Birchett and Others v. Bolling.
Decided March 3d, 1817.
1. Specific Performance — Agreement lo Build Tavern, —An Agreement to build a Tavern in partnership, at the ioint expence and risk, and for the joint benefit, of the contracting parties, to be held by them in fee simple, decreed to be specifically performed, at the instance of a partner, who furnished the ground for the purpose, and had fully performed the Contract on his part; notwithstanding many of the partners were unwilling to carry it into effect, because, in their opinion, a change of circumstances had rendered the scheme unprofitable.
2. Chancery Practice — Uncertain Decree — Refusal of Obedience to — Attachment.—An Attachment ought not to be awarded against a party for refusing obedience to a Decree, which as yet remains genera) and uncertain, and the extent of which, as it relates to him, he cannot ascertain without applying to the Court for a farther Decree.
3. Same — Same—Reversal — A Decree ought not to be reversed for uncertainty, in matters, as to which it is only- interlocutory, and may be perfected by application to the Court.
Xu October 1807, Robert Bolling, thirteen other individuals, and five mercantile companies agreed to build on a Dot of his in Petersburg, (which he sold to the association for the purpose,) an elegant Tavern, to be called the “Columbian Hotel,” at their joint expence and risk, and for their joint benefit, the costs of the building and out houses by a rough estimate, was to be $18,000; that of the Iyot was $2000, which Bolling subscribed as his proportion of stock in the firm. The whole sum subscribed was divided into forty shares, of five hundred dollars each, to be held in fee simple by the partners; each of whom subscribed for two shares; except Bolling, who took four shares, as aforesaid. There was a House on the Dot, which he agreed to remove, in order to make way for the Hotel. A written Agreement, or Subscription Paper, to this effect, was signed by them all. Several meetings of the Subscribers took place; a majority decided, and their proceedings were signed by their president and Secretary. At their first meeting, after the agreement, they chose five of the partners Commissioners to commence the execution of the plan. At a *500subsequent meeting on'the 21st September 1808, the Commissioners were directed to proceed to erect the building.
Two of those Commissioners, John Bell and Edward Powell, having- refused to act; at another meeting, held on the 18th of *April 1810, Thomas Bennett was appointed to act as Commissioner or Trustee, with John Wilder and Robert Boll-ing; and they were authorised and directed to erect the Hotel, as soon as possible, according to a plan then approved, and to call on the share-holders for their proportions of the subscription; the expenditures were in the mean time limited to ten thousand dollars, the residue to be expended when necessary and proper. Those Commissioners proceeded accordingly to perform the trust, and made considerable progress in the work. They suspended their operations during the difficulties occurring in the foreign relations of the United States, (in which suspension Bolling acquiesced,) but resumed them, after those difficulties ceased.
Bolling complied with the Contract on his part, by removing the House to- make way for the Hotel, and conveying the Lot, in fee simple, by a Deed duly recorded, accompanied with a relinquishment of his wife’s dower. He afterwards filed his bill in the Superior Court of Chancery for the Richmond District, setting forth that John Bell, Robert Birchett, Richard E. Taylor, Edward Powell and William Cumming refused to pay their proportions of the subscription ; that William Johnson, executor of William Potts deceased, also refused to pay the subscription of his Testator out of the assets in his hands; that the other subscribers had always been willing to fulfil the Contract, and had partly paid for their shares: praying, therefore, that all the partners, who were living, and the legal representatives of those, who were dead, be made defendants to the Bill; and that the unwilling defendants be compelled to perform the Agreement on their part specifically.
