A practical treatise on the Law of Partnership

culding that they absented themselves from [*282] *their shop with an intent to delay their creditors. (a) So, a conveyance by a firm of all their stock in trade, debts, and effects, for the benefit of all their creditors, but without the concurrence of every creditor both joint and separate, is an act of bankruptcy.(b) But a conveyance executed by one only of three partners with an intent that it shall not be effective unless executed by all of them, is not, as it seems, an act of bankruptcy.(c) And where one of three bankers, who was the only residing partner at the place where the business was carried on, and who alone transacted the business, absented himself from the banking-house, shut it up, and stopt payment, it was determined that this was not evidence of a joint act of bankruptcy committed by all the three ;(d) and there is not wanting the authority of Lord Eldon to show that such an absenting by one partner does not constitute an act of bankruptcy by each of those who may be united with him in partnership.(e) So, if one of two partners go abroad for the purpose of transacting his business, but not with the intent of avoiding his creditors, and, in consequence of the other partner having contracted a debt in the partnership name and committed an act of bankruptcy, the clerk of the firm goes to the partner abroad, and communicates to him the insolvent state of the house, upon which he expresses his determination not to return, this is not a sufficient act of

(a) Capper v. Desanges, 3 B. Moore, 4. S. C. 8 Taunt. 671. See Ex parte Gardner, 1 Ves. & Bea. 77.

(6) Eckhardt v. Wilson, S T. R. 140. See the cases of Berney v. Davison, 4 B. Moore. 126. and Berney v. Vyner, Ibid.

322,

(d) Mills v. Bennett, 2 Maul. & Selw. 556.

(e) Ex parte Mavor, 19 Ves. 543.

bankruptcy to support a joint commission. (a) A joint act of bankruptcy concerted between three partners and an attorney, who acted both as their agent, and as the agent of the petitioning creditor, is not sufficient to sustain a commission on the petition of the latter,

although he was not actually privy to the pre- [*283] concert.(b)

With respect to the petitioning creditor's debts, the amount of it, its nature, and the time when it should have been contracted to sustain a joint commission, differ in no respect from those requisites which the law has imposed, to give it validity in the case of a separate commission. It . will therefore be sufficient to observe that it must be a joint debt due from or payable by(c) all the partners, since none other can be made the foundation of an application for a commission against the members of a firm collectively. It must also have been contracted before any of the acts of bankruptcy which are to support the commission were committed. Therefore, where an attorney after an act of bankruptcy committed by one partner,, but in consequence of a previous retainer, had a sum due to him from the firm, it was held that the debt did not constitute a good petitioning creditor's debt to support a joint commission.(d)

(a) Ex parte Mutree, 5 Ves. 576. See Warner v. Barber, Holt's N, P. C. 175.

(b) Prosser v. Smith, Holt's N. P. C. 442. See also Ex parte Staff, Buck. 440.

(d) Ex parte Miller, Buck, 283. By a late act of parliament it is provided that, if, after adjudication, the debt of the petitioning creditor be found insufficient, the Lord Chancellor may, upon the application of a creditor who has proved a sufficient debt, and whose debt has been incurred not anterior to that of the petitioning creditor, order the commission to be be proceeded in, and it shall by such order be deemed valid. See 6 Geo. 4. c. 16. s. 18.

Where there is or has been a joint trading, acts of bankruptcy have been severally committed by each member of a firm, and a legal petitioning creditor's debt to the requisite amount is due from them, a joint commission of bankruptcy may be effectually sustained. But in such a commission, before the late statute, all the ostensible partners must have been included; for a commission being, to some purposes, considered as in the nature of an action at law, it was held that a joint commission against two of several partners could not be supported. (a) If one partner had been an infant, and therefore strictly not an object of the bankrupt laws, (b) or if one had [*284] laboured under the influence of that dreadful visitation, lunacy, (c) or had been an uncertificated bankrupt, (d) there could not be a joint commission against the others; separate commissions must have been taken out against each individually. This however is remedied by a recent enactment, (e) which declares "that any creditor or creditors whose debt or debts is or are sufficient to entitle him or them to petition for a commission against all the partners of any firm, may petition for a

(a) Allen v. Downes, Willes' Rep. in not. 474. Streatfield v. Halliday, 3 T. R. 779..

