Case ID: ohio-st_51/html/0300-01.html
Source: Caselaw Access Project
Author: {"author": "Dickman, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Byers v. Schlupe et al.
    
      Attachment — Non-resident partnership — Service of summons on.
    
    1. In a civil action for the recovery of money, the plaintiff may, on the ground that the defendant is a non-resident of this state, have an attachment against the property of a defendant partnership of which all the members reside outside this state, which was formed for the purpose of carrying on business in this state, and which has a usual place of doing business in this state.
    2. In an attachment against the property of such a non-resident partnership, it may be sued by its company name, and service may be had by leaving a copy of the summons, with the indorsements thereon, at its usual place of doing business in this state.
    (Decided April 24, 1894.)
    Error to the Circuit Court of Marion county.
    This petition in error is prosecuted by Alexander M. Byers, plaintiff: in error, against Samuel Schlupe, assignee of The New Philadelphia Pipe Works Company, Ezra Nicholson, The Cleveland, Lorain & Wheeling Railroad Company, Timothy Fahey, Bryan and Prendergast Brothers, W. and J. F. Prendergast, H. T. Van Fleet, Samuel R. Bullock'& Company, and numerous others, defendants in error, from the circuit court of Marion county, Ohio, upon a finding of facts and conclusions of law as made, by that court. The parties plaintiff: and defendant were the same in the circuit court as in this court.
    The finding of facts and conclusions of law are as follows:
    “This day came the papties and with their attorneys, and this cause came on to he heard upon the respective pleadings filed herein, and the evidenee; upon consideration thereof and upon application of said plaintiff, the court do find from the evidence the following facts, viz.: That the funds now in the hands Of the sheriff, to-wit: $5,100.00, arose from the sale of the personal property of the partnership firm of Samuel R. Bullock & Company, upon an order of sale for that purpose duly issued herein by consent of all parties hereto; that on the 30th day of August, A. D. 1887, the New Philadelphia Pipe Works Company, a party herein, commenced an action in the .court of common pleas of Marion county against the said Samuel R. Bullock & Company in their firm name, and none other, and for the purpose of procuring an order of attachment accompanied the filing of the petition with an affidavit, alleging in said affidavit the following facts and none other: ‘ Ezra Nicholson being duly sworn, says that he is the secretary and treasurer of the New Philadelphia Pipe Works Company, an incorporated company under the laws of the state of Ohio; that the claim sued upon in the action was upon a contract for an amount of water pipe sold and delivered to said Samuel R. Bullock & Company, a partnership formed for the purpose of doing business in Ohio; that said claim was just and that affiant believes the said The New Philadelphia Pipe Works Company ought to recover $29,947.04 and interest from August 20, 1887; that the defendants are nonresidents of the state of Ohio.’ Upon said affidavit an order of attachment was issued to the sheriff of said county, which was received by him and was on the same day levied by him upon the personal property sold aforesaid.
    “That afterwards, on the same day Timothy Eahey commenced an action in said common pleas court against said Samuel R. Bullock & Company upon a claim which, was not at that time due, accompanying the filing of his petition with an affidavit, alleging in said affidavit the following facts and none other: ‘Timothy Pahey being sworn according to law, deposes and says that he has commenced an action against the said Samuel R. Bullock & Company in the court of common pleas of Marion county, Ohio, to recover on a certain bill of exchange, drawn by the said Samuel R. Bullock & Company; that said claim is just, and that the same will become due on the 11th day of September, A. D. 1887, and that there will then be due upon the same the sum of $2,500, and that the said Samuel R. Bullock & Company has sold and conveyed and disposed of its property with fraudulent intent of hindering and delaying its creditors in the collection of their debts, and that said Samuel R. Bullock & Company is about to move its property out of said county of Marion, to the effect of hindering and delaying its creditors in the collection of their debts;’ that at the same time an order of attachment was duly allowed in said action by the Honorable John A. Price, one of the judges of said court upon the said Timothy Pahey, giving- bond in the sum of $5,000, to the satisfaction of the clerk of the court of common pleas of Marion county, Ohio, conditioned according to law; which order of allowance was duly entered upon the journal of said court; that at the same time the said Timothy Pahey executed his bond as provided in said order of allowance to the acceptance of said clerk; upon said affidavit, allowance as aforesaid, and giving bond aforesaid, an order of attachment was issued to the sheriff of said county, which was received by him and was on the same day by him levied upon the personal property sold as aforesaid.