The joint Answer of John Bell, Robert Birchett, Richard E. Taylor, Edward Powell, and William Cumming admitted the execution of the Subscription paper, and the proceedings at the different meetings of the partners; but denied that they ought to be bound, either by that agreement, or those proceedings: because, they averred their belief, that all the partners having repented of the bargain, in consequence of its becoming disadvantageous by the Embargo, laid by the General Government, tile defendant Richard E. Taylor proposed to the plaintiff to rescind the Contract, and accept a reasonable compensation from the subscribers: and that, after having ^'considered it, he declared, before the defendants Birchett and Wilder, that he would take $4000, as a full compensation for the Lot, and all loss and injury, he might sustain, and release the subscribers from the Contract: that Birchett assured him they would pay him that sum: that a paper to that effect was drawn and subscribed by the plaintiff, and by the defendants Birchett, Wilder and Bowden, and was to be left at the Bank to be signed by the other partners. The defendant Birchett solemnly declared, that, by that writing, the plaintiff agreed to release the subscribers from the Contract, for $4000; that he, Birchett, had not seen it since, and knew not what had become of it: the defendants Bell, Powell and Taylor had never seen it, though anxious to execute it: “they call on the Appellee to produce it, or to declare its purport if it be destroyed:” and they believed the other Subscribers would have signed it. The defendant Bell acknowledged his activity and zeal at first to promote the scheme, and his efforts, after the Embargo, to persuade the other partners to decline it, and to pay Mr. Bolling for the Lot: that he understood from the defendants Birchett and Taylor that Mr. Bolling had accepted their proposal to take a reasonable compensation and release them. He alleged that he attended their meeting, in 1810, only to withdraw his name. The defendant Birch-ett denied that the Deed for the Lot was offered to him for acceptance: the other four respondents admitted it was offered, but that they refused to have any thing to do with it.
The Answer of John Wilder admitted the statement in the Bill to be true; that he had paid part, and was ready to pay the balance of his proportion; and that the Hotel was nearly finished. He then gave a different account of what the five unwilling defendants considered a release from the Contract; alleging, that the plaintiff, at his request, agreed that a proposal to pay him $4000, for their release from the Contract, might be made to the other subscribers; and if they should unanimously agree to it, and he should, after such unanimous agreement, approve of it, he would take that sum: that the plaintiff expressly reserved to himself the right of receding from it, notwithstanding their unanimity; and never signed the writing; and that, as one of the partners refused his assent, the plaintiff, in the presence of this defendant, destroyed it. The *deposition of the same defendant was also taken, and filed, to the same effect with his answer.
Several other defendants filed their Answers, from which it appeared that some of them were willing to carry the agreement into full execution; and others were desirous of being released from it.
A deposition proved that the Deed for the Lot was offered to the unwilling defendants to execute, and they refused.
Chancellor Taylor, at February 'Term 1815, decreed in favour of Bolling; “that the surviving parties to the agreement should in all things execute and perform it, from time to time, agreeably to its true intent and meaning; that, if the personal representatives of the deceased parties should fail to pay their proportions, when requested, the plaintiff, or any other person interested, might resort to the Court, for an account of the personal assets of the deceased, or for a sale of the shares; and that, if any of the living defendants should become unable to pay their proportion, when requested, the Court might be resorted to, in like manner, to enforce the *501agreement; and that the defendants John Bell, Edward Powell, Kichard F. Taylor, Robert Birchett and William Cumming, by whose conduct this suit was produced, pay to the plaintiff the Costs thereof.”
The said defendants refused to pay, in execution of the Decree, their respective proportions of the subscription ; though a Copy was shewn them, as was proved by Affidavit. The plaintiff „ thereupon gave them notice, in writing, that he should, on the 10th of June following, move the Chancellor to attach them for disobedience.
. The service of the notice being proved, an Order was made, directing an Attachment to issue against those defendants for refusing to perform the Decree; the Chancellor “being of opinion that there was nothing in the objection, which went to the merits of the Decree, as the Agreement thereby directed to be specifically performed is not a mercantile agreement, and hence should be governed by the general law of the land, and not by those rules, which regulate mercantile Contracts ; that the objection, for the want of proof to some of the documents in the cause, not having been made at the hearing, comes too late; and that the objection *to the general terms of the Decree is not web founded, since no process for the execution thereof can issue without the leave of the Court, or of the Judge in vacation, and therefore the Court or the Judge will take care that none shall be awarded, but to enforce specifically the agreement for the association of the parties, in the Bill mentioned; and hence nothing can be required of any of them but what is required by the Agreement, which is too plain to be mistaken. ”
Prom this Order, as well as from the Decree, the defendants Birchett, Taylor and Powell appealed.
Call for the Appellants.
