Chitty, J.@mdashThis is a suit by the Plaintiff for a half-share in 3 Government promissory notes of the aggregate face value of Rs. 7,000. The Defendant claims that the notes belong entirely to him. The facts, though somewhat peculiar, are not seriously disputed, and on those facts I am at loss to see how in law or on common principles of honesty the Plaintiff''s claim can be resisted. The parties belonged to a very old established firm in this city, Bissonath Law & Co., which carried on at 2, Larkins'' Lane a business in wine and oil-man stores, hardware and other commodities. There were at one time 5 partners including Plaintiff and Defendant. In the eighties the firm was possessed of (inter alia) the 3 Government promissory notes in question in the suit. Those notes in 1886 disappeared and it was not then known whether they had been mislaid, lost or stolen. In 1895 the firm was re-constituted with 3 partners, Plaintiff, Defendant, and one Gocool Chundra Law. The Plaintiff had a share of 5 annas 6 pies and the others'' shares of 5 annas 3 pies each. The partnership was for a term of 20 years, any partner being at liberty to retire at any time on giving 12 months'' notice. The deed of partnership, dated 26th November 1895, is before the Court (Ex. A). In the year 1896, the 3 Government promissory notes, which had for 10 years been carried through the books, were by consent of the three partners written off. They were carried from the treasury account to the shop account and there debited. From that date (31st Chaitra 1302) they appeared no more in the firm''s accounts. On the 26th January 1898 the 3rd partner Gocool Chundra Law died. He was at the date of his death heavily indebted to the firm and the loss occasioned thereby amounting to over Rs. 9,000 was equally divided between Plaintiff and Defendant, who with the consent of Gocool Chundra''s son took over his share in the partnership. Thence forward Plaintiff and Defendant appear to have been considered as equal sharers in the firm, though strictly speaking their shares would be 8 annas 1 1/2 pies and 7 annas 10 1/2 pies. In February 1904 Plaintiff expressed a wish to retire from the firm from the 16th Falgoon then following. He had apparently forgotten the provisions in the deed as to 12 months'' notice. Correspondence of a perfectly amicable character passed between him and the Defendant which I need not discuss in detail. Defendant was willing that Plaintiff should retire, but it was found impracticable that he should do so from the early date which he had suggested. It was, however, ultimately agreed that his interest in the firm should cease from the 31st Chaitra 1310. Negotiations commenced as to the taking of accounts and the price at which Plaintiff should be bought out. The Defendant at first suggested that he should accept a sum of Rs. 3,000 in full satisfaction for his eight annas share. This ridiculous proposal, it is needless to say, did not meet with Plaintiff''s approval. In March the Plaintiff had the accounts examined, probably not very systematically or accurately. The result of that examination showed a sum of Rs. 57,686-8 to be due to him and by his letter of 26th March 1904 he offered to accept Rs. 45,000 in full satisfaction of his claim. This the Defendant did not accept and it was then mutually agreed that the accounts should be more carefully examined. This was eventually done by one Tulsi Das Paul and Netye, a son of Plaintiff. They were assisted by Ram Charan, the accountant of the firm, who was no doubt acting on behalf of Defendant. The Defendant repudiates this and tries to make out that he had no one to watch his interest. The question is not a very material one for several reasons. First, Ram Charan was an old and trusted servant of the firm, having been in their employ for some 40 years. There is no reason to suppose that he did not see that the accounts were properly taken. Indeed he admits that they were, and there is, moreover, no reason why he should favour one master at the expense of the other. Secondly, Defendant admits that he himself checked the accounts as they were taken and as he made no remonstrance of any kind I presume that he found them substantially accurate. Here again Defendant tells a manifest untruth. He says that he made out the balance due to Plaintiff to be about Rs. 30,000. The account as taken gave it at Rs. 39,465-7. It is incredible that if there was a discrepancy of over Rs. 9,000 he should not have mentioned it. I take it then that the accounts were properly and accurately investigated on behalf of both the parties and the balance as stated, Rs. 39,465-7, found in favour of the Plaintiff in respect of his eight annas share. The matter did not end there The Defendant, as might be expected, made some efforts to obtain a reduction. He very probably (as he states) made an offer of Rs. 30,000 which he afterwards increased to Rs. 32,000; eventually Defendant offered Rs. 34,000 which Plaintiff accepted. This adjustment was evidenced by an assignment on Plaintiff''s part and an agreement on Defendant''s part which bear date 4th July 1904. By the former Plaintiff made over all his interest in the business to Defendant. By the latter Defendant agreed to pay Plaintiff the Rs. 34,000 by installments and charged certain premises to secure that payment. Throughout the negotiations and the taking of accounts which culminated in the settlement, no mention was ever made of the 3 Government promissory notes. They were from first to last not in the contemplation of the parties at all. They were never taken into account either as a possibly good asset or an irrecoverable item. The parties were wholly unmindful of their existence or non-existence. It is true that Defendant says that he had them in mind, but I absolutely decline to believe him on that point. If he had and did not mention them, it would have been a distinctly dishonest omission on his part.