    “Afterwards, upon the same day, an action was commenced by Bryan and Prendergast Bros, against Samuel R. Bullock and William S. Mercer, partners, as Samuel R. Bullock & Company, and accompanied the filing of the petition herein with an affidavit, alleging in said affidavit the following facts and none other: ‘James F. Prendergast being duly sworn, says that he is one of the above named plaintiffs who are partners doing business under the firm name of Bryan and Prendergast Bros; that .the defendants are indebted to said plaintiffs on an account for goods sold and delivered to defendants at their request; that said claim is just; that the amount which said plaintiffs ought to recover from said defendants, as affiant believes, is one hundred and one dollars and ten cents, with interest from the 30th day of August, 1887, and that said defendants are non-residents of the state of Ohio.’ Upon said affidavit an order of attachment was issued to the sheriff of said county, which was received by him, and was on the same day by him levied upon the personal property sold as aforesaid.
    “Afterwards, on the same day, W. and J. F. Prendergast commenced an action in • said court against Samuel R. Bullock & Company, and accompanied the filing of the petition therein with an affidavit, alleging in said affidavit the following facts, and none other: ‘Jame'; F. Prendergast being duly sworn, says that he is one of the plaintiffs in the foregoing action; that the said plaintiffs are partners doing business under the firm name of W, & J. F. Prendergast; that the defendants are a partnership firm formed for the purpose of doing, business and holding property in the state of Ohio, and the usual firm name which they have assumed is Samuel R. Bullock & Company; that the said defendants are indebted to the said plaintiffs on an account for goods sold and delivered to defendants at their request; that said claim is just; that the amount which plaintiffs ought to recover, as affiant believes, is one hundred and thirty-four and 67-100 dollars, with interest from the 29th day of August, 1887; and that said defendants are non-residents of the state of Ohio; ’ upon said affidavit an order of attachment was issued to the sheriff of said county, which was received by him, and was on the same day by him levied upon the personal property sold as aforesaid.
    “Afterwards, on the 7th day of September, 1887, The New Philadelphia Pipe Works Company filed an amended petition in said case and accompanied the same with an affidavit, alleging in said affidavit the following facts and none other: ‘Ezra Nicholson being’ first duly sworn, says that he is the agent duly authorized for the plaintiff in this action, which is a corporation organized under the laws of Ohio; that the defendants, who are a partnership organized for the purpose of doing business and holding property in Ohio, are indebted to plaintiff on a contract for the sale of certain per- ■ sonal property and goods, to wit: iron water pipe and special casting; that the amount of plaintiff’s claim is twelve thousand one hundred and fifty-six dollars in addition to the amount now due to plaintiff; that said $12,156.00 will become due September 20th, 1887; that said claim is just, and that said defendants are about to make a sale, conveyance and disposition of their property with the fraudulent intent to cheat or defraud their creditors, and to hinder and delay them in the collection of their debts; that said defendants have purchased of plaintiffs and other parties large quantities of valuable property, the ownership of which they now disclaim, alleging and pretending that all said property or the greater part thereof is owned by a certain corporation called the Marion Water Works Company, organized at the instance of said defendants, and that said attempted transfer of title to such property is 'undertaken by defendants while they are still indebted to plaintiff in a. very large sum for the greater part of the very property so attempted to be disposed of and thereby placed beyond the reach of creditors.’
    “And thereupon another order of attachment was issued from said court and levied upon said property;' and afterwards, on the 11th day of November, 1889, a second amended petition was filed by the plaintiff in said cause, and with it there was filed an affidavit, alleging in said affidavit the following facts and none other: ‘ Thomas C. Willard being duly sworn, says that he is the Secretary of the New Philadelphia Pipe Works Company, a corporation duly organized and doing business under and by virtue of the laws of the state of Ohio; that the defendants, Samuel R. Bullock and William S. Mercer, were lately partners, doing business under the firm name and style of Samuel R. Bullock & Co.; that said defendants are indebted to said plaintiff upon a contract for iron pipe and other castings; that said claim is just, and that plaintiff ought, affiant believes, to recover the sum of twenty-four thousand one hundred and three and nine one-hundreths dollars, with interest at six per cent; eleven thousand nine hundred and forty-six and seventy one-hundreth dollars, from August 20th, 1887; and on twelve thousand one hundred and' fifty-five dollars from September,, 20th, 1887; and that said defendants are non-residents of the state of Ohio. ’ An order of attachment was issued thereon, which was also levied upon said property. That at the February term, A. D. 1889, of the court of common pleas aforesaid, the said The New Philadelphia Pipe Works Company obtained a judg-ment against the said Samuel R. Bullock & Co. upon the cause of action alleged in its petition and amended petition, in the sum of twenty-five thousand one hundred and eighty-seven dollars and ninety-five cents; that at the May term, A. D. 1888, the said Timothy Fahey obtained a judgment against the said Samuel R. Bullock & Company upon the cause of action alleged in his petition, in the sum of two thousand six hundred and twenty-one dollars and twenty-five cents.
