Case ID: scl_15/html/0519-01.html
Source: Caselaw Access Project
Author: {"author": "Johnson, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

John Robinson & Co. vs. Crowder, Clough & Co.
    A prior commission of Bankruptcy in England, docs not give the Assignees'a lien over attaching creditors in this State.
    No effect will be given in this State to the English Bankrupt Laws, nor to any provisionary assignment, made in aid of those laws.
    All assignments by a creditor in England, within two months of the suing out of a Commission of Bankruptcy against him are void, and the Assignees hold in trust for the Assignees under the Commission. .
    As between the Bankrupt and the Assignees under the Bankruptcy, the Commission transfers all the rights the Bankrupt has, whether in England orina foreign country,
    The Assignees, however, as to foreign debts, stand in no better situation than the Bankrupt himself, and arc subject to every equity, and to the remedies provided by the laws of the foreign State, and when they are permitted to sue there, it is net as Assignees, but as representatives of the Bankrupt.
    An assignment in England, within two months of Bankruptcy,, is an assignment in aid of the Bankrupt Laws, and will not give a lien prior to a subsequent attachment in this State, over rights attached here. . ,
    An assignment made by one partner of the effects of the firm, for the payment of their debts, though under seal, will bind the other partner.
    "Where a seal is not essential to f ho validity oí a contract, the addition of a seal will not vitiate it.
    The plaintiffs, on the 19th September, 1825, sued out a writ oí attachment against tiie defendants, merchants, upon which their property in South Carolina was seized. Thomas Case came in and suggested that the property attached did not belong to the defendants, but to him, the claimant. The Court, in pursuance of the attachment act, directed the plaintiffs to declare. An issue was takeii on the point, whether the goods, &c. attached were, at the time of their seizure, the proper goods of Thomas Case. The Jury found the following special verdict:
    
      u .We find that Thomas Crowder, and Henry Thomas Perfect, of Liverpool, in England, merchants residing there, and carrying on business there in partnership with James Clough, of Charleston, South Carolina, all British subjects, under the firm of Crowder, Clough & Co. did, on the 20th August, 1825, execute an assignment under their hands and seáis, to Thomas Case, at Liverpool, of all and singular the debts, estates and effects of the said Crowder, Clough & Co. within the United States, in trust for the benefit of all the creditors of the said Crowder, Clough & Co. rateably and in proportion to their several debts, and that the said assignment was recorded in the Secretary’s office of this State on the fith October, 1825, which said assignment is hereby referred to as a part of this verdict, and marked D.; and'that the said Thomas Case did, on the 20th August aforesaid, appoint W. Lance his attorney within the United- States. We find, also, that the said Thomas Crowder and Henry Thomas Perfect, committed an act of Bankruptcy, by stopping payment and closing up their house of business at Liverpool, aforesaid, on the 8th August, 1825, and that a commission of Bankruptcy issued against the said Thomas Crowder and Henry Thomas Perfect, some short time after the date of said assignment to Thomas Case. We also find, that on the 19th day of September, in the same year, John Robinson & Co. of Charleston, and other persons claiming to be creditors of the said Crowder, Clough & Co. sued out writs of attchment in this State against the said Crowder, Clough & Co. (the said John B. Clough being also at that time out of the State,) by virtue of which writs the debts and other effects of the said Crow-tier, Clough & Co. attached in the hands of the garnishees, and so alleged to be assigned to the said Thomas Case, are claimed by the said attaching creditors as subject to the debts they may prove against the said firm in exclusion of the said assignment. We also find, that James B. Clough, of the said firm of Crowder, Clough Si Co. was in the United States during the whole year 1825, and that a commission of Bankruptcy, issued against the said James B. Clough, in England, on the 10th June, 1826. — - But whether or not upon the whole matter aforesaid, in form aforesaid found, the said assignment to the said Thomas Case, vests in him the debts and effects of the said Crowder, Clough & Co. in preference to the said John Robinson & Co. and the other attaching creditors claiming under their said writs of attachment the Jurors aforesaid, are entirely ignorant and pray the advice of the Court, and if upon the whole matter so aforesaid found, it shall seem to the Court that the said assignment transferred to the said Thomas Case, all the debts and effects of the said Crowder, Clough & Co. in this State, and that the said attachments do not operate as a prior lien on the debts and effects so alleged to be assigned, then we find for the plaintiffs ; but if upon the whole matter it shall seem to the Court that the writs of attachment take a preference over the said previous assignment, then we find for the defendants.”
    His Honour; Mr. Justice Richakdso»-, upon this verdict ordered judgment to be entered for the claimant, Thomas Case, and the attachments to be discharged.
    From this order the plaintiffs appealed, and moved to set the same aside, and to have the property seized adjudged to be the proper goods, chattels, monies, &c. of the defendants, and liable in the hands of the garnishees to the plaintiff’s demands.
    