2. From the time of the settlement the Defendant took over the firm with its outstanding and liabilities. He has, I am told, paid to the Plaintiff the installments due under the agreement and has in part discharged the other obligations.
3. Some two years later, in March 1906, it became necessary for the firm to leave the premises at No. 2, Larkins'' Lane, and in the course of removal these three Government promissory notes were found beneath a drawer in a safe, where presumably they had lain for over 20 years. The Defendant it is admitted has received arrears of interest from Government upon the notes and the total amount in his hands is Rs. 9,491-2-4. Of this Plaintiff claims the half-share, and, as I said at the outset, I can see no defence to that claim.
The law in cases of this kind as was remarked by their Lordships of the Privy Council in McKellar v. Wallace 5 M. I. A. 372 (1853) is perfectly clear. Parties having accounts between them may meet and agree to settle those accounts by the ascertainment of the exact balance and if it afterwards turn out that there are errors in the account it is a sufficient ground for re-opening the account and for setting it right in a Court of Equity:
4. Their Lordships go on to distinguish cases in which persons meet and agree not to ascertain the exact balance but to take a gross sum as the balance; a sum which one is willing to pay and the other is content to receive as the result of those accounts. In such cases ordinarily speaking the accounts will not be reopened unless vitiated by fraud. There may of course be cases which fall into neither class but are betwixt and between. Such is the present case, for here the parties met and agreed to ascertain the exact balance, but when it had been ascertained the Plaintiff was induced to accept a lesser sum. This fact alone would be sufficient to distinguish the case above cited, but a perusal of that case shows also that the decision turned upon the facts which were peculiar and complicated, so that, but for the statement of law above referred to, it has not much bearing on the present suit. It is, however, abundantly clear that where an item has by the common mistake of both parties been omitted from the accounts, either the whole account may be reopened [as was done in Pritt v. Clay 6 Beav. 503 (1843)] or leave may be given to surcharge and falsily as was done in Gething v. Keighley 9 Ch. D. 547 (1878) I The latter is evidently the proper course to follow in this case. Indeed the Defendant through his Counsel has asked that if the Court should be against him the whole account should not be reopened. It is obvious that he would stand to lose by that course far more than he could possibly hope to gain, irrespective of the fact that the settlement has to some extent been acted upon. In this case there is no need of a reference or further taking of account in respect of this particular item, for the shares of the parties can easily be ascertained and the Plaintiff be given a money-decree.
5. The arguments addressed to me by the Defendant''s Counsel were, as far as I could understand, first, that the parties in this case settled for a lump sum without going into the accounts, and that therefore on the ruling in McKellar v. Wallace 5 M. I. A. 372 (1853), the matter could not be reopened. This however is contrary to the proved facts. The accounts were exactly ascertained, down to annas and pies. It was subsequent to that that Plaintiff agreed to forego Rs. 5,000 odd. It is true that one or two items in the accounts were of necessity approximate, e.g. the value of the stock-in-trade, but the adjustment was as accurate as it could possibly be without actually selling off the goods in hand.
6. Then it was argued that the settlement having been comprised in and confirmed by two contracts in writing, the Court could not go behind it. That, however, is clearly contrary to the rulings. The general words in the assignment can only operate to pass what the parties had in contemplation and not something with which they had no intention of dealing, see L. & S. N. R. Co. v. Blackmore. L. R. 4 H. L. 610 (1870) and Turner v. Turner 14 Ch. D. 829 (1880).
7. There is however no necessity in this case to rescind, rectify or disturb in any way the written contracts, or indeed to go behind the settlement at all, except for the adjustment of this particular item.
8. As to that it is clear that Plaintiff and Defendant are entitled to this property in equal shares. The heirs of Gocool Chundra Law have nothing to do with it. No doubt at the date of his death G. C. Law was entitled to a third share in these notes, but as he died indebted to the firm, and Plaintiff and Defendant took over his share in the partnership with the consequent loss in equal moieties, they became and are now entitled to retain his 3rd share, if any, in these notes in satisfaction of that debt which far exceeded the said 3rd share in amount. As between the Plaintiff and Defendant I can see no reason for going to an account in respect of this item. The accounts as adjusted were adjusted on the footing of equal shares, the Defendant as the continuing partner taking over the business with its outstanding and liabilities. There is no reason to suppose that these notes, had they been taken into account, would have been dealt with on any other footing. The result would have been merely to increase the share of each by so much. There will, therefore, be a decree in favour of the Plaintiff in the terms of para. 1 of the prayer of the Plaint except that there is no need to order an account. The Defendant must pay Plaintiff costs of suit calculated on scale 2. Interest on judgment at 6 per cent, per annum.
