
    Mary F. Jackson, as Executrix, etc., of Ebenezer C. Jackson, Respondent, v. William H. Jackson, Individually and as Executor, etc., of John H. Hankinson, Deceased, Appellant, Impleaded with Mary F. Hankinson, as Executrix, etc., of John H. Hankinson, Deceased, Defendant.
    
      Equity suit — a, judgment not reversed for error in the admission of evidence which is not prejudicial—the plaintiff may show that he endeavored to adjust the matter — it bears on the costs.
    
    A judgment rendered in an equity action will not be reversed because, of an error in the admission of evidence unless such error was manifestly prejudicial. The plaintiff in an equity action is entitled to show that he endeavored to adjust the matter before bringing the action, as this has a material bearing upon the question of costs.
    Yan Brunt, P. J., dissented.
    Appeal by the defendant,' William H. Jackson, individually and as executor, etc., of John H. Ha-nkinson, deceased,, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 16th day of December, 1903, upon the report of a referee.
    
      
      Charles W. Pierson, for the appellant.
    
      Henry White, for the respondent.
   Laughlin, J.:

.The plaintiff’s testator, Ebenezer 0. Jackson, and the defendant: .William H. Jáckson, who were brothers, and the decedent, John H. Hankinson, were copartners in the business .of manufacturing and selling grates, fenders and other hardware in the city of New York. The copartnership was terminated by the death of < Hankinson in, 1890. The plaintiff’s testator brought this action alleging that,, without his knowledge or consent, the appellant and the deceased Hankinson engaged in private land speculations, using therefor the Copartnership funds and credit in large amounts, and he demanded an accounting for the use of these funds and credit’and a general ' copartnership accounting. .He died subsequent to the decision, and the action was revived in the name of his executrix.

Considerable of the ■ copartnership assets remained unadministered. The learned referee^ therefore, disregarded the demand for a general accounting and treated the action as one for an accounting of the copartnership funds and credit used in these land specu- ■ lotions. This course is neither questioned nor objected to by either ■ party.

The theory of the plaintiff’s testator evidently was that he was, entitled to an accounting, and in the event that profits were made-in the real estate transactions that he would be entitled to share therein, but that otherwise the appellant and estate of the déceased Hankinson would be ¡chargeable with the moneys thus diverted and interest thereon. The theory of the appellant was that he .was only chargeable for the moneys withdrawn from the firm, together with interest thereon. The correctness, of thes.e -respective contentions depended upon whether or not the plaintiff’s testator knew and acquiesced in. the use of the copartnership credit and funds by the . appellant and> Hankinson for their individual benefit. The evidence adduced upon this,point by the respective parties presented a question of fact and the determination of the referee is fairly sustained. The learned refereé, in a well-prepared opinion, considers the contention of the respective parties and. reviews the material' evidence; and, were it not that certain exceptions to the exclusion of evidence not discussed in the opinion áre urged upon the appeal as grounds of reversal, the judgment might well be affirmed upon the opinion of the referee.

The so-called private real estate speculations in which copartnership funds were used commenced in 1884. The first of these copartnership funds were charged upon the firm books under a property account entitled “Imperial, 57 East 76th Street, property of William H. Jaókson and J. IT. Hankinson,” and “Douglass Street, Brooklyn, property of W. H. J. and J. H. H.” Thereafter until 1890 the amounts thus withdrawn were charged in the property accounts under the names of the respective properties without a designation as to the ownership. The receipts from the respective properties were credited on these respective accounts. The firm had been in existence since 1880 and it continued the practice of its predecessor in making the first entry of cash receipts and disbursements upon tickets or slips from which they were subsequently entered, daily as a rulé, in the cash book. The firm from time to time in the course of its hardware business found it advisable, advantageous or necessary to acquire and dispose of real estate and securities, the receipts and "disbursements concerning which were kept in property accounts designating the particular piece or tract or securities. During the year-1890 and thereafter the receipts and disbursements concerning the so-called private real estate transactions of the appellant and Hankinson were entered as usual upon tickets or slips which were kept in the cash drawer, but no entries were made in the firm books proper concerning the same until the end of the year, at which time the receipts and disbursements shown by these tickets or slips were tabulated upon a sheet and a balance struck, which was. carried into the annual statement of the firm accounts and thus entered upon the books. In the annual statement of assets and liabilities for the year 1889, and prior thereto, the balance unpaid, of' moneys thus withdrawn and invested, was embraced in an item designated as accounts receivable, which also included the- firm real property and merchandise accounts as well. The next year it appeared in a property item including the firm property as well. Subsequently it appeared as a separate property item designated as “ W. H. J. and J. H. H.” and the firm property appeared as a property item with the designation “ W.. H. J. & , Co.” These tickets or slips have been preserved and the appellant offered them and the sheets in-evidence upon the theory that they formed part of the firm books. The plaintiff interposed objections and. they were excluded. It is claimed that this constitutes reversible error. It is not here contended that there was any error in balancing these accounts annually or in the balance as -entered in the annual statements and in the books. ■ The relevancy and materiality of appellant’s contention that these tickets or slips and sheet's constituted part of’ the firm accounts, is that the plaintiff’s testator had actual knowledge thereof by reason of his having access thereto and that even if he did not have actual knowledge he is chargeable with constructive knowledge. Assuming that they constituted part of the firm accounts, we fail to see how the appellant was prejudiced by their exclusion. All of the material facts concerning them were .shown and balances of these accounts, testified to be correct, were received- in evidence in the reception of the copartnership books. They will be admissible upon the accounting and may then" become material evidence.

Prior to the commencement of the action plaintiff’s testator and liis attorneys wrote several letters to the appellant and his attorneys wrote other letters to the attorneys for the appellant asking for information, concerning the assets and liabilitiesi of the firm, referring to a claim alleged to have been made by the appellant that the firm was insolvent-and criticizing him therefor and containing suggestions and propositions with reference to an adjustment and settlement. There was no reply to most of these letters. They were offered in evidence by the plaintiff and received under appellant’s «objection and exception that they were irrelevant, immaterial- and declarations in plaintiff’s own favor. Some, of these letters to which iio reply was made may be subject to the objection that they contain declarations in favor of the plaintiff; but it is to be borne in mind that this is an equity suit in which a reversal should not be had for ah error in the admission of evidence unless it. was manifestly prejudicial. The plaintiff had- a- right- to sliow that he endeavored to adjust -the matter before bringing the action as this would have a material bearing1 upon the question of costs. We are of opinion that although the reception of some of -the, letters, without limiting their bearing, may have been erroneous, it does not constitute substantial error or require a reversal.

It follows that the judgment should be affirmed, with costs.

Patterson, O’Brien and Hatch, JJ., concurred; Van Brunt,

P. J., dissented.

Van Brunt, P. J.

(dissenting): I dissent. There were so many instances of the admission of concededly incompetent evidence that it must have influenced the referee. The judgment should, therefore, be reversed.

Judgment affirmed, with costs.  