(b) Ex parte Henderson, 4 Ves. 163. 601. Rex v. Cole, 1 Ld. Raym. 444. son, 16 Ves. 265.

Ex parte Barwis, 6 Ves.

But see Ex parte Wat

(c) Ex parte Layton, 6 Ves. 440. (d) Ex parte Martin, 15 Ves. 114. Ex parte Bold, Co. B. L. 12. In a case where an uncertificated bankrupt entered into partnership with another person, and a joint commission issued against them, Sir William Grant held, that the creditors of the partnership had no equity against the assignees under the first commission for an account and application to their debts of the property used or acquired in that partnership. Everett v. Backhouse, 10 Ves. 94. And see Ex parte Storks, 2 Rose, 179. S. C. 3 Ves. & Bea. 105.

(e) 6 Geo. 4. c. 16. s. 16.

commission against one or more partners of such firm; and every commission issued upon such petition shall be valid, although it does not include all the partners of the firm.” Before this statute it was not necessary to have included a dormant or secret partner in a commission against the ostensible partners ;(a) although, where there was a partner abroad, and from the title of the firm, as if it had the word "company" subjoined, it was doubtful whether it consisted solely of the partners in England, it would not have been prudent, without inquiry, to have issued a commission against the latter only. (b) Doubts, indeed, have been entertained, whether a joint commission can be supported against the ostensible members of a firm, and a dormant partner whose interest is confined to a share of the profits; (c) but probably, as a joint creditor has an election to consider a dormant partner his debtor, and as there is scarcely a partnership in which the members of it are not entitled in different interests, a commission including him would be upheld on the ground that the joint property must be considered, as regards its *distribution under the bankrupt laws, the pro- [*285] miscuous joint property of them all.(d)

Formerly, where there were several partners, it used to be the practice to take out separate commissions against each partner, as well as a joint commission against all of them. (e) This arose, probably, from the difficulty which commissioners found, where only a single commission was

(a) Ex parte Benfield, 5 Ves. 424.

(b) Ex parte Layton, 6 Ves. 438.

(d) Ex parte Hodgkinson, 19 Ves. 294. Ibid. 455. Ex parte Watson, Ibid. 459. Rose, 382.

(e) In re Simpsons, 1 Atk. 137.

Ex parte Norfolk, Ex parte Hunter, 2

taken out, of marshalling the joint and separate estates between the respective classes of creditors, the statute having given no direction for that purpose; but that practice was discountenanced, it having been the common course of the court, upon petition, to make an order for the separate creditors to come in and prove their debts under the joint commission; and that the assignees should keep distinct accounts of the respective estates. (a) And now by a general order(b) made by Lord Rosslyn, where there is a joint commission issued, the commissioners are to cause distinct accounts to be kept of the joint and separate estates, and any separate debts due from individual partners, (or where there are inferior partnerships, consisting of some of the bankrupts, debts due from such partnerships,) (c) are to be proved under the joint commission; the respective estates to be applicable in the first instance to the payment of their respective debts.

According to the present practice, a joint commission against all or two or more of the partners, or separate commissions against each of them, may be supported ; but it seems that a joint commission against all and a separate commission against any of the partners cannot legally subsist at the same time, if the commission

which is prior in point of existence was acted [*286] upon and in legal operation, (d) *because, by the

assignment under it, all the interest and effects of the bankrupts or bankrupt will vest in their or his assignees. At law, therefore, if a joint commission be first issued, and be proceeded in, a subsequent separate commission is invalid; and if a separate commission, which has

(a) Co. B. L. 9.

(b) 8th March, 1794. 2 Co. B. L. 284. See also Twiss v. Massey, 1 Atk. 67. In re Powel, Davies, 373.

(d) Warner v. Barber, 2 B. Moore, 71. S. C. 8 Taunt. 176. Ex parte Bullen, 1 Rose, 136.

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