      
      King, for the motion.
    One of the partners was in the. United States — he remained here in 1825-1826. The commission of Bankruptcy was taken out in 1826, at London. Previous to the Bankruptcy the assignment was made in America. The effect of Bankruptcy, of two out of three, was to give to the solvent member the con-troul of the funds in his póssfession in Ameriea. F ox vs. Hanbury, 2 Cowper Rep. 445; Smith vs. Stokes, 1-East. 363.
    James Bulter Ciough, until he had committed an act of Bankruptcy, had fuil command over the funds in 1ns possession. Britwood vs. Miller, 3 Merivale 279, 282.
    The Bankrupt Laws of England only extend to the territory of England. The act of Banlmiptey in England of 1825, could not then effect in any way the property of the copartnership in America. It was well to consider the power of a co-partner in this country, where the principal domicil is in America. It was not a great deal to-say, that the act of Bankruptcy in England could not deprive him, without his consent, oí hiscontroul here. So long as he has not committed an act of Bankruptcy it will be beyond the power of his partners in England to deprive him of his legal controul over the property in his possession. Harrison & Sterrey, 5 Cranch, 289, 300.— Such a rule would deprive the partner of paying the debts which he had contracted here. The Bankruptcy dissolved the co-partnership. Montagu on Co-partnership, 118. The act of Bankruptcy is legally a fraud upon the solvent ^partner. It would be strange to suffer this act of the law in England to deprive the American creditor of the funds to which he gave credit in this country. The commission of Bankruptcy has relation back to the first act of Bankruptcy, no matter how secret, and it vitiates all intermediate transactions, and therefore the assignment to Case made in Liverpool, was void by the ka'w of England. A voluntary assignment by the laws of England ipso facto void, may be made for the payment of debts. Kennedy’s Bankrupt Law 99 — Appendix B. Exparte Blake, 1 Coxe, 198. Thomas Case then asks the Courts of this country to give effect to a deed void by the lex loei, where made, .and thereby to supercede the rights of the American creditors. Could it be pretended' that any such view could be sustained in England under this assignment ? The case had been fully discussed in N. York, hi the case of Holmes vs. Ranselm, 4 John. C. R. 489, and .Chancellor Kent,,afterafull consideration of the Cases, determined that he would give effect to a foreign assignmentunder their Bankrupt Laws — that the commission of Bankruptcy was the law of nations and would be •carried into effect by all nations ; a decision since overruled and directly opposed to all the English cases ; for even in the English Courts it has been determined, that Bankruptcy does not transfer property of the Bankrupt in á foreign country. The opinion of Ch. Kent was not founded on the private assignment in that case, but entirely upon the commission and assignment under it. In the same case, in 20 John. 267, Mr. Justice Pratt said', that the Bankrupt partner was as if he was dead.
    A deed by two of several partners does not bind those who do not sign it. — It is a mere nugatory act as to the others. 1 Montagu Partnership, 42, 43. To bind the partners by an assignment of all the effects underhand and seal, or for any other purposes than within the objects of their trade, the whole of the partners must join. The Bankrupt Laws of England do not extend to the colonies', nor does it comprehend the King, he not being mentioned, Kennedy’s Bankrupt Law, 95. It has repeatedly been decided, that a foreign discharge under a foreign Bankrupt Law, is no discharge in England. They do not notice foreign Bankrupt Laws at all. Smith vs. BuCh-annan, 1 East 6 ; 20 John. 260. It is but just that there should exist a proper reciprocity; — They do not regard our Bankrupt Laws, and therefore it w'ould be unreasonable that theirs should be enforced here. But it was clear that the Bankrupt Law of England was merely a territorial law. The Bankrupt Law of England was never in force in the United States, nor had any effect her% notwithstanding what Lord Thuiiow has said. 5 Cranch ; M’Millan vs. M’Neal, 4 Wheaton, 212; Topham vs-Chapman, 1 Constitutional Rep. 283. The only exception to this rule was the opinion of Chancellor Kent in Holmes vs. Ranselm. In Ogden vs. Saunders, 12 Whea-ton, 364, the opinion of a majority of the Supreme Court of the United States coincides with Topham vs. Chapman, and denies the operation of the English Bankrupt Laws .in the United States.
    
