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7 corrections, most recently by doug.butler - Show corrections

- ANTHONY HORDERN & SONS. I

CLAIM FOR SHARE IN PROFITS.

SONS OF ONE OF ORIGINAL

PARTNERS CLAIMANTS

A case of considerable Importance involving large sums of money, was commenced in the Equity Court, before the Chief Judge, Mr. Justice A. H. Simpson, yesterday.

Dr. Cullen. K.C., Mr. Shand, K.C., and Mr. Sheppard (instructed by Messrs Dean and Dean), appeared for the plaintiffs; and Mr. Gordon, K.C., Mr, Langer Owen, K.C., Mr. Rich, and Mr. Browne for the defendant.

In the statement of claim, the plain- tiffs, Arthur Gilbert Hordern and An- thony Shubra Hordern, referred to the deed of partnership between Anthony Hordern, the younger, and the defend ant, Samuel Hordern, in 1787, and stat- ed that by its terms It was, inter alia, provided that the net gains and profits of the partnership should belong to the partners in equal proportion, and that all losses should be borne by them re- spectively in like proportion. The capital of the partnership at its com- mencement consisted of certain chat- tels, goodwill, assets, and effects of the old firm, valued at £23,761/0/4, the amount contributed by Anthony Hor- dern, the younger, being £13,761/0/4, and by Samuel Hordern £10,000. An thony Hordern, the younger, died on September 17, 1886, having made his last will, and a codicil thereto, on October 8, 1878, In which he appointed Samuel Hordern his sole executor and trustee. The deed of September, 1878 aid not provide any special mode of winding up or disposing of or dealing with the business or assets of the part- nership applicable to the events which had happened, and the plaintiffs sub- mitted that the death of Anthony Hor- dern, the younger, operated as a dlsso- lutlon of the partnership, and that it then became the duty of he defendant Samuel Hordern, to immediately pro- ceed to .wind up the the partnership according to law. He had, however, never taken any steps to wind up the partnership, but had carried on since the decease of the testator, and was still carrying on in Sydney and else- where, the business of the firm under the name of Anthony Hordern and Sons, with his capital and assets, with- out any final settlement ot account be- tween him the said firm and the estate ot the testator, and as his own absolute property, and had represented to the customers of the partnership, as well as to merchants and others dealing with the partnership firm, and the public generally, that he was car- rying on such business in continuation of the partnerfhip business of Anthony Hordern and Sons, and that he was the absolute owner thereof. The plain- tiffs submitted that in acting as stated he had committed wilful breaches of his duties as such surviving partner and trustee and executor. The testator left him surviving his wife, Mary Eliz- abeth Hordern and five children-three daughters and two sons. There were ample funds in the estate of the testa- tor to provide for the annuities of £208 per annum bequeathed to each of testators daughters by his will without recourse to the subject matter of the suit The defendant had recently claimed to be absolutely entitled to the whole of the partnership business and assets for his own benefit as from the death of the testator, and had re- fused to account to the plaintiffs or either of them for any part of the profits of the business accrued since the death of the testator, or to give the plaintiffs such Information as to the profits or state of the business at or since the death of the testator, as was necessary to enable them to discover the share of the estate of the the testa- tor in the assets of the partnership at his decease, or to exercise their option to claim a share of such profits or in terest on the value of the testator's share in the partnership assets.

The plalntiffs, therefore, prayed that

it might be declared that the partner-   ship was dissolved by the death of An-  

thony Hordern, the younger, on Sep tember 37, 1886, and that It might be

declared that Samuel Hordern had  

from that date carried on, and was still  

carrying on, the business, In breach   of his duties as surviving partner and   as executor and trustes of the will and   codicil of Anthony Hordern, the  

younger.

Plaintiffs further asked for an ac-

count of the partnership dealings be- tween defendant and Anthony Hordern   the younger, also as to the value of the   goodwill and assets of the partnership on September 17, 1886, and in what proportion such assets belonged to An- thony Hordern, the younger, and Samuel Hordern respectively.

Plaintiffs also asked for an account of the profits in the business since Sep- tember, 1886, the amount of interest to which tte estate of the testator was en- titled on the value of the estate, in the good will and assets of the partnership, and that on these matters being duly

certified it might be declared that the plaintiffs of the plaintiffs and Mary Elizabeth Hordern, were entitled to ex- erclse an option to claim on behalf of the estate of the testator as against the defendant either the amount of the share to which the estate should be

so certified to be entitled to the proflts,

or, in the alternative, such interest as aforesaid. Plaintiffs also asked that the partnership might be wound up under the direction of the Court, and

that a manager and receiver should be

appointed for the purpose.

