 176 Ala. 223, 57 South. 696; Phalin v. Dearman, 181 Ala. 320, 61 South. 941. It is not sufficient, because numerous items are not necessarily complicated, and because debits and credits do not alone constitute a mutual account. The demurrer to this aspect of the bill was well taken, and should have been sustained.

¶4(5) It does not appear upon the face of the bill that thg alleged contract of purchase was not in writing, and hence that ground of demurrer was not well taken.

¶5But as a defense to the entire bill, and to each separate part and aspect of it, respondent pleaded that the alleged agreement *194of purchase was void under the statute of frauds for wanting of a writing. This plea was held insufficient, and a partnership was held to have been created on May 1,1905, by the parol agreement.

¶6(6) Whatever the rule may be elsewhere, it must be regarded as settled in this state that a verbal agreement for the purchase of an interest in a partnership consisting wholly or partly of lands, involves the title to lands, and is violative of the statute of frauds.—Butts v. Cooper, 152 Ala. 375, 383, 44 South. 616—citing Raub v. Smith, 61 Mich. 543, 28 N. W. 676, 1 Am. St. Rep. 619, and other cases. The plea was, therefore, a good and sufficient answer to the bill as a bill to establish and settle a partnership, and the chancellor erred in holding otherwise.

¶7With a proper amendment showing facts which would render an accounting — as between debtor and creditor — too complicated and difficult for an accounting at law, or showing mutual accounts between the parties, the bill may in any event be maintained in that aspect, if supported by proof, without regard to the question of partnership.

¶8The decree of the chancellor, granting relief, will be reversed, and a decree will be here rendered, holding that the demurrer to the complaint as last amended is well taken, and is sustained as to grounds A, B, and C, and that plea 3 was sufficient as to every aspect of the bill except as for an accounting merely, and the cause will be remanded for further proceedings in accordance herewith.

¶9Reversed, rendered, and remanded.