      Petigm, same side.
    Topham vs. Chapman had settled the law as to the operation of the Bankrupt Laws of a foreign country. In one clause of the Bankrupt Act a provisional assignment is provided for. Kennedy’s Bankrupt Laws ■-, and such assignee is bound to re-assign to the assignee under the commission; and all transfers since the first act of Bankruptcy are void. In Holmes vs. Ranselm, neither Ch. Kent nor Justice Pratt looked upon the appointment of a provisional assignee as any thing. It was only to give further effect to the commission of Bankruptcy; and so it is considered in Dutton vs. Morrison, 17 Yes. 193. If Crowder & Clough had refused to make this provisional assignment in England they would havebeen coerced by the Courts there,and therefore such assignment could have no other operation than the general assignment under the commission. But upon broader principles it was clear that the assignment in England Could have no effect here. In Fox vs. Hanbury, 2 Cowp. 445; ll Yes. í-, Esparte Williams; Crawshay vs. Col-lilis, Í5 Ves. 218; Crawshay vs. Mall, 1 Swanston, 506, it is said that the Bankruptcy operates as death, and dis • solves the co-partnership; and the question was, by what mode of reasoning the partners in England could divest Clough of the effects of his possession in America.— After the dissolution, it is a familiar principle that one partner' can do nothing to bind the others. Righ-son vs. Pillen, 1 Starkie, 375; Kilgore vs. Finleson, 1 II. Black- 155; 1 M’Cord, 16, A partner can only claim his share on settlement of accounts, and his assignee cannot be placed in a better situation.' The as-signee of one partner under Bankruptcy, can Only be a tenant in common of an undivided moiety, subject to all the rights of the other partner. Suppose then that we could notice the Bankrupt Laws of England, Crowder & Perfect in England, or their assignees could only be considered as tenants in common with Clough in America. The adversaries roust make out that Crowder & Perfect could, after the dissolution, being only tenants in America with Clough, have perfect controul over the whole of the funds, and perform acts not within the scope of the co-partnership. In Bolton vs. Chatzel, this Court has decided that the effects of one partner could be attached, and the whole of the money ordered to be paid over. By this authority the American assignment must carry the whole effects assigned. But another objection to the assignment to Case was, that the assignment was of effects in America bytwo partners in England, the effects being in the possession of a third partner in America.— This surely was. not within the scope of their business. From the very constitution pf their partnership, the funds in America were within the controul of Clough, and the effects in England under the controul of the English partners. Only conceive of John Robinson’s appearing in the King’s Bench and claiming the property there under an-assignment made by Clough. The Attachment Law here is as much to be respected as the English Bankrupt Law. He held it would be utterly ridiculous if Mr. John Rob-intson were to attempt any such thing. Suppose he had gone even before the Bankruptcy of Crowdér and Perfect? The Courts would there have regarded it as a nullity; for it would there be ipso facto an act of Bankruptcy and void.. Dickerson vs. Legare, 1 De Saussure, 537, was a direct authority in point, decided by Chancellors Mathews and Rutledge. One partner there executed an assignment while in England of all of the co-partnership-effects.— The Court said to sanction such conduct, would be to cut up commercial transactions by the root, by putting it in the power of any partner to ruin the others in a moment-Pending the partnership, each has a right to dispose of the stock in the ordinary way of. commercial business, and after the dissolution to'settle the affairs in the ordinary way.
    Gowon Partnership, 283, (312 of the American Edition.) After the dissolution, the partnership still exists so far as to winding up the affairs in the ordinary way; as to other matters they are mere tenants in common, and have no right to exclude each other from participating in the settlement of the affairs. But if an English partner, by an act of this kind, can sweep away the funds from an American partner, how can it be said that he is not excluded from the possession of the effects and participation in the settlement of the-affairs ? How could he or his creditórs.in America interfere in England ? It is no easy matter to prove a case in England. But even there the assets-in America would be applied by one rule, and the assets.in England by the rule in England, and the rnle as to the domicil would govern, and therefore as far as creditors are concerned it is a matter of great importance where this distribution is to take place. In the case of -Le Chevalier, Douglass 170, Lord Mansfield held, that Lynch a plantation man from St. Christophers dying, his effects were subject to the laws of that Island, and they were distributed accordingly. Suppose the assignment here had been made under the Bankrupt Laws of this country, would not such assignee effectually hold the fund ? And if Lord Thurlow had considered what Lord Mansfield had held, he would not have expressed his sur* prise that the Bankrupt Law of England had been respected in America. Gow 83, Harrison vs. Jackson, 7. T. R. 203. In Dutton vs. Morrison, there was a deed by two partners, and no one in that case ever considered it as conveying any interest of the partner who did not execute it. The only case upon which th,e opposite side could rely was that of Harrison vs. Sierre}’, which he conceived in his favor, it came’ within the rule of those cases where the rule of the domicil governed. This case was just the reverse. J. B. Clough rvas authorized there to raise money on the funds in America under his controul, though two of the partners were absent in England, he being considered their agent for that purpose in America. Crowder & Perfect-were under bonds, and under the control of a messenger when they executed their assignment, and he believed any man would rather be' a prisoner of war for a whole year, than be a Bankrupt in prison for one month. The act of Clough, in America, was within the very scope óf his agency. The case agrees preeisely with the case of Dickerson and Legare, and no’t with Sterrcy and Harrison.
    