The defendant, Samuel Hordern, in his statement of defence, said he did   not admit that the indenture of part- nership did not provide any special mode of winding up or disposing of or dealing with the business or assets of the partnership, applicable to the events referred to. On the contrary,

the indenture contained a clause which was applicable to the said events. In accordance with the provisions of the clause, upon the death of Anthony Hordern the younger, a general ac-

count in writing was, on October 2, 1886, taken of the assets belonging

to or owing to the partnership; also of

all debts due or owing by the partner-

ship including all principal and inter-

est due to the partners. And in the taking of the account, such stock and

other assets as did not consist of

money were valued in the usual way nothing being charged for the good-will. The defendant, as the surviving partner, paid the executor of Anthony Hordern, the younger, his full

share, to which he appeared to be entitled, namely £158,232/15/10. He submitted that upon the payment of

this sum, the whole assets of the part- nership became vested in him, as his property absolutely. Since the pay-

ment, he had carried on, in his own right, the busdiness previously carried   on by the partnership, under the name of Anthony Hordern and S0ns. He de- nied that he had never taken steps to wind up the partnership, or that other- wie than as already stated he had car- ried on the business of the firm, with- out any final settlement of accounts

between him, or the said firm, and the estate of Anthony Hordern, the young-   er, or as his own absolute property, or at all.

He claimed the benefit of the provis-

ions of the statute of James 1. chapter 16 for the limitation of actions, and all other statutes of limitations in as full and ample a manner as if he had pleaded the same in bar of the state- ment of claim or to the relief sought

thereby. The sum of £158,232/15/10

was paid to the executor of Anthony Hordern on October 2, 1886, and he (the defendant) claimed the benefit of the same as a settled account. Full and complete accounts to date of the as- sets and dealings of the said partner- ship were taken under the direction of Anthony Hordern, the younger, and the defendant, on December 80, 1892 and a full and complete division, of proflts between the parties was made on the footing of such accounts, and the ac counts were signed as correct by An- thony Hordern, the younger, and the defendant. Full and complete accounts were also taken at various periods up to August, 1885, and a complete divi- sion of profits was duly made between the partners on the footing of such ac- counts which were examined and ac- cepted as correct by Anthony Hordern, the younger, and his agent, Henry Cornwall.    

Samuel .Hordern, !n his evidence, stated that he had been carrying on

the business of Anthony Hordern and   Sons since October, 1886. There were    

stocktakings every half-year, and at   the end of the year. His brother went out of business in 1884. In that year   he had a discussion with his brother   as to a change in the mode of taking   stock, and an agreement was arrived at

between them. This was that they     should take the goods down at the price at which they were landed in the stores. Where the head of a de- partment thought the goods were not worth the value of the cost price, he would bring it under the notice of wit- ness's brother, or his head man. If   any stock was damaged, it would be taken at their value. The method of stock-taking adopted before the agree- ment, in 1884, was to put 25 per cent on the goods, and then take 25 per

cent off, and this, in his opinion, was a foolish way. The 25 per cent was   put on goods bought in Sydney or Mel-

bourne. There was, in proportion, very little of goods coming from Lon- don, but 50 per cent was put on Lon- don goods, as it was considered that this would be equal to the 25 per cent for those bought here.

His Honor: What do you mean by taking it off again? Mr Hordern replied that then they

took stock they reduced the value 25 percent off the selling prlce. This

did not bring it back to the actual in- voice price - not by a long way. They wanted ahout a third on to bring it to

that, sincethey took the stock down

to selling price, and then took 25 per

cent off. This was done till about 1884, and was a wrong way of doing   business. Since then, as he had said ,   the method was to take the stock down as landed in the store. This meant that to the actual price was added the actual prlce there was added the expense of bringing the

goods into the store.

His Honor: That had aothing to do    

with the selling price, though of

course it bore some relation to it?

Mr Hordern: Well, we add profit to the landed cost. After his brother's death in 1886, he told Mr. May to go round and have stock taken in the usual way for his brother's estate. He said to him, "I want you to tell these men that this is my brother's estate and that I would rather take it over value than under value. " He

communicated with Mr. Cornwall upon whom his brother settled his private

property, his trustees, and with Holds- worth, Macpherson and Company and after this correspondence had passed, Mr. Thomas Alcock, head of the firm of Alcock Brothers, and Mr. Ross, manager for Holdsworth, Macpherson and Company, came to the place of

business and valued the stock. The departments which Mr. Alcock valued

represented £150,000 out of £180,000  

The case is proceeding.    

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