Any of the partners, who chose to withdraw from the association now in question, had the right to do so, and could not be compelled to remain attached to the firm. The rule is that any partner may withdraw, without cause, if the duration of the partnership be not limited; because, in that case, “tamdiu societas durat, quamdiu consensus partium integer perseverat; and for cause, where it is limited; because unforeseen events excuse performance; and because Equity will decree a dissolution for good cause shewn, and the party may do what Equity would compel. It is true that, if a partner should break ofi with some sinister view, or at an unseasonable time, which might occasion loss to the partnership, an action may be brought against him at law, in which the remaining partners may be compensated, and damages mitigated according to circumstances.
Equity ought not to decree execution of this partnership; because the law can give mere just relief, and leave the parties at liberty to pursue other avocations; because the utility of partnerships depends upon unanimity of counsels; wihch can never be had if the parties disagree; because the parties, or either of them, may determine it, when they please; and therefore Equity, which never decrees a vain thing, leaves them to the law. In this case, too, any partner may demand partition; for the articles do not stipulate that the Tavern is to be kept. Tne motives for making the proposed establishment have ceased, and if would be unconscientious to compel performance ; for circumstances have changed, and it is no longer an eligible situation, The Decree would be useless; *for the insolvency of some of the partners puts it out of the power of the rest to complete the scheme; and neither is obliged to contribute more than his stock: the Court would not decree for the insolvents ; and the rule ought to be reciprocal.
Equity will not permit one party to har-rass another. It therefore would have decreed a dissolution upon just terms, which, at most, would have been payment of the difference between the price of the share and the subscription. The conduct of the defendants was perfectly fair; and withdrawing at the time, they wished it, would have been attended with no inconvenience; for the Deed had not passed, and nothing had been done, nor any expence incurred.
The Decree too is erroneous in form ; because it is uncertain, and decides nothing; for it does not say whether any party has performed, nor whether the plan of twenty or that of ten thousand dollars shall be pursued, nor what quotas have been called for. It ought to have decreed a sale of the shares, and left the defendants liable for the difference only. An Account should have been taken by a Commissioner, to ascertain the sums due. Besides, the uncertainty of the Decree took from the defendants the benefit of the forthcoming Bond and suspension law; for it was impossible to give the Bond and Security, which the law required. •
The Order directing an Attachment was also erroneous; because, the Decree being uncertain, the defendants were not guilty of contempt; and because the plaintiff, in the notice served on the defendants, demanded interest on the sums remaining due; and the Decree had not given it.
John E. May for the Appellee.
I. 1. The authorities cited by Mr. Call are applicable to cases of general partnerships for an unlimited time; and not to special partnerships for a particular purpose, In this case, the partnership will expire with the completion of the Hotel; and the partners will then become joint tenants of the property. This was conceded in another part of Mr. Call’s argument. Even in cases of general ^partnership, however, no partner can break off with a *502sinister view, or after the business has been begun. In this case, the Appellants have acquired, since the Contract, an interest hostile to the establishment of the Hotel. The business, too, had been begun ; for the Appellee, for the purpose of commencing the new building, had removed from the Lot a House, which was producing him an annual rent.
2. A Court of Law cannot give adequate relief. If the Bill be now dismissed, the Act of Limitations would bar a recovery in a Court of Law. But a material object of the Contract was to increase the value of property in that part of the town in which the Appellee is a large land holder. Damages alone would not enable him to effect that object; unless he could recover the whole amount subscribed. Besides, there are some of the other parties, who have the same interest, and who might also claim damages. A specific performance will therefore prevent multiplicity of actions.
3. Bolling was not to blame for the delay: it was more injurious to him, than to any other person. He was losing the rent of the Lot, the former House having been removed; and he was losing the Interest of his four shares, which were paid for, while all the rest had paid 'nothing. It was the fault of the other partners, and principally of the Appellants, who postponed, in order to avoid, the execution of their Contract.
4. There is no evidence of the insolvency of any of the partners: and, until there be, the Chancellor ought not to have decreed a sale of any of the shares. «Any partner may at any time sell his share; and they cannot object that the Chancellor did not decree, that they should do what they have a right to do without a Decree.
5. Taylor’s proposition! to pay Bolling $4000, and cancel the Contract, could not be acceded to; there is no proof that it was; and Wilder’s Deposition, taken under an order of Court, is expressly contrary. And< if Bolling had been willing, some of the pther parties were not.