      Hunt, in reply.
    Many important paits of the case had been passed by. This was a question between the attaching creditors of the firm of Crowder, Clough & Co. and the assignees of the firm, under an assignment made by two of the partners, before Bankruptcy, resident in England .--An act which they were fully authorized to ■do, He admitted the rule, that Bankruptcy doeá not effect property beyond the realm; and therefore it would not effect the English assignment of the property in question. Bankruptcy is in invitum — it is not voluntary. It is coerced, and therefore its operation can. only extend to the territory.. An'd though thé commission acts as if executed at the'time of the first act of Bankrupt, yet it would create the assignee of any intermediate assignment a trustee for the commissioners of. Bankruptcy, But as it cannot .operate beyond the territory, as an act under the' statute, yet it is good as a deed ,at Common Law. — * The deed is only void as far as in conflict with the Bankrupt Law, and therefore good as a foreign effect, and it was only necessary on his part to cite ’Harrison vs. Ster-ry. In point of fact neither of the partners were in South Carolina, or the attachment would not hdve issued. They were all absent then, and the question was between the attaching creditors and the assignees of. two; and in Harrison vs. Sterry, the assignmentof onewas held sufficient. The simple question was, whether the effects were in the assignees, or in Crowder, Clough & Co. at the ¿ime they were attached. Clough, it is said, was in the United S tates ; but he might as well have been in India so he was not in Carolina. He apprehended the law was, that after diss.olution no new contract could be made — -no new liability could be created by one partner. It was only where one co-partner complained that such exception could be made to the acts of a co-partner. But here Clough had consented to the act, and third persons cannot interfere or complain.
    As . to the seal. — He thought that putting a seal to a contract could not avoid that which was good without seal. The assignment at Liverpool was made as a transfer subsequently agreed to by the other partner for the payment of the co-partnership debts, which was nothing laore than their duty, at the time, and witbin'the scope of their duties and authorities. Independent of the Bankrupt Laws of England, an assignment to John Robinson would have been perfectly good in England, if the rights under their Bankrupt Lavvs had not previously vested.— So thé attachments here wont take, if they were prior to the assignment in England.
    As to the argument that the Bankruptcy dissolved the co-partnership, it was only necessary to say that it only did so as to the funds it operated upon, and not upon' the funds or firm in America. Case received his assignment sometime before the attachment and had appointed Mr. Lance as his attorney, here, to take’possession of the funds so assigned, which divested all interest of Crowder, Clough & Co., The assignment was in favour of all the creditor’s rateably and proportionably in England and America. The Bankrupt Law, cited from Kennedy, was passed since these transactions, and of course they were to be governed by the previous state of the law.
    Lance, same side.
    A previous voluntary assignment takes priority of an attachment — 8 Wheaton,-168, 288; Holmes vs. Ransenlm, 4 John. C. C. 489; 6 Binney; 1 Bay, 88. The act by a majority of the partners, is binding on the minority — Kirk vs. Hudson, 3 John. E. R. 405-6. A co-partnership is there, considered as a little community, the majority of whom must govern, as in other communities. It has been decided that an assignment by one partner is good against the others. 5 Com. Dig. 88, (assignment, title merchant); Mills & Stuart vs. Barbour, 4 Day, 428. In this last case, a deed which a partner cannnot make is defined to be a deed which at Common Law would, not be efficacious without a seal. But the law of this State does not require that an assignment should be under seal. It has been decided here, that the assignment of a bond need, not be under seal. The reason of the law, that one partner cannot bind the-others under seal, is because it was not within the objects of the co-partnership. 4 Bac. Tit. Merchant, Letter C. C08. So in the case of a bond, it would be void, because it gives liens, and is not within the usual transactions of merchants. But there are exceptions to the general rule— 5 Comyn, p. 88. A release under seal by one partner of a debt due the partnership, is binding on all the parties. What was this but a release ? If these two parties could execute a release of the effects of the firm, could they not assign them? The creditors here can come in under the assignment in England. Thr Chancellor had so decided it as to a house in New Orleans. One partner may often act for the whole — Exparte Mitchell 14 Ves. 591; Gow, Part. 91, 96. If the party is not put to a liability beyond that to which he was subject, before the seal is affixed, affixing the seal win not avoid the act. It must be a fresh burthen, laid on by deed, which exempts the co-partner from responsibility to a deed madeby a co-partner. In Harrison vs. Sterry, an objection of this sort against the assignment was not regarded by the Court as worth answering. The Chief Justice was of opinion that it was a transaction within the scope of their transactions as partners.
    By the English Law, this assignment is just as valid as an assignment under a commission of Bankruptcy — 9 Ves. 407. The assignment was equivalent to a delivery of the goods. A partial assignment is not an act of Bankruptcy — it must be a general assignment. -■ — , 2 Mad. 541. In page 633, the writer observes, that debts in America pass by the assignment under Banhrupt-cy, but the Chanceller cannot compel the Bankrupt to assign effects in America.
    The special verdict does not state an act ófBankruptcy by stopping payment, &c. 2 Black. Com. 219. The question a° <o what is Bankruptcy,is a question of law; 4 John. 47T.
    
