Case ID: haw_1/html/0108-01.html
Source: Caselaw Access Project
Author: {"author": "Chief Justice Lee", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

JULY TERM, 1853.
    ASSONG vs. SHOUGHING.
    One partner has no right to apply the partnership property to the payment of his own debts, without the consent of the other partners.
    This was an action on a promissory note for $1,100. The defence set up was fraud. Yerdict for defendant.
    In the trial of the above cause the question arose as to the right of one partner to apply the partnership funds, effects or property, to the payment of his own private debts.
    Mr. Montgomery for plaintiff.
    Mr. Bates for defendant.
   Chief Justice Lee

charged the jury that one partner had no right, as a general rule, to pay his debts with partnership property, because it was going beyond the scope of the partnership business — it was a misapplication of the partnership effects, which no member of the firm could make without the consent of all the other members; and in such cases the creditors dealing with the partner, and knowing the circumstances, will be deemed to act mala fide — in fraud of the partnership, and the transaction wilt be treated as a nullity.

Mr. Montgomery and Mr. Blair, for plaintiff.

Mr. Bates for defendant.