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Sacco v. Schallus

Decided: December 15, 1950.


Haneman, J.s.c.


This is a motion by the defendant to dismiss the action herein commenced because the complaint fails to state a claim against him upon which relief can be granted. The facts set forth in the complaint upon which relief is demanded are as follows:

In the latter part of December, 1948, the plaintiff and the defendant orally agreed to be partners in the business of buying and selling at retail groceries, meats, produce and provisions in a store to be erected on property the purchase of which the said parties then had in contemplation. Under the terms of the agreement the parties were obliged to contribute equal amounts of cash for the purchase of the real estate; the construction of a building to be erected thereon; the purchase of all necessary fixtures, equipment, merchandise and other requisites of said business. In addition, the said parties were to contribute services in connection with the construction of the building contemplated, for which they were to be compensated as follows -- plaintiff at the rate of $2.50 per hour and defendant at the rate of 90c per hour, and their eventual respective capital interests in the partnership were to be predicated not only upon the actual cash contributed but upon the value of the services so rendered. The defendant was to keep a full, complete and accurate account of the business of the partnership. At the time the contract of partnership was entered into the defendant was 18 years of age and will not attain his majority until February 17, 1951. There is no allegation in the complaint that the defendant fraudulently misrepresented his age or that the plaintiff did not have knowledge at the time the agreement was entered into that the defendant was a minor. For all that appears in the said complaint, the plaintiff knew at the time the contract was entered into that the defendant was a minor. The liquid assets are presently of the value of approximately $500 and the debts approximately $1,000. The business has been conducted for some time past at a loss.

Plaintiff demands a dissolution of the partnership; contribution from the defendant for the monies he allegedly agreed to contribute and has failed to contribute; an assumption

of a share of the debts of the partnership; an ascertainment of the respective interests of the plaintiff and defendant in said partnership, and an accounting from the defendant.

The defendant has filed an answer and counterclaim in which he admits that there was an agreement of partnership entered into and that the parties were to contribute equally toward the purchase of real estate, construction of a building and the purchase of fixtures, equipment and merchandise. Defendant denies that he was to contribute additional capital, and that the furnishing of the actual labor for the construction of the building was to be paid for as plaintiff sets forth, but alleges that the plaintiff and defendant were to share the work on an equal basis and have an equal interest in the structure when completed. Defendant denies that he kept the books of the partnership.

By way of counterclaim, the defendant disavows the contract because of his infancy and seeks the recovery of the actual cash contributed by him to the partnership, and of the reasonable value of his services.

The gist of the defendant's motion is that in view of the fact that the plaintiff admits defendant's infancy, and in further view of the fact of defendant's disavowal of the contract, plaintiff is barred from any relief.

Plaintiff's argument in opposition thereto bases his right to relief upon the contention that the defendant, upon a disavowal of the contract, is required to put him in statu quo. Paraphrased, this can only mean that the infant cannot retain the benefits while disavowing the contract. By this argument, he contemplates that the defendant must make further contributions of cash allegedly not heretofore made in accordance with the terms of the contract, and that the defendant should share proportionately in the losses sustained in the operation of the business and have an interest in the assets of the business in such proportions as the court may find the agreement called for.

The question here involved, therefore, is whether the plaintiff is entitled, under the facts pleaded, to the relief demanded.

It must, at the outset, be conceded that generally all contracts of infants are voidable. La Rosa v. Nichols , 92 N.J.L. 375, 105 A. 201 (E. & A. 1918); Levine v. Mallon Oldsmobile Co., Inc. , 127 N.J.L. 197, 21 A.2d 852 (Sup. Ct. 1941); R.J. Goerke Co. v. Nicolson , 5 N.J. Super. 412, 69 A.2d 326 (App. Div. ...

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