Court Opinion

ID: 7059958
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:19:40.689495+00
Date Added: 2024-06-11T16:12:07.763053
License: Public Domain

Dissenting Opinion.
Crumpacker, J. —
I can not concur in the conclusion of the court, that the general lien of an execution upon partnership property is paramount to the constitutional right to exemption after the firm has been dissolved, and the property divided between the partners. No one will deny the right of the owners of an estate in common to claim their respective shares of such estate, under the exemption laws, *162from the lien of an execution upon a judgment against all of the owners jointly.
The only reason why this doctrine does not apply to existing partnerships is that each partner has the right to insist that the joint property shall be used for the payment of firm debts before a member of the firm may appropriate any part of it to his individual use.
This right is essentially personal to the members of the firm, and is paramount to the right of exemption in the individual members, and it furnishes the only basis for the superior rights of firm creditors. Such creditors are permitted to avail themselves of it upon the theory that its exercise is beneficial to the several members of the partnership, and for this reason they are presumed to assent thereto. But the partners may surrender such right, and when this is done the firm creditors are reduced to the same footing as individual creditors. In my opinion there is no adequate reason why this may not be done after an execution lien has attached.
A partnership is not such,a distinct legal entity that upon its dissolution, and the division of its property, the respective members are presumed to hold their shares in the right of the firm. There is no change of title upon such division, but each member thereafter holds his share in severalty by the same title by which he held his undivided interest in the joint property. Execution liens do not confer vested rights upon the creditor, and when a debtor presents his schedule and demands property exempt from sale, the inquiry is directed to the conditions at that time, and if they then concur in his favor the right can not be denied. State, ex rel., v. Read, 94 Ind. 103 ; Eltzroth v. Webster, 15 Ind. 21.
Many courts, outside of this State, recognize the right of partners to claim property under the exemption laws which came to them upon a dissolution of the firm after an execution lien has attached. Russell v. Lennon, 39 Wis. 570 ; *163Blanchard v. Paschal, 68 Ga. 32 ; Skinner v. Shannon, 44 Mich. 86 ; Stewart v. Brown, 37 N, Y. 350.
It is well settled that a debtor may, by his own voluntary act, divest an execution lien, and hold property from sale upon execution, by putting himself in a position to claim such property when he had no right to it when the lien attached. Robinson v. Hughes, 117 Ind. 293 ; Watson v. Simpson, 5 Ala. 233 ; Letchford v. Cary, 52 Miss. 791; McManus v. Campbell, 37 Texas, 267.
The case of Smith v. Harris, 76 Ind. 104, upon which the principal opinion seems to be founded, was expressly decided upon the authority of Love v. Blair, 72 Ind. 281, and an examination of the latter ease will disclose that it contained no such question. So Smith v. Harris, supra, can not be regarded as the deliberate declaration of the Supreme Court upon the question, and it is so at variance with the principles declared in Robinson v. Hughes, supra, and Goudy v. Werbe, 117 Ind. 154, that it ought not to be accorded a controlling influence in the decision of this case. Besides, it entirely disregards that familiar rule which requires the exemption laws to be most liberally construed in favor of the debtor. Kestler v. Kern, 2 Ind. App. 488 ; Wilson v. Joseph, 107 Ind. 490 ; Butner v. Bowser, 104 Ind. 255 ; Astley v. Capron, 89 Ind. 167.
For these reasons I respectfully dissent from the decision of the court.
Filed Dec. 9, 1891.