      in Watson, on Partnership, 257, it is said,'the legal property is in the Bankrupt, until the legal assignment by the commissioners. The act of Bankruptcy then did not divest Crowder, Glough & Co. until the assignment was ■actually made by the commissioners.
    As to. to the case of Dickerson vs. Legare, it was decided on the merits of the cause. The person who assigned was under duress. The assignment was of the whole property of the firm of which he was a member, not to pay ali creditors, but the assignee-alone, and therefore to the prejudice of creditors generally. Here the argument was in favour of creditors generally. As to the power of one partner over the copartnership fund, he cited Cow on Partnership, 78. 87.
    
      Harper, in reply.
    The rights of Case are rested on the grounds — 1st. That the assignment was in aid of the proceedings in Bankruptcy. 2dly. That the assignment being voluntary, and prior in point of time to the attachment, takes precedence.
    The 1st is casus judicatus, Topham vs. Chapman. It is a well settled rule of' law, that foreign law shall not operate here to the prejudice of our citizens; and altho’ the party may act himself under the compulsion of the •law, yet in effect it is the act of the law and not of the ■party. — Hunter vs. Pots, 4 Term.
    The 108th section of the Bankrupt Law makes it a felony, and subjects the. offender to imprisonment or transportation, if he refuse to assign all the-' goods, &c. in his hands, power and possession. In the case cited from Cox’s Rep. the Court sky that they, will not attach the Bankrupt for refusing to assign foreign debts ; but if it is once understood that the object may be.effected by a voluntary assignment, no Chancellor will ever hereafter discharge a Bankrupt until he make such, assignment, and thus our laws will be evaded and our citizen's deprived oí‘ tlieir fights. Under the Bankrupt Laws, the Bankrupt may be discharged by the consent of a certain proportion-of their creditors in number or value, and will they ever give that consent without such assignment ?
    In Holmes vs. Eanselm, the fact did not appear that the-assignmcnt was made in fraud of the law'. But it is impossible in this case to draw any other conclusion from the facts in this case, than that the assignment was either in aid of the Bankrupt Laws, or in fraud of our laws by withdrawing the funds. The property is divested from the act of Bankruptcy, IKen. 120.
    This rule is modified by the 78th section of the Bankrupt Laws, which provides that all transfers, &c. that are 'made within two months before issuing commission, are .good unless the party had notice of the act of Banruptey. The necessary inference is, that all transfers made in that time are void. In 2 Huber, b. 1, Tit. 11, itis said, contracts made in one country, have their effect elsewhere, according to the law's of that country, except when it is to the prejudice of the citizens of that country. The theory of the law is that, as to personal chattels they attend the person, and may be supposed to be actually transfei’red. Here is a contract executed in England by subjects of that country, and it can take effect only according to the laws of that country; and according to the rule the operations of those law's shall not work a prejudice to our own citizens.
    This assignment contain trusts, and by the Laws of England the King is entitled to a precedence, and under their operation the trust would be wholly defeated. So if the assignee carried the fund into England, it would be subject to the operation of the Bankrupt Law. It follows that the lex loci will in general be operative here, and we should be compelled to carry them into effect in every case, go far as the partners are concerned, but there is a ¡saving in favour of our own citizens. Whether the legal estate remained in the Bankrupts after the act of Bankruptcy, or not, is immaterial, if in the Bankrupt it was the subject of attachment.
    The act of Bankruptcy is a dissolution of the firm, and therefore the act of one or more could not bind the firm. It docs not follow that all the partners were Bankrupts. Now admitting that in general they might do so non con-stat, that he could do any act by which his rights could be altered or changed.
    It is clear then that the ássignment is void, because it was made in aid of the Bankrupt law. It is void, because by the act of Bankruptcy the right vested in the assignees of the commissioners. It is void, because two partners were not competent to make it so as to bind the other ; and because it is under seal.
    Watson on Part. 91. — Each partner has an absolute right to dispose of the whole stock in the way of trade. But it is denied that this power extends so far as to enable one or more of a firm to put an end to the concern, and such would be the effect of this assignment.
    4 Yes. 399 — The individual is lost in the firm, and when they act individually they stand in the relation of agent to the firm, and no one will contend that an agent can put an end to the concern, or change the nature of the business.
    The case of Harris vs. Sterry differs from this. There the assignment was of a part of the funds only. It is expressed to have been for the purpose of enabling the firm to go on with their business, and to save their credit.— Fox vs. Hanbury, Cooper 445,17 Yes. 193, 205; 4 Yes. 396. — This deed or assignment does not in its effect convey any thing; the trust is for the benefit of the firm. The rights of the trustee are merely legal.
   Cuma per

