Case ID: scl_46/html/0075-01.html
Source: Caselaw Access Project
Author: {"author": "Glover, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

H. W. Crawford vs. John P. Baum.
    
      Partnership.
    
    Where there is a fi. fa. against a firm, and an older fi. fa. against one of the members of the firm, if the sheriff sells the property of the partnership, he must apply the proceeds to Va.^ fi.fa. against the firm.
    Separate creditors of a member of a co-partnership are entitled only to the debtor’s share of the partnership property after all the debts of the firm have been paid.
    BEFORE WARDLAW, J., AT CHARLESTON, JUNE TERM, 1858.
    The report of his Honor, the presiding Judge, is as follows:
    “ At January Term there was a rule against the sheriff to show cause why he did not pay money in his hands to the plaintiff in this case. By his return the sheriff showed that this plaintiff had the oldest judgment and fi.fa. against J. P. Baum; but that J. H. Murrell had a judgment and fi.fa. of later date, which were against J. P. Baum & Son — a partnership composed of this defendant, J. P. Baum, and his sod, J. A. Baum; that having writs of fi.fa. in both of these- cases, the sheriff had sold stock in trade, furniture and negroes, and the plaintiffs in both cases claiming the proceeds, he could not decide which was entitled to receive them.
    u An order was then made for an issue to try whether the negroes and furniture, mentioned in the return, ‘ are the private estate of John P. Baum, or the partnership assets of John P. Baum & Son, the creditor of the partnership to be actor in the issue.’
    
      “ At this term, upon trial of the said issue, Murrell vsOrawford, the verdict was that the furniture was of the part, nership assets, and the negroes of the private estate of John P. Baum.
    
      
      “ Under a rule against tbe sheriff, at the instance of Murrell, I then ordered'that the proceeds of the stock in trade and of the furniture, should be paid to him, the partnership creditor; and under the other rule, I ordered that only the proceeds of the negroes should go to Crawford.”
    The plaintiff, Crawford, appealed, on the ground that his judgment and fi.fa. beiDg older than Murrell’s, he was entitled to so much of the proceeds of the sale of the partnership property as belonged to his debtor, John P. Baum.
    
      Martin, for appellant.
    The burthen of the argument rests on those who insist on junior executions being preferred.
    Claims of partnership creditors give no lien until execution, even in equity; then they are not technically a lien upon the assets in specie, but a right to follow the property as a trust fund. Cross on the Law of Liens, 34 Law Library, for 1841, 136; Campbell vs. Mullett, 2 Swan. 610. The interest of a partner is the surplus after an account is had, and cannot be taken before account. Taylor vs. Fields, 4 Yes. 396; 6 Yes. 127. Separate interest of a partner liable under fi. fa. against him. Moody vs. Payne, 2 Johns. Ch. 648. Such interest subject to attachment. Schatzell vs. Bolton, 2 McC. 478. And ordered to be paid over. Schatzell vs. Bolton, 3 McC. 33. May be assigned. Wilson vs. Bowden, 8 Eich. 9. And such assignment held good against creditors of partnership. Morris & Brother vs. Yernon & Poole, 8 Eich. 13. Same principle recognized in Campbell vs. Mullett, 2 Swan. 610.
    If the separate interest is thus subject to attachment and assignment, the plaintiff, Crawford, was entitled to it under his fi.fa.
    
    If the equity of the partnership creditors gave no lien until judgment, the lien already acquired could not in this Court be divested by the subsequent judgment.
    
      The decision proceeded upon the rule of the Court of Equity, but has not adhered to it, by ordering payment before account. Waters vs. Taylor, 2 Ves. & B. 300.
    The court of law is incompetent to adjust the relative rights of the execution creditors in the case as made. Waters vs. Taylor, 2 Ves. & B. 300.
    
      Phillips, contra,
    cited 1 Ves. 239 ; 2 Oowp. 449; 2 Johns. Ch. 280 ; 28 Wend. 606; 22 Pick. 450; Story on Part. § 376; 9 Rich. Eq. 256; 8 Rich. 15.
   The opinion of the Court was delivered by

Glover, J.

Partnership property having been sold under executions in favor of a separate and a joint creditor, the former claims the proceeds of the sale by virtue of his older execution. His prior lien gives him a preference in any disposition made of the debtor’s interest in the surplus remaining after payment of the joint debts; but it is subordinate to the lien of the other partners and joint creditors on the partnership property. The appellant is subrogated to all the rights of John P. Baum, and his quantum of interest is a distributive share in the surplus remainiug after the partnership debts are paid. In the case of White vs. Union Ins. Co., 1 N. & McC. 556, it was decided, that the effects of a copartnership ought to go in the first place to the payment of the copartnership debts, and if there be a surplus, then to the payment of the private debts of each partner, in proportion to his share in the joint funds. Until Murrell’s execution was satisfied, there could be no surplus in the proceeds of the sale applicable to the payment of J. P. Baum’s private debts.

The order made by the Circuit Judge disposes of the fund in the hands of the Sheriff, according to the legal rights of the parties, and the motion is dismissed.

O’Neall, Wardlaw, Withers and Whitner, JJ., concurred.

Motion dismissed.