Hampton v. Rose

HARDEN, J., pro tem. This is an action to dissolve a partnership and for an accounting. (See Hampton v. Bose, 3 Cal. App. (2d) 167 [39 Pac. (2d) 447], wherein an appeal from an order appointing a receiver was dissolved, and Hamptons. Bose, 3 Cal. App. (2d) 170 [39 Pac. (2d) 449], wherein a motion to dismiss an appeal from the judgment was denied, [448]for a statement of some of the facts.) The business was that of manufacturing and selling candy in Los Angeles.

Upon ample evidence the court found the existence of a partnership between plaintiff and defendant J. B. Rose. It is admitted that plaintiff was excluded from participation in the business and that Rose refused to render an accounting. By the judgment, the partnership was dissolved and a sale of partnership assets was ordered; and it was adjudged that, after payment of fees, costs and debts, the remainder of the proceeds of sale be devoted to the payment to plaintiff of $7,232.43; that thereafter, any surplus remaining be divided equally between plaintiff and Rose; that if the proceeds of sale proved insufficient to pay said sum to plaintiff after payment of fees, costs and debts, plaintiff recover from Rose one-half the amount of the deficiency with interest. Defend•ant J. B. Rose has appealed from the judgment.

From February 26, 1932', to June 30, 1932, the business had been run. by Rose. This is called the first period. The second period was from June 30, 1932, to March 13, 1933, during which time the business was run by Rose for the partnership. The third period is from March 13, 1933, to May 31, 1933, being a portion of the time during which it was run by a receiver.

The principal question on the appeal is as to the correct amount of the income during the second period. Rose reported gross sales during that time of $32,309.89. The cost of merchandise during said period was 51.59 per cent of said amount. In support of the claim that said sum was the total amount collected from sales, Rose produced the books kept in the regular course of the business and the testimony of several witnesses employed in the store. Some of the supporting records such as cash register readings, paid invoices or vouchers, and a production book were missing. Plaintiff claimed Rose withheld them from evidence and that their production would have disclosed a greater gross income than that reported. Under such circumstances resort was had to the testimony of an accountant. He was supplied with figures showing costs and income which are not disputed from which he concluded that during the first period (under Rose’s individual operations) the cost of merchandise was 35.91 per cent of the gross sales; that during the third period' (the portion of the administration of the receiver) cost of