Johnson, J.

The: facts ascertained by the special verdict, stated in their .chronological order, are con-, cisely these. The defendants, Thos. Crowder, Henry Thomas Perfect and Jas. B. Clough,,-all British subjects were partners in trade. The two .former, Crowder and Perfect, resided in Liverpool, England, and' the,latter,. Clough, in Charleston, South Carolina, and carried on business at these places respectively, under the firm of Crowder, Clough & Company. On the Sth Aug., 1825,, the House in Liverpool committed an act of Bankruptcy, and on the 20th day of the same month, - Crowder and Perfect executed an assignment in the name of Crowder, Clough & Co. under their hands and seals, to Thos. Case, of all and singular the.debts, estates an& effects of the said Crowder, Clough & Co. within the United States in trust for all the creditors of Crowder, Clough & Co. rateably, and shortly after a Commission of Bankruptcy issued in England against the said Thos. Crowder, and Henry Thos. Perfect. On the 19th Sept, of the same year, and shortly after these proceedings were had, the plaintiffs and others claiming to be creditors of the said Crowder, Clough & Co. and residing here, sued out writs of attachment, which were levied on their effects, estates and credits which were found here. At this time Jas. B. Clough had-left this-State, but was still in the United States, and on his going to Liverpool afterwards, a Commission of Bankruptcy issued against him also there on the 10th June, 1826. On the return of the attachments, Thomas Case, through his attorney in fact, interposed his claim to the effects so attached, and the question now submitted, is, whether he is entitled to them under the deed of assignment so made. If he is, it follows that the plaintiffs take nothing by their attachment; if not, then of course this motion must prevail.

This as a question of international law, is in itself, 'highly interesting, but is rendered more so by the zeal and ability which it has elicited from the counsel on both sides, and the learning which has been put in requisition. By recurring to the facts stated, it will be seen that the ‘Commission of Bankruptcy against Crowder and Perfect was prior in point of time to the plaintiffs attachment, and the question has been raised, but not with much confidence, that the proceedings in bankruptcy operated as a transfer to the Commissioners of all the property which belonged to Crowder, Clough & Co. wheresoever it might be found to the exclusion oí the subsequent attaching creditors. But the case of Topham vs. Chapman, 1 Const. Rep. 229, is decisive of that question. In that case, the question arose directly beiween the assignees of a bankrupt in England, and attaching creditors here, and although the attachments were issued subsequently to the suing out of the commission of bankruptcy, the Court held that it did not create such a lien on-the property here as gave it the preference over the liens created by the attachments of the attaching creditors, and that judgment is, I think, very fully sustained both by principle and authority.

