Norris v. Rumsey

Ellison, J. — The partnership of O. E. Rumsey & Co., composed of O. E. Rumsey and one G-oodsill, was indebted to plaintiff, the indebtedness being evidenced by a promissory note signed by the firm. Upon this note plaintiff brought suit by attachment against O. E. • Rumsey individually and attached (principally) the partnership property. Before the attachment, however, G-oodsill sbld his interest in the .partnership to O. E. Rumsey. O. E. Rumsey thereafter, and also before the attachment, conveyed the property by chattel mortgage to this interpleader to secure an individual debt which he owed him. After the levy of the .attachment this interpleader filed his interplea and lost his case in the trial court. He comes here for relief. The question for decision is, which debt has the preference. Or, in other words, which takes prefer [146] ence, the partnership creditors’ right claimed by plaintiff, or the mortgage securing the individual debt to interpleader? That a partnership creditor has a right (sometimes called a quasi lien), which he derives through the partner’s lien, to have his partnership claim paid out'of the partnership .funds or property, is well settled. This right of the creditor, arising from or being derived through the partner, ceases with the lien of the partner. The creditor’s right is derivative and has no independent or separate existence. If, therefore, one of two partners in good faith sells his interest to his remaining partner, no equity can attach to the partnership effects in favor of the partnership creditor, for the plain reason that the lien is the partner’s lien which .he may destroy or waive by a bona fide sale, and having done so there is nothing left to work the right of the creditor through. These principles are well established by the recent cases in this state. Reyburn v. Mitchell, 106 Mo. 365; Sexton v. Anderson, 95 Mo. 373; Tennant, Walker & Co. v. McKean, 46 Mo. App. 486. There was no fraud found in this case and we must hold, under the foregoing principles of law, that the mortgage securing interpleader’s individual debt has the preference over plaintiff’s partnership debt. But itis asserted,and is true, that O. E. Rumsey and Groodsill, the retiring partner, had an agreement between themselves whereby Rumsey was to pay all the partnership debts. But it is not shown or at least was not found that interpleader knew of this, or'that if he did know it, that, there was not abundant partnership property with which to pay them. But if he had known it, such knowledge, standing alone, would not have affected the matter. Howe v. Lawrence, 9 Cush. 553; Story on Partnership, see. 359. In the case of Reyburn v. Mitchell, supra, Robertson and Mitchell were partners. [147] Robertson sold out to Mitchell with the agreement that he, Mitchell, was to assume partnership debts. Mitchell then conveyed by quitclaim deed to Kilgour his individual creditor; the court held, at page 676, that, if this sale was bona ficle, Kilgour could not be affected by the claims of partnership creditors, and proceeded to hold under the facts of that case that the transaction between Mitchell and Robertson was not in good faith. We examined the principle which governs this case in the case of Tennant, Walker & Co. v. McKean, supra; and a reconsideration of all the cases cited therein as well as the opinion of McEarlane, J. in Reyburn v. Mitchell, satisfies us that the court below has not determined the cause from the standpoint which should govern it, and we will therefore reverse the judgment and remand the cause. All concur.