    “That at the January term, 1888, the said Bryan and Prendergast Brothers obtained a judgment against the said Samuel R. Bullock & Company upon the cause of action alleged in their petition, in the sum of one hundred and three dollars and eighty-eight cents. That at the January term, A. D. 1888, the said W. and J. F. Prendergast obtained a judgment against the said Samuel R. Bullock & Company upon the causé of action alleged in their petition in the sum of one hundred and thirty-eight dollars and thirty-four cents.
    “That prior to the October term, A. D. 1888, of the court of common pleas of Marion county, • a large number of judgments were obtained by certain laborers against the said Samuel R. Bullock & Company, and were each asserting liens upon the personal property sold as aforesaid, and iñ the case of The. New Philadelphia' Pipe Works Company against Samuel R. Bullock & Company by consent said laborers, represented by one H. T. VanEleet, were made parties defendant, and between said parties such proceedings were had, that at the October term, 1888, of the said court, the court made the following order and decree;
    “This day this cause came on to be heard upon the answer and cross petition of the defendants, Jacobs. Brady and others (laborers represented by H. T. VanFleet), and the evidence, and was submitted to the court; on consideration whereof, and the court being fully advised in the premises, find for said defendants, and that their claims are for labor performed for the defendants, Samuel R. Bullock & Company, and that they are valid liens upon the property taken in attachment in this action, and first in order of priority; ’
    “That at the February term, 1889, of said court ■of common pleas, the court made the following decree : ‘It was agreed by the parties, plaintiff, and said defendant, Alexander M. Byers, that the labor, claims of the seventy-seven' defendants heretofore found to be the first lien on the property attached in this case as against the said plaintiffs be and the same by agreement and confession made in open court, declared the first lien on said property so attached and in controversy in this cause, as against any claim, rights, demands, legal or equitable of said Alexander M. Byers;’ that each of said orders and decrees remain in full force and effect; that on the 28th day of November, A. D, 1887, the said The New Philadelphia Pipe Works Company assigned the one undivided fourth part of its claim against Samuel R. Bullock and Company to one Ezra Nicholson, by a written transfer, in the words and figures following, to-wit: ‘ The New Philadelphia Pipe Works Company hereby assign and transfer to Ezra Nicholson an undivided one-fourth part of all its claim against the late firm of Samuel R. Bullock and Company, which claim is now in suit in the court of common pleas of Marion county, Ohio, and also assign one-fourth part of all moneys that may be realized from or upon said claim or out of said suit, through proceedings in attachment, suit or otherwise. * *
    Afterwards it assigned a portion of its claim in said case to the Cleveland, Lorain and Wheeling Railroad Company; assignment was filed in the case of The New Philadelphia Pipe Works Company v. Samuel B. Bullock, but is now lost and was never recorded by the clerk. The amount so assigned was $2,848.43, with interest.
    Afterwards, on the 3d day of August, A. D. 1888, the said company assigned the balance of its claim to Alexander M. Byers by an instrument in writing, of which the following is a copy:
    “For value received, we hereby sell, transfer and assign to Alexander M. Byers, our .claim against Samuel R. Bullock & Company for pipe delivered to them at Marion, Ohio, which claim is now .in suit in the common pleas court at Marion, Ohio, in an action pending, The New Philadelphia Pipe Works Company are plaintiffs, and Samuel R. Bullock & Company et al., are defendants, except so much of said claim as we have heretofore assigned and transferred to E. Nicholson for $5,000, and to C. L. Cutter, Treasurer of the Cleveland, Lorain and Wheeling Railroad Company for $2,848.43 with interest. And we hereby authorize and empower said Byers to be substituted in our place in said action, and to prosecute, adjust and settle the same, and having paid himself the amount now due him from us, being the sum of $16,381.42, with interest; and having paid all costs and attorney’s fees in the prosecution of said case, if there shall be any balance received by him over the amount due him as aforesaid, such balance shall be held subject to our order.”
    “That the said assignment to Ezra Nicholson and Alexander M. Byers was entered by the clerk of said court upon the execution docket of said court. Upon the facts there found, the court do find that the costs made in the case of The New Philadelphia Pipe Works Company against Samuel R. Bullock & Company et al. (No. 4939), is the first and best lien.
    “That the costs made in this action is the second best lien.
    “That the judgment and costs of Timothy Fahey, with interest thereon to the date of the sheriff’s sale, is the third best lien.
    “That the judgment and costs of Bryan and Prendergast Bros., with interest thereon to the date of the sheriff’s sale, is the fourth best lien.
    “That-the judgment and costs of the laborers, represented by II. T. Van Fleet, with interest thereon to the date of the sheriff’s sale, is-the fifth best lien.
    “ That the judgment of The New Philadelphia Pipe Works Company, with interest thereon to the. date of the sheriff’s sale, is the sixth best lien.
    “It is therefore ordered, adjudged and decreed that the said sheriff out of said fund pay : • ‘
    “ First — All costs in the case of The New Philadelphia Pipe Works Company against Samuel R. Bullock & Co., to wit, $663.67.
    