A question of more difficulty arises out of the claim set up in behalf of Case, founded on the deed of assignment, of the 20th Aug, 1825, also prior to the plaintiffs attachments, by which Crowder and Perfect, in the name of Crowder, Clough & Co. have assigned to him all their property in the United Stales.

Independently of the interest which creditors residing here may have in the property assigned, there is no question that as between the parties the assignment would be binding here as well as in England, and supposing it to have been voluntary and binding according to the laws of that country, and nut inconsistent with our laws, the Courts here would upon the well settled principles of universal law be bound to give it effect and operation.

But it is objected for the plaintiffs—

1st. That this assignment being by deed and made by two of the partners only, is not binding on the third and is therefoi’e void.

2nd. That the assignmentwas either in aid of the Bankrupt Laws of England, and calculated to give them an effect here inconsistent with the laws of this country, and therefore void; or that the rights of Crowder and Perfect in the properly assign'ed, vested in the Commissioners in virtue of the proceedings in Bankruptcy, and the assignment was therefore nugatory and inoperative.

As to the first, the books furnish numerous dicta which sustain the position that partners cannot bind each other or the firm of which they constitute a.part, only by deed, but on examination of the cases, it will be found that they relate to transactions that are purely mercantile^ and that they depend on the principle that a partner can do no act which will be binding on his firm, which is inconsistent with or foreign to the object of their association.

Simple contracts, such as promissory notes, bills of ex-' change, open accounts, and others of like nature, are according to usage regarded as mercantile contracts, and the co-partnership is entered into with reference to the powers of each partner to bind his firm in this mode, and for that reason it would seem one partner cannot bind his firm in a penal bond, (Bacon Abr. Merchant, C.) nor can he transfer the real estate of the firm used for the purposes of carrying on business by deed, because it might in effect, defeat the object of partnership. (Ibid.) If, however, the buying and selling of lands and other real estates which can only be transferred by deed, was the -object of the co-partnership, no one will doubt but that a partner might bind his firm by such aii instrument.

I apprehend too, that where a seal will not change or vary the liability and is not essential to the nature of the contract, that then also the addition of a seal will not vitiate it; as in the case of a release, in which the authoi'ities all agree that it is good, notwithstanding the addition of a seal; (Com. Dig. tii. Merchant, D. Days Ed. note H, sec. 151, where the cases on this subject are collected,) and they proceed on the principle that the release inde-, pendently of the seal contains intrinsic evidence of the payment of the debt, and is therefore good against the firm.

Again, let us suppose that at the foot. of a bill of parcels a partner had acknowledged in the name of the firm and under seal, that in consideration of a sum specified he had sold and delivered to his customer the goods therein contained, would it be doubted that such a memorandum would be a good bar to ail action brought by the firm for the goods themselves or their value ? Í think not.— And it appears to me very clearly, that if Crowder and Perfect were in other respects competent to make the as-' signment in question, it is not vitiated by the presence of a seal. In the case of Harrison vs. Sterry, 5 Cranch, 300, it was held, and I think on very sound principles, that an assignment of funds for the payment of debts, was in the coui-se of trade. Indeed every partial application of funds to the payment of debts, whether it consists of cash, or goods, or any thing else, is in effect an assignment for that purpose and binds the firm. And if in the course of things, a general assignment becomes necessary, there can be no reason why it should not be equally binding. The principle is the same whether it be partial or total, and it follows that in either ease onq may bind the whole.

It is said, however, that the assignment was not obligatory on Jas. B. Clough, the partner resident here, and I concede that as between themselves, Crowder and Perfect had no control over the interests of Clough, and that their assignees could only take theirinterest in common with' Clough, but this was an appropriation of the whole funds'of the concern to the payment of. all their debts, and whether he had any interest or not must depend .on a surplus remaining after the payment of the debts. The whole was applicable to that object, and if the whole was necessary, he was bound to that extent.

