Court Opinion

ID: 6244912
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:55:50.381089+00
Date Added: 2024-06-11T08:59:15.857265
License: Public Domain

Opinion by
Mr. Justice McCollum,
The only question presented by this appeal is whether the learned auditor erred in finding that the 950 shares of the Philadelphia Copper Mill Company stock and the fifteen five per cent coupon bonds of the Bloomington City Railroad Company charged in the assignee’s account “ as individual assets of Josiah F. Bailey were his, and not assets of the firm of J. F. Bailey & Sons.”
If the finding was warranted by the testimony relied on to sustain it the distribution based upon it must be affirmed. It is conceded that if Josiah F. Bailey was the sole owner of the stocks and bonds when he and his sons assigned their individual and firm assets, his individual creditors were primarily entitled to the proceeds arising from the sale of them. “ Where there are partnership and separate creditors and partnership and separate assets, and the firm is insolvent, each class has priority upon its respective estate: ” Assigned Estate of Jamison & Co., 163 Pa. 143.
The partnership of Josiah F. Bailey & Sons was formed in January, 1891, and terminated in March, 1893, by an assignment for creditors. The agreement which created it was not in writing and the terms of it were ascertainable only by appeal to the recollection of the parties. The sons contributed nothing to the capital of it aside from their services. It is undisputed that whatever capital the partnership had during its existence was contributed by Josiah F. Bailey or acquired in the conduct of its business. He testifies that his cash contribution to it was $10,000, and that the only assets it had at any time from its organization to its collapse consisted of cash on hand and book accounts. This testimony is certainly and clearly opposed to the contention that the stocks and bonds in question are firm assets. It does not appear that his copartners claimed at any time an interest in the property designated in the as*388signee’s account as his individual assets, or that it was considered by them as firm property. It was certainly never formally transferred to the firm, and there is no evidence before us of a declaration or statement by any member of it, prior to the assignment, from which an inference of joint ownership can be fairly drawn. On the contrary the copartners agree and testify that Josiah F. Bailey was the sole owner of the property designated in the assignee’s account, as above stated, and that the firm never had any interest whatever in it. The stocks were registered in his name and the bonds were pledged as his property. These are circumstances in accord with his claim of individual ownership and with his own testimony and that of his copartners.
The entry of the stocks and bonds on the books of the firm under the head of “ security account ” and the evidence of declarations of Josiah F. Bailey after the assignment, in which it is claimed he recognized them as firm assets, constitute the main reliance of the appellant in its contention that the firm creditors are primarily entitled to the fund created by a sale of them. It was undoubtedly the duty of the auditor to carefully consider these matters in connection with the testimony of Kinsley and of Josiah F. Bailey in explanation of them, and that he did so plainly appears by his report. The declarations referred to, having been made after the assignment, were admissible as evidence only for the purpose of affecting the credibility of Josiah F. Bailey as a witness and the weight to be given to his testimony. While it may be conceded that the matters on which the appellant’s contention is based may admit of a construction which would authorize inferences opposed to the finding complained of, it is by no means clear that such inferences should prevail against the direct and positive testimony that the stocks and bonds were not firm assets. It was the province of the auditor to duly consider and pass upon all the evidence relevant to the questions before him and, having due regard to the credibility of the witnesses and their interests in the issue, to find from such evidence to whom the stocks and bonds belonged at the time of the assignment. That he conscientiously discharged his duty in the premises, and that his finding was fully authorized by the evidence we have no doubt.
Decree affirmed and appeal dismissed at the costs of the appellant.