      
      “Second — All the costs of this action, to wit, $344.78.
    
      “Third — To Timothy Fahey, the amount of his judgment and costs with interest, to wit, $2,933.58.
    
      “Fourth — To Bryan and P.rendergast Bros., the amount of their judgment and costs, with interest, to wit, $188.82.
    
      “Fifth — To PI. T. Van Fleet, the amount of the laborers’ judgment and interest, to wit, $3,596.29.
    
      “Sixth — To the assignee of The New Philadelphia Pipe Works Company the amount of the judgment with interest, to-wit, $-. ”
    To all of which the said The New Philadelphia Pipe Works Company, Alexander M. Byers, Ezra: Nicholson, and the Cleveland, Lorain & Wheeling Railroad Company, each then and there excepted.
    
      Marvin & Cook, for plaintiff in error.
    The statute has nothing to do with residence; it provides for service upon a firm — section 5042 — by leaving a summons at its usual place of business. Notice, it does not say at its usual place of residence, but at its usual place of business.
    Now, the law of attachment, section 5521, provides that when the defendant, or one of several defendants, is a foreign corporation, or a nonresident of this state, then this attachment may issue. ,
    The mere fact that they are organized as a firm does not change their place of residence. The attachment law refers to residence. The law in regard to service of summons relates to place of business. It is not the creation of a new being, or a legal entity, but it is the permission awarded by law to the making of service upon the so-called firm at its usual place of business. '
    "We desire the court to give special attention to the position that we take with reference to residence and place of business. Summons may be had at a place of business, but place of business does not make residence; and the first ground of attachment does provide and does support the affidavit named in this case in order to secure the attachment that the defendant is non-resident of the state; and if non-resident, then the attachment was issued with authority of law. Grady v. Gosline & Barbour, 48 Ohio St., 670; 45 Ohio St., 228.
    