II. The Decree, for specific performance simply, is right in form. We did not want money merely; but the aid, influence, credit and co-operation of all the partners. The only objection presented to the Court below, by the Appellants, was, that there had been a release by Bolling, or that one was *to be inferred from the circumstances. The Court presumed from this, that it was only necessary to decide the cause against the defendants, and that the}' would with good faith perform the Contract. 2Eq. Cases Abr. 17, is a precedent of a Decree like this. But if there be error in this respect, it is injurious to the Appellee only. He, and riot the Appellants, ought to complain that they were not directed’ also to pay the amount of their shares respectively. If they wished it corrected, they might have had it done on motion ; and therefore it is no reason for appealing. 2 Eq- Ca. Abr. 279, 3 Munf. 29. Sheppard’s Executor v. Starke and wife, pi. 1.
III. The Attachment was right: the first Decree was sufficiently certain as to the payment of the $1000, which, without interest, is all that Mr. Bolling demanded. If the Appellants thought it uncertain, they might have had it explained before the Attachment was directed. If they wished to give a Suspension Bond, they should have tendered one, or offered to do so. Instead of which, all their objections to the Attachment were founded in the original Decree. But this is not a case in which a Suspension Bond could have been given. The Act of Assembly (Sess. acts 1814 — IS,) speaks of Decrees for Money. This was not a Decree for money merely, but for specific performance; and to allow a Suspension Bond would be to delay or to avoid the performance. The Legislature, when they mean to provide for cases like this, name expressly Attachments for failing to perform Decrees. Rev. co. passim.
David Robertson on the same side. The reliance of the Appellants on the release is an admission of their prior liability as parties to the agreement; and, by placing their defence on that footing, they waive every objection to the proceedings; precisely, as at law, the plea of payment admits the execution of the Bond, and that it was given for a fair consideration, without fraud or force.
Of this release no proof is produced. And, since it is asserted affirmatively, in opposition to the plaintiff’s demand, the burthen of proof is on the defendants who allege it. But not only is the release not proved by them, but it is disproved *by the testimony of Wilder. There is no ambiguity, as is' pretended, in the decretal order. It directs a specific performance of the agreement in all things;-and the agreement so referred to is too plain to be misunderstood. It plainly means that they should pay, each of them, their two shares; that is $1000. The Decree is in personam, as all Decrees were before the passage of the Act authorizing decrees in rem: but the power of decreeing in personam still subsists. Id certum est, quod certum reddi potest. If they did not know its meaning, that they were to pay $1000 each, they could have applied to the Court during the Term : they could have obtained the requisite information by motion, This case was open for the plaintiff, and consequently equally so for the defendants, if necessary for their interest. They could have obtained an explanation either during that Term, or af-terwards: but they wanted none: it is a mere pretext, to evade the real merits, and to throw, if possible, the costs on the Ap-pellee. Their subsequent conduct fully proves this. The notice, that a motion would be made to attach them for contempt, was accompanied with the copy of the Decree, and a statement of what they had to pay; the failure to do which was the ground of the motion. If they wanted information only, and were willing to obey the Decree, they could have paid, and shewn that performance in discharge of the motion. The order of the Chancellor to attach them was *503therefore correct. This principle of attaching for a contempt in not obeying a Decree is too well known to require authority to support it.
The execution of the Decree was under the control of the-Court, and could not be abused to the injury of the defendants.
But if the agreement were ambiguous, (instead of being plain as it is,) it could nevertheless be decreed to be carried into execution, An agreement to build a Bouse, though uncertain as to the time, size and value, was decreed to be specifically performed.
But, admitting the release to be unsupported, the defendants insist, that this is like an unpromising mercantile speculation, which they ought not to be compelled to join in. There is no similarity between this and such a mercantile project; *and therefore this case must be governed by the general law of the land.
