Opinion
02-18-1890
ALPAUGH v. SAVAGE et al.
E. R. Walker, for complainant. C. C. Robbins, for defendants.
On bill in equity.
E. R. Walker, for complainant. C. C. Robbins, for defendants.
BIRD, V. C. I have given this case a very great deal of attention, because I have had the conviction that it presented strong equity in favor of the complainant. There is no little testimony taken to prove that the defendant Savage deliberately went about perpetrating a fraud upon the complainant. But this I need not pass upon. That the complainant has suffered is beyond question. But other parties had become interested, and their rights claim the attention of the court. So far as I can see, the defendant Walker was innocent in his transactions in the premises; and if this be so, he has a stronger equity in the case than the complainant has. He indorsed notes and advanced his money, and took an assignment of the partnership assets after such advance in payment, and because of the manner in which this was done I think he has a higher demand upon the court than the complainant has. In general, the circumstances may be stated as follows: Savage had entered into a contract to build two bridges, one Crow Creek bridge, and the other the Two Counties bridge. He entered into a copartnership with Alpaugh to effect the building of these bridges, and had the benefit of Alpaugh's credit in raising money for that purpose. In a short time Alpaugh discovered such a condition of affairs as induced him to believe that he had better withdraw from the copartnership. They entered into an agreement of dissolution. By this agreement Savage was to pay the debts of the concern, and consequently reimburse Alpaugh; for the doing of which Alpaugh assigned to him or agreed that he should have all of the assets of the copartnership. I think the testimony satisfactorily establishes the claim of Alpaugh that he was to have the balance of the money then due or to become due on the Crow Creek bridge contract, but I cannot come to the same conclusion as to the amount due or to become due on the other bridge contract. In the bill of complaint, Alpaugh says that Savage promised to payhim the money due to him on the Crow Creek bridge contract as it became due, but this he never did. This money being beyond the reach of the complainant, he now seeks to have appropriated, under the direction of this court, the balance of the money due upon the Two Counties bridge. If this money ever was part of the partnership assets, I must, from the testimony, conclude that, at the time of the dissolution, Alpaugh disposed of his interests in the assets to Savage, so that he lost his lien as a partner, and put it in the power of Savage to dispose of all partnership property discharged of any such lien; and Savage, having become indebted to the defendant Walker, made an assignment of all his interest in the Two Counties bridge contract to said Walker, as collateral security for the payment of the amount that should become due to said Walker. This view seems to be sustained by the case of Vosper v. Kramer, 31 N. J. Eq. 420. A decree will be advised that the bill be dismissed, with costs as to the defendant Walker; and that an account be taken as to the amount due, if any, from the defendant Savage to the complainant, for which purpose it will be referred to a master. All further directions will await the report of said master.