Court Opinion

ID: 8297388
Source: CourtListenerOpinion
Date Created: 2022-10-17 11:08:46.571384+00
Date Added: 2024-06-11T16:44:08.378634
License: Public Domain

Cooper, J.,
upon the petition to rehear, delivered ‘the following (dissentingj opinion :
In support of the petition for rehearing in this case, a full and able argument is submitted upon pre*148cisely the same grounds as those assumed in the original argument. The contention is, as before, that the only effect of the renewal of the negotiable securities of the form in their new form was to continue the firm liability. And the argument is thus epitomized at its close: 1. That partnership debts cannot be converted into individual debts, or into partnership and individual debts, without showing both a sufficient consideration, and the mutual and deliberate consent of both parties to the conversion. 2. That the form of the two notes and the draft in the record affords no evidence of any interest to convert the debts evidenced thereby, because their firm, consists equally as well with the theory of non-conversion as it does with that of conversion. The conclusion of the court was that by tlie new securities the old liability of the firm was continued, and the members of the firm became individually liable. The positions of the learned counsel were squarely, although briefly met. The argument now made, and the authorites now cited only bear on those positions. But the first position merely means that a creditor of a partnership cannot be deprived of his rights against the partnership except by his consent deliberately given. It . is not inconsistent with the right of the creditors to add to the liability of the firm the individual liability of the members of the firm. And the second position is, we think, not a logical sequence of the premises, for it requires the court to treat the individual liability as if it had never been .assumed. The very object of the change of form must have been to give the creditors the benefit of *149tbe legal consequences of tbe new form. “And why,” to use tbe language of Judge Story, “should any court deprive the creditor of tbe very benefit which. the debtors had stipulated to give him, or restrain him from using all his rights?” Sto. on Part., sec. 389. The only American authorities adduced in the analogous case of bankruptcy decide that a creditor, who holds a note signed by a firm and an individual member, may prove the claim against the assets of the firm, and also against the estate of the partner: Emery v. Canal Nat. Bank, 7 Bank. Reg., 217; Mead v. National Bank, 7 Am. Law Reg., 818; Farman’s Case, 6 Boston Law Rep., 21; In re Bigelow, 2 Bank. Reg., 371. And -even if the creditors were forced to elect under the English doctrine, they have elected in this case to proceed against tbe estate of the individual member. Rehearing refused.