A Court of Equity will decree a specific performance of a Contract or Agreement to enter into a partnership, even though relating to personalty, A fortiori, will it enforce such an agreement relating to real estate, Such an agreement ought to be certain, fair and just in all its parts. This undoubtedly is so. There is no doubt as to the intention: it is fair, and for public utility as well, as private emolument; and it is equal, and therefore just. It does not resemble the agreement, in the case of Ilercy v. Birch, 2 Ves. 629, of which the Court refused to decree specific performance, because the parties might dissolve the partnership immediately after-wards. This was a permanent partnership, and no party or number of parties could dissolve it, without the consent of all; for it respected real estate, and was not limited in point of time, The property was to be held in fee simple; and all the partners are tenants in common, In the case of Bake v. Craddock, 3 P. Wms. 158, the Heir and Executor of a delinquent partner was decreed to -pay the deficiency of what his father ought to have paid, with interest. If he had not come in, he would have lost what had been advanced.
If a general partnership is entered into for an unlimited time, it may be put an end to at any time by any partner, but not if he acts mala fide; or does it with a sinister view, or after some particular business is begun, or at an unseasonable time, which might occasion loss or damage to the partnership. ” This is the doctrine even in cases of partnerships relating not to real estate: the principle is stronger in cases of permanent partnerships like this. In Watson, p. 381, it is said that a partnership for a term of years cannot be dissolved by the will of one, or of any number of the partners short of the whole of them a doctrine applying a fortiori to this case in which the partnership is permanent, requiring the possession of real estate in fee simple: it surely, therefore, cannot be terminated without the unanimous consent of all the partners; at least, until the object is attained by the completion of the building.
*If the Decree be reversed, the hostile defendants will have the plaintiff’s property, and be rewarded for their violation of a solemn agreement.
Eeigh in reply.
This Decree is not what it professes, and was doubtless meant to be a Decree for specific performance. A Decree for specific performance ought to ascertain and fix, or provide some method for ascertaining and fixing the precise act to be done, or sum of money to be paid, which, being done or paid, will amount to the performance, the Court means to decree. Otherwise, it must be left to the parties to agree between themselves what act or payment shall be a specific performance; or each party must be left to ascertain that point for himself; in either of which cases, the Decree would leave the parties and the conlroversj' exactly in the same state, it found them: or it must be left to one of the parties to ascertain the act or payment to be done or made by the other as a specific performance; which would be in effect a substitution of that party in the place of the Chancellor; and such is the character and effect of the Decree in this case. It is so general, and on that so uncertain, that the defendants could not know from the Decree itself what payments they were to make, or what act to do, in order to perform it.
The Decree directs that the defendants “shall in all things execute and perform their agreement, from time to time, according to its true intent and meaning.” But what was its true intent and meaning, and what should be done to fulfil it, were the very questions litigated between the parties. Mr. Bolling’s own notice to the defendants, requiring performance of the Decree on their part, is a direct admission of the uncertainty of the Decree itself ; for that notice proceeds to point out (what the Decree omits) what the defendants should pay, in order to perforin the Decree: but, if he was competent to do this, he is in effect the Chancellor, who decides the cause. By the arrangements between the parties, the money was to be paid in quotas, as called for; but the suit was instituted before all had been so called for; and it no where appears how much was due on the requisitions, that had been made at the time of the rendition of the Decree ; consequently, it is not ascertained by the Decree what precise sum *ought to be paid as a specific performance: the whole or part. Of the consenting partners, Harwood, Wilder and Walker say they have paid only part of the whole amount of their subscription : William and Henry Haxall say they have paid §540; and Holloway’s Administrator-says his Intestate paid $450, only. Yet Bolling requires the refractory parties to pay the whole $1000, on their subscriptions, with interest; and the Chancellor attaches them for not complying with this requisition, without any evidence that the consenting partners had paid the like sum, but Bolling’s own statement to that effect. It is said this objection to the Decree was *504not made in the Court of Chancery: but it is unimportant whether it was there made, or not; and, besides, it plainly appears, from the Chancellor’s Order, awarding' the Attachment, that the objection was distinctly made. In the case of Allen v. Harding, cited from 2 Eq. Cases abr. 17, the Decree did provide a method for ascertaining precisely the act to be done, as the specific performance of the Contract.
Upon the merits. This association was without doubt a partnership; for, although partnerships are most commonly of the mercantile kind, yet, to constitute a partnership, it is not necessary that the object of the association should be to carry on trade. “Contractus societatis est, quo duo pluresve inter se pecuniam, res aut operas conferunt, eo fine ut quod inde redit lucri inter síngalos pro rata dividatur:” Puff. lib. 5, c. 8: which Mr. Watson translates, “the relation of persons agreeing to join stock or labour, and divide the profits. ” Wats. p. 1. This association was precisely an unincorporated company' of partners, such as is described in Wats. p. 3.