The remaining questions’which I deem it necessary to notice, arise out of the second objection above stated. It is that the assignment was in aid of the Bankrupt taws of England, and calculated to give them an effect here, inconsistent with the laws of this country, and therefore Void; or that the rights of Crowder and Perfect in the property assigned by virture of the proceedings in Bankruptcy were vested in the Commissioners and by relation back to the act of Bankruptcy, and the assignment was’, therefore, nugatory and inoperative. It has been before shewn that in the conflicting' operations of .the English Bankrupt Laws and our Attachment Laws unaided by extrinsic circumstances, the latter would take the precedence of the former as between the assignee of the Bankrupt and the attaching creditors, and it follows as a necessary consequence that if this assignment was a constituent part of the proceedings in Bankruptcy and was in aid of the Bankrupt Laws, that it cannot- have an effect of itself either inconsistent with or. to an extent beyond the law itself. Now there are many circumstances connected with this assignment, which favor the conclusion that it was intended to aid the operation of those, laws. It was made after a notorious act of Bankruptcy, and is In its .terms merely provisional, evidently with an eye w> the consequences which followed.. Being an assignment for the benefit of all creditors rateably, it was in, itself an act of Bankruptcy; and by the laws of England such an assignee is held to be a trustee for the assignees under the Commission of Bankruptcy.

The terms of the English Bankrupt Laws which entitle the Bankrupt to his discharge, is a general and unqualified surrender of all his property, and unquestionably extends as between himself and the assignees to property in a foreign country; and if assignments executed under circumstances like these are to have the. effect and operation contended for on the part of Case, they would soon grow into common use and thus give an effect to those laws which are denied to them by the well settled principles of international law.

The alternative contained in the objection above staged, is, I think, equally Conclusive against the claims of Mr. Case. There is no doubt that under the former statutes of Bankruptcy, the assignment by the Commissioners vested in the assignee all the property of which, the Bankrupt was possessed, and that too in relation back to the act of Bankruptcy, by avoiding all intermediate transfers, (Com. Dig. Tit. Bankrupt D. 26,) and the recent act under which these proceedings are said to be the first that were had, makes no change which can affect the question under consideration. By, the 78th section,, all transfers of property, &c. made more than two months; before suing out of the Commission and without notice of the act of Bankruptcy are declared to be valid, leaving the law with respect to those made within that period; as it stood before, and by necessary implication avoiding all made within that period, (Kennedy’s Bankrupt Law.) The act of Bankruptcy in this ease was committed on the 8th August, 1825, and although the special verdict does not ascertain the day on which the Commission was issued, it was prior to the suing out of the attachments o£s the 29th September following, and the assignment having been made between these periods, was necessarily within two months' of the suing out of '.the Commissions and was therefore void, unless it was to be regarded as in aid of the Bankrupt Laws, the consequences of which, have been before noticed. Notwithstanding the difficulty in whieh the question has been involved and the apparently conflicting opinions whieh have been entertained in relation to it, I .think I may venture safely to lay. it down as well settled law, that the. proceedings under the Bankrupt Laws.of England transfer to the assignees all the interest which the Bankrupt had in the property' assigned whether it was found in England or in this dr any other foreign country. In support of this position it might perhaps be sufficient to rely only on the case of Topham vs. Chapman before referred ip, in which upon a review of most of the cases it is conceded to the extent necessary for the purposes of this case and in which my brother Nott, who delivered the opinion of the Court comes to the conclusion that by the' assignment, all the goods of the Bankrupt ubieunque fuerint vest immediately. in the assignees. I will add to this, however, another case of more recent occurrence, and which has also a strong bearing on a branch of this case before noticed. In Holmes vs. Remsen, 20 Johnson, 259, Mr. Justice Platt after a very laborious and learned investigation of the doctrine and all the cases on the subject, reasons himself to the same conclusion. He observes “ that the true principle is that the assignees of a Bankrupt are on the same and no better footing than the Bankrupt himself in regard to foreign debts. They take subject to every Equity and subject to the remedies provided by the Laws of the foreign country where the debts are due, and when permitted to sue in foreign countries it is not as assignees having an interest, but as representatives of the Bankrupt.” In the case of Hunter vs. Potts, 4 Term. Rep. 182, the doctrine was carrried so far, that a creditor residing in England, who had attached the money of a Bankrupt abroad was in an action brought against him on his return, to England, held to be liable to the assignees as for money had and received to their use.

The deductions from these views necessarily lead to the conclusion that regarding the assignment as in aid of the Bankrupt Laws of England, it can have no effect beyond the law itself, and that under the proceedings in Bankruptcy the legal right in the property vested in the assignees as between them and Crowder, Clough & Co. by relation back to the act of Bankruptcy; so that in any view of the matter Case took nothing under the assignment, and led the Court to the adoption of the order made in the cause at the last term. The motion is granted and leave given to the plaintiff to enter up judgment on the special verdict. Judgment reversed.