Volume 196 — Maryland Reports

<italic>Partnership — Witnesses — Transactions with Deceased — In Action</italic><italic>by Administratrix of Deceased Partner against Survivor, Latter's</italic><italic>Testimony as to Transactions with Deceased, Properly Excluded —</italic><italic>Property of Partnership — Property in Name of Partner as</italic><italic>Constituting — Use of Partnership Funds in Purchase Is Strong</italic><italic>Evidence — But Intent of Partners Controlling, as Shown by</italic><italic>Circumstances Surrounding Purchase, and Conduct of Parties toward</italic><italic>Property Thereafter — Evidence Justified Finding, Insurance</italic><italic>Policy Was Separate Property of Deceased Partner, though Premiums</italic> <italic>Paid for Time with Partnership Funds</italic>. In action in assumpsit by widow and administratrix of deceased partner against surviving partner for the balance, equal in amount to the proceeds of a certain life insurance policy on deceased's life which had been paid to plaintiff as beneficiary, due on account of plaintiff's intestate's interest in the partnership, withheld by defendant pursuant to a purported agreement between the partners, under the terms of which the proceeds of life insurance policies which the partners might agree to buy were to be made payable to the respective partner's personal representative, and the premiums payable out of partnership funds, the proceeds to be credited against amounts due such personal representative for the interest of deceased partner in the partnership, <italic>held</italic> the trial court, under Code (1939) Art. 35, § 3, properly refused to permit defendant to testify as to transactions with deceased. pp. 447-448 The use of partnership funds for the purchase of property is strong, but by no means conclusive, evidence tending to show that the partners considered the property as belonging to the partnership. p. 448<page_number>Page 444</page_number> The criterion for determining whether property held in the name of one partner is to be considered as partnership property is the intention of the partners to devote it to partnership purposes at the time the property was acquired, as shown by the facts and circumstances surrounding the transaction of purchase, considered in connection with the conduct of the parties toward the property after the purchase. p. 448 In action of assumpsit by widow and administratrix of deceased partner against surviving partner for a sum withheld from the admitted value of deceased's interest in the partnership as paid by defendant to plaintiff, equal to the proceeds of a certain life insurance policy which had been paid to the widow as beneficiary, purportedly pursuant to an agreement between deceased and defendant under which any partnership life insurance taken out by the partners was to be payable to their respective personal representatives and was to constitute a part of the payment made to such personal representative in respect of the interest of his decedent in the partnership, and the premiums on such insurance were to be paid out of partnership funds, <italic>held,</italic> the following four evidentiary factors, <italic>inter alia,</italic> sustained the conclusion of the trial court, sitting without a jury, that the partners intended the policy to belong to deceased individually, and not to the partnership, and therefore sustained its judgment for plaintiff: (1) fact that at the date of the policy there was no written agreement in existence providing for partnership life insurance, though a prior partnership agreement had contained the terms of the contract contended for by defendant; (2) the firm accountant was never instructed as to how to charge the premiums on the firm's books, but had charged them to the partnership account on his own initiative until objection by the Bureau of Internal Revenue, upon the occurrence of which event, the partners at once without comment instructed him to charge the premiums on their policies to their respective accounts; (3) the policies were never carried as assets on the books of the firm; (4) the policy herein<page_number>Page 445</page_number> in question was kept not with the partnership assets but at the home of deceased. pp. 449-450 M.C.P., Jr. <italic>Decided December 7, 1950</italic>.