Shaw v. McDonald

By the Court. McDonald, J. delivering the opinion. [1.] Terrell & Goddard were partners. W. A. B. Goddard mortgaged all his interest, being one half, in and to the stock of liquors and two billiard tables and one pool table and the implements of furniture thereunto attached &c., to Griffin McDonald, to secure certain individual debts.due by Goddard to said McDonald, and also to save him harmless from an individual endorsement. The mortgage bears date the third day of January, 1855. McDonald foreclosed his mortgage, had a writ of fieri facias issued, and levied on the billiard tables which were claimed by the plaintiff in error. On the trial of the claim, the plaintiff proved the possession of the property by the firm of Terrell & Goddard at the date of the mortgage, and that Terrell, in the absence of Goddard, sold the billiard tables to Henry N. Ells, who sold to the claimant. Claimant proposed to prove by the witness, that at the date of the mortgage the firm of Terrell & Goddard [398] was insolvent, and that the money paid by Ells for them was applied to the payment of partnership debts. The Court refused to admit the evidence, and this refusal is made the ground of the first exception. [2.] The mortgagee was aware that Goddard was mortgaging partnership property. That he did, is deducible from the mortgage itself. If the firm was insolvent, the partnership property ought not to have been applied to the payment of an individual debt; and notwithstanding the mortgage, the sale, if bona fide made, in payment of a partnership debt, or for money which was applied to the payment of a partnership debt, was good against the mortgage. Young vs. Keighly, 15 Vesey, Jr., 557. [3.] There is no principle on which the admission or declarations of Goddard, the debtor, could have been received to prove the payment of the debts, to secure which the mortgage was given. It was an extraordinary proposition. [4.] The bill filed by one of the partners against the other, and that other’s answer were inadmissible to prove any fact tending to sustain a title to property they had sold. [5.] The grounds taken in the motion to dismiss the levy, assume principles that we do not recognize as law. The Sheriff may levy on and sell the interest of a partner in the partnership property, but the purchaser will occupy the same relation to the partnership creditors and the other member of the firm, that the debtor did. If the interest is worthless, the sheriff may not find a purchaser, but if he should, the purchaser must be his own judge of the value of the interest he buys. The judgment of the Court below is reversed on the ground that the Court erred in rejecting evidence to prove the insolvency of the firm of Terrell & Goddard at the date of the mortgage. Judgment reversed.