      Charles C. Fisher, for defendants in error, who are creditors, also, filed a brief, making substantially the same points as counsel for plaintiff in error.
   Dickman, C. J.

The main question that claims our consideration is, whether the court of common pleas, by virtue of the affidavit which accompanied the filing of the petition of The New Philadelphia Pipe Works Company, on August 30, 1887, acquired jurisdiction and was authorized by law to issue the order of attachment against the property of the partnership firm of Samuel R. Bullock & Company. The action was commenced on the last named day against the defendants in their firm name and none other; and the affidavit in attachment alleged the following facts, and none other: “Ezra Nicholson, being duly sworn, says that he is the secretary and treasurer of The New Philadelphia Pipe Works Company, an incorporated company under the laws of the state of Ohio; that the claim sued upon in the action is upon a contract for an amount of water pipe sold and delivered to said Samuel R. Bullock & Company, a partnership formed for the purpose of doing business in Ohio; that said claim is just, and that affiant believes that the said New Philadelphia Pipe Works Company ought to recover $29,947.04, and interest from August 20,1887; that the defendants are non-residents of the state of Ohio.” The record discloses that the partnership was composed of Samuel R. Bullock and William S. Mercer, and that neither of the individual members of the firm resided in Ohio at the time the order of attachment was issued.

Section 5011, of the Revised Statutes, provides that: “A partnership formed for the purpose of carrying on a trade or business in this state, or holding property therein, may sue or be sued by the usual or ordinary name which it has assumed, or by which it is known; and in such case it shall' not be necessary to allege or prove the names of the individual members thereof.”

By section 5042, of the Revised Statutes, regulating the manner of service and return of summons, it is provided that: “The service shall be by delivering, at any time before the return day, a copy of the summons, with the indorsements thereon, to the defendant personally, or by leaving a copy at his usual place of residence, or, if the defendant is a partnership sued by its company name, by leaving a copy at its usual place of doing business.”

And under section 5521, of the Revised Statutes, among the grounds upon which an attachment may issue, the plaintiff, in a civil action for the recovery of money may, at or after the commencement thereof — if the claim is a debt or demand arising upon contract, judgment or decree — • have an attachment against the property of the defendant,- “when the defendant, or one of several defendants, is a foreign corporation, or a non-resident of this state.”

In view of these statutory provisions, the validity of the attachment called in question must evidently depend upon whether the partnership of Samuel R. Bullock & Company, sued by the firm name only — neither of its members then residing’ in Ohio — was a “defendant non-resident of this state” at the time the order of attachment was issued, within the meaning of the language of the statute.

The privilege extended by the statute to sue a partnership by the usual or ordinary name which it has assumed, or by which it is known, is not to be confined to such as may be formed within this state for the purpose of carrying on a trade or business, or holding property herein. Indeed, a partnership may be formed in another state for accomplishing the same purpose in this state; its component members may all reside in the state where it is formed, and if it does business in this state, it may be sued by its company name, and served by leaving a copy of the summons at its usual place of doing business in this state. It may be thus sued and thus served, irrespective of the residence of those who compose it. ■

The fact, however, that such partnership engages in business in this state, that it may be sued in the company name, and that it may be served by leaving a copy of the summons at a prescribed place, are not the sole factors for fixing and determining its residence when it is sought to reach its property by attachment for the benefit of its creditors. The members of a partnership do not form a collective whole, distinct from the individuals composing it; nor are they collectively endowed with any capacity of acquiring rights or incurring obligations. The rights and liabilities of a partnership are the rights and liabilities of the partners. 1 Lind. Part., 5. It is not a creation in which the identity of the individual members is merg’ed and lost, in seeking- to enforce against them the obligations of the firm.

