Court Opinion

ID: 5207259
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:05:00.648413+00
Date Added: 2024-06-11T08:27:13.472583
License: Public Domain

McLaughlin, J. (dissenting):
The firm of Carl von Pustau & Co. was a limited partnership, of which von Pustau was the general and Heekscher the special partner, he having contributed the sum of $50,000.
The action is in equity for an accounting concerning certain transactions which took place between plaintiffs and it prior to the withdrawal of the amount contributed by the special partner, and for judgment for such amount as may be found due against the general partner and against the special partner to the extent of the amount withdrawn.
The statute limits the liability of a special partner to the sum contributed by him. This amount, however, he cannot withdraw while the partnership exists. It exists so far as past transactions are concerned until its contracts have been satisfied and all its debts paid. A special partner has no legal right, the moment the limita^ tion of the partnership has arrived, to withdraw his capital unless all the obligations of the firm have then been discharged. A withdrawal then works a dissolution only so far as future transactions are concerned; as to the past, the firm continues to exist for the purpose of collecting, settling up and distributing its assets and per*636forming its antecedent engagements. (Bliss v. Hornthal, 33 App. Div. 225.)
It may be that plaintiffs could, in the first instance, have proceeded against the general partner, and on the recovery of a judgment, the issuing of an execution thereon and the return of the same unsatisfied, could then have proceeded against the special partner, but this was not their only remedy. The partnership having expired by limitation, and nothing remaining to be done but discharge the liabilities of the firm and divide its assets among its members, plaintiff may maintain an action in equity for an accounting, enter judgment against the firm for the amount found due, and against the special partner to compel him to return to the firm the amount which he withdrew, to the end that the judgment recovered, if any, may be satisfied to that extent.
All of the parties interested in the subject-matter of the litigation are before the court, and it is a general principle of equity jurisprudence that where the whole subject-matter involved can be settled in a single action a court of equity will take jurisdiction. (Whiting v. Elmira Industrial Assn., 45 App. Div. 349; Baily v. Hornthal, 154 N. Y. 648; Murtha v. Curley, 90 id. 372.) The whole subject-matter of the litigation can be settled in this action. Under .such circumstances I can see no necessity of compelling the plaintiffs, before asking the special partner to return the fund which he wrongfully withdrew, to proceed against the general partner — thus possibly subjecting them not only to delay, but to the trouble, annoyance and expense of maintaining two actions when it could just as well be done in one.
For these reasons I am unable to vote for an affirmance of the judgment appealed from. In my opinion the complaint states a good cause of action, and the judgment should be reversed, with leave to the defendant Heclcseher to withdraw his demurrer and interpose an answer on payment of the costs in this court and in the court below.
Judgment affirmed, with costs, with leave to plaintiffs to amend on payment of costs.