I do not say that the agreement was not binding on the parties; I admit it was binding. I do not insist that the complaining parties ought to have been turned over to their remedy at Law; I admit their case was a proper one for relief in Equity. The parties should not have been driven to their legal remedy ; because it is doubtful whether a Court of Daw could entertain an action for one partner against another; and because, at all events, the case was proper for a Court of Chancery, to avoid multiplicity of actions at Law. The single question for the Chancellor to decide was, whether he should decree a specific performance? or decree compensation to *the complaining partners against the refractory partners, ascertaining such compensation by' an issue of quantum damnificatus? I insist that the latter was the proper, and the only proper, course.
A specific performance was not the proper relief. The constant doctrine of the Court is, that it is in its discretion, whether, in such a Bill, it will decree a specific performance, It is true that Ld. Hardwick said in Buxton v. Liston, 3 Atk. 383, that specific performance of articles of co-partnership ought to be decreed; but that was an extra-judicial dictum, and that doctrine is expressly over-ruled, and justly exploded, in Hercy v. Birch, 2 Vesey jr. 629, where Lord Eldon says, “no one ever heard of this Court executing an agreement for a partnership, when the parties might dissolve it immediately afterwards.” The reason is obvious: it cannot be for the interest of any of the members of an association to be bound in a partnership with others, whose views, interests, wishes and feelings are hostile and conflicting. So, in the present case, what could be more absurd than to bind Bell in this partnership, when he had ceased to have any interest in promoting its prosperity, and had become very hostile ; or Powell, who had a direct interest to disappoint the company from all profit from their Tavern; or Birchett, Taylor, Cumming, the representative of Potts, and Walker, who had all become averse to the farther prosecution of the project, for the reasons, they have assigned, and would therefore throw every obstacle in the way for the execution of it?
Again, specific performance ought not to. be decreed; because the parties had themselves suspended the execution of their plan so long, (nearly three years,) that it might well have happened, in the interim, that it would be inconvenient and disadvantageous, to some of the partners to go on with the scheme at so late a period. The Bill says, a majority wished the suspension, and Bolling acquiesced in it, to his own injury and that of the Company. It does not appear, but that the now refractory partners were in that minority, opposed to that injurious suspension, and the now consenting partners in that majority, which insisted on the suspension. Bell certainly was in the minority on that occasion, for he is described in the Bill, as being the most zealous and active of them all at first, ’’and not to have become hostile ’tilL 1810. Suppose this were the true state of facts. Shall a specific performance be decreed, in behalf of those, who were opposed to it during a lapse of almost three years, against those, who were anxious at first for a prompt and immediate execution of the plan.
In truth, only the plaintiff Bolling and the defendant Harwood are now desirous of a specific performance: of the rest, some say only that they are willing to perform, though quite indifferent about it; and six others say they are averse to going on with the scheme. Now, surely, in a partnership lik e this, a majority might dissolve the company. Shall it be continued at the instance of a minority of two?
The refractory partners broke off before any material part of the work had been done; so that little or no injury could have resulted to the rest from the abandonment of the plan by them. They broke ofE before Bolling had executed the Deed; as is proved by the plaintiff’s own witness Hawkes; they broke off before the only efficient general meeting was held, that of April 1810; in short, before any thing'had been done, except the removal of an old house by Bolling.
In every view, therefore, specific performance was not the proper relief; either on general principles, or on the particular circumstances of the case.
The remedy was plain ; to decree compensation to those of the consenting partners, who had sustained injury by the refusal of the rest to abide by their agreement: and the mode of ascertaining the compensation was equally obvious, and issue of quantum damnificatus. Bolling had suffered an injury from the removal of his house, and the loss of the rents. The difference between the value of the house as it stood, and the value of the materials, after it was taken down, added to the rents he lost, was the precise amount of the damage, he sustained; and nothing could be more easily *505adjtisted. As to the others, it is difficult to see how they suffered any injury, which could not be redressed by a release to the company of the shares of the refractory partners.