A partnership is not, in our judgment, a legal entity, having, as such, a domicile or residence separate an d distinct from that of the individuals who constitute it. To what extent residence may be affirmed of a partnership as such, was considered by the court in Fitzgerald v. Grimmell, 64 Iowa, 261. In the dissenting opinion there is much force, and we cite the same with our concurrence : , ‘‘Residence,’’ says Adams, J., “in my opinion can be predicated only of a person natural or artificial. A partnership, as distinguished from the members composing it, is neither. Besides, it appears to me that, in any view, the mere fact that a partnership maintains for the transaction of its business, an established agent in a county where neither partner resides, cannot constitute the partnership a resident of such county. There is no pretense that an individual would become a resident of a county by merely transacting business therein through an established agent, and I am not able' to see that a different rule should be applied to a partnership.”

A principal reason for authorizing a suit against a partnership by its company name, to wit, the inability oftentimes to find out the names. of constituent partners, is applicable alike to domestic and foreign partnerships. In view of such inability —more apt to arise where the partners all reside in another state — the statute specifically provides, that when a partnership is sued by its usual or ordinary name, “it shall not be necessary to allege or prove the names of the individual members” of the firm. Whether the partnership was formed in this state or in another state, the names of the individual members are not required to be alleged ; and whether a defendant partnership should be deemed a non-resident of the state in an attachment of its property on the ground of non-residencé, should depend upon the fact of the non-residence of the constituent members, and not upon the mere mention of names of those who constitute the firm. It being conceded, that the first attachment in favor of The New Philadelphia Pipe Works Company, would have been valid, if the proceeding had been against Samuel R. Bullock and William S. Mercer, partners, as Samuel R. Bullock & Company, with an accompanying affidavit that the defendants were non-residents of Ohio, the failure to allege the individual names of the partnership, should not, we think, render the attachment invalid, when the affidavit states the fact that the defendants were nonresidents of the state, and the statute renders it unnecessary to set forth the names of the partners. As an attachment mayissueon the ground that the defendant is a non-resident of the state, it would seem to be the policy of the law, when the defendants reside in a foreign jurisdiction, and their names are unknown to the plaintiff, and they are doing business in this state under a partnership name, that creditors might protect their rights by attachment proceedings against the defendants in the name by which they elect to hold themselves out to the public, and obtain credit.

It may perhaps be urged, that although the individual partners composing a firm reside in another state, the partnership is to be deemed resident in a state where it has a "usual place of doing business.” But, the statute in prescribing the manner of service and return of summons, recognizes both a place of residence and a place of business. And the one is not to be regarded as identical with the other. A person or a number of persons may be domiciled or reside in one state and have an agent and place of doing business in another, even as a corporation domiciled within the state by which it was created, may have its agent and a usual place of doing business in another state. The principal action may exist, and the partnership, under the company name, maj^ be brought into court through actual service by leaving a copy of the summons at its usual place ofo business, while an ancillary proceeding by attachment to secure the rights of creditors, may be sustained by reason of the fact of non-residence ; and when the attachment issues, it is not necessary that there should be constructive service on the defendants by publication, but there may be service of process at the usual place of business which they have established in this state. Smith v. Hoover, 39 Ohio St., 249.

It follows, from the foregoing considerations, that the affidavit upon which the first attachment was issued in favor of The New Philadelphia Pipe Works Company, was adequate to give the court jurisdiction to issue the attachment, and thereby acquire jurisdiction over the property.

Subject therefore to the liens for costs as adjudged by the circuit court, the claims of the laborers represented by H. T. Van Fleet, should be .held valid liens and'first in order of priority upon the property taken in attachment; but, subordinate to such claims, the judgment in favor of The New Philadelphia Pipe Works Company should be the next best lien upon the property attached, or upon the funds derived from its sale.

The first attachment by The New Philadelphia Pipe Works Company being deemed valid upon the facts set forth in the record, it becomes up-necessary to consider, whether objections to the attachment that may be taken advantage of by the defendants, Samuel R. Bullock & Company, can also'be available to other creditors of those defendants.

The judgment of the circuit court should be reversed, and judgement rendered for the creditors of Samuel R. Bullock & Company in accordance' with the priorities of lien as stated in this opinion.

Judgment accordingly.