Translate
Text Highlighter

Bookmark

PDF

Share

Report a problem
AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Attorney(S)
  • Flanders, for the plaintiffs. Barnard Leach, for Loverin and Wadsworth. The property attached on which the question of priority depends is the interest of H. Russell in the stock of Russell Fellows, which remains after paying the debts and adjusting the affairs of that firm. This must be considered the individual property of H. Russell. The old firm of Russell Son had been dissolved over a month in good faith, and with immediate notice to the plaintiffs. When Russell Fellows began business, each owned one undivided half of the stock, and the interest of each was his individual property. The creditors of the old firm of Russell Son lost their priority in the share H. Russell took at the dissolution of that firm when they allowed it to go into another firm as his individual property and with full knowledge allowed the new firm creditors to gain a priority over them. If by a bona fide transfer partnership property has become the several property either of one partner or of a third person, the equities of the partners are extinguished and consequently the derivative equities of the creditors are at an end. Case v. Beauregard, 99 U.S. 119, 125. Rights of partnership creditors to a preference in partnership property do not extend so far as to affect a bona fide transmutation of partnership into private property made prior to or upon a dissolution. 1 Pars. Cont. 212; Howe v. Lawrence, 9 Cush. 553; Collyer Part., s. 358; 4 Gilman (Ill.) 38; Morrison v. Kurtz, 15 Ill. 196; 13 Gray 121; 14 Gray 537; 3 Allen 83; Parker v. Bowles, 57 N.H. 497, in which, by citing with approval Ruffin, Ex-parte, 6 Ves., Jr., 119, the court overrule Ferson v. Monroe, 21 N.H. 468. Separate creditors of a person who is a member of two firms have a preference over his interest in property derived from one of the firms as against the creditors of the other firm. Weaver v. Weaver, 46 N.H. 188; 20 How. 125. Flanders, for the plaintiffs, in reply. All that is necessary to enable different classes of partnership creditors to enforce their priority is, that the property can be traced through the successive partnerships. The priority of the creditors does not rest on the equities of the partners inter se. Jarvis v. Brooks, 23 N.H. 136, 146; Benson v. Ela, 35 N.H. 402, 410, 411, 415; Weaver v. Weaver, 46 N.H. 188, 191, 192. The partnership property of O. K. Russell Son is traced to H. Russell, the son, and his interest in it is held by the plaintiffs' attachment. There was no prior attachment. Loverin is not a creditor of either of the firms. Russell Fellows had no creditors. There has been no subsequent attachment. After Flanders attached the property on the plaintiffs' writ, any subsequent attachment should have been made by him. The proceedings of Loverin Wadsworth were not such as the law recognizes as a legal attachment.
Judges
  • DOE, C. J.
Are you a practicing lawyer?
Enhance your digital presence and reach by creating a Casemine profile.
Upload pleading to use the new AI search
Click here to upload
Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Attorney(S)
  • Flanders, for the plaintiffs. Barnard Leach, for Loverin and Wadsworth. The property attached on which the question of priority depends is the interest of H. Russell in the stock of Russell Fellows, which remains after paying the debts and adjusting the affairs of that firm. This must be considered the individual property of H. Russell. The old firm of Russell Son had been dissolved over a month in good faith, and with immediate notice to the plaintiffs. When Russell Fellows began business, each owned one undivided half of the stock, and the interest of each was his individual property. The creditors of the old firm of Russell Son lost their priority in the share H. Russell took at the dissolution of that firm when they allowed it to go into another firm as his individual property and with full knowledge allowed the new firm creditors to gain a priority over them. If by a bona fide transfer partnership property has become the several property either of one partner or of a third person, the equities of the partners are extinguished and consequently the derivative equities of the creditors are at an end. Case v. Beauregard, 99 U.S. 119, 125. Rights of partnership creditors to a preference in partnership property do not extend so far as to affect a bona fide transmutation of partnership into private property made prior to or upon a dissolution. 1 Pars. Cont. 212; Howe v. Lawrence, 9 Cush. 553; Collyer Part., s. 358; 4 Gilman (Ill.) 38; Morrison v. Kurtz, 15 Ill. 196; 13 Gray 121; 14 Gray 537; 3 Allen 83; Parker v. Bowles, 57 N.H. 497, in which, by citing with approval Ruffin, Ex-parte, 6 Ves., Jr., 119, the court overrule Ferson v. Monroe, 21 N.H. 468. Separate creditors of a person who is a member of two firms have a preference over his interest in property derived from one of the firms as against the creditors of the other firm. Weaver v. Weaver, 46 N.H. 188; 20 How. 125. Flanders, for the plaintiffs, in reply. All that is necessary to enable different classes of partnership creditors to enforce their priority is, that the property can be traced through the successive partnerships. The priority of the creditors does not rest on the equities of the partners inter se. Jarvis v. Brooks, 23 N.H. 136, 146; Benson v. Ela, 35 N.H. 402, 410, 411, 415; Weaver v. Weaver, 46 N.H. 188, 191, 192. The partnership property of O. K. Russell Son is traced to H. Russell, the son, and his interest in it is held by the plaintiffs' attachment. There was no prior attachment. Loverin is not a creditor of either of the firms. Russell Fellows had no creditors. There has been no subsequent attachment. After Flanders attached the property on the plaintiffs' writ, any subsequent attachment should have been made by him. The proceedings of Loverin Wadsworth were not such as the law recognizes as a legal attachment.
Judges
  • DOE, C. J.
See more information ...
Smart Summary

SPURR v. RUSSELL.

The sale by one of two partners of his partnership interest to one who becomes his successor in the firm, does not destroy the priority of the right of a creditor of the original firm to payment of his debt out of the partnership property of the original firm to the extent of the other original partner's interest in that property.

DOE, C. J.

By a rule well settled in this state, the sale by O.K. Russell of his partnership interest, and the introduction of Fellows, his vendee, as his successor in the film, did not destroy the priority of the plaintiffs' right to payment of their debt out of the property of the original firm of O. K. Russell Son to the extent of the son's interest in that property. If by this rule the rights of the parties are not fully adjusted, they can be heard again.

Case discharged.

BINGHAM, J., did not sit: the others concurred.

Use AI to get other relevant cases.
Try AI Pro free for 7 days Upgrade to AI Pro

Comments

SPURR v. RUSSELL
(Dec 1, 1879)