Swan v. Gilbert

Mr. Justice Waterman delivebed the opinion of the Coubt. Upon the trial of this cause, it appeared, xvithout dispute, that the firm of W. A. Cave & Co. and F. Gf. Mathison & Co. xvas insolvent at the time the sheriff received the plaintiffs’ respective executions. It is objected that a member of the firm was permitted to testify that at such time the firm was insolvent, it being insisted that he should have been asked as to the assets and liabilities of the firm, that therefrom a conclusion as to its insolvency might be deduced. We think that an active, managing partner of a mercantile business, familiar with its affairs, is to be considered a competent witness to testify regarding its insolvency, and that he may, upon direct examination, testify that the firm is either solvent or insolvent, leaving to the other side, if dissatisfied with such evidence, an opportunity to examine him as to the assets and liabilities of such firm, and the knowledge he has from which he makes his statement. Moreover, the undisputed facts brought out upon the trial, show beyond question that the firm was insolvent, as the witness testified. Appellants claim that the sheriff, in refusing to consider their executions as being liens having precedence over the Farwell mortgages, assumed to act judicially; that he should, as requested by appellants, have examined the files of the causes in which appellants’ respective judgments were entered, and that therefrom he would have seen that while each judgment was against but one of the partners, it was obtained for a firm indebtedness. It appears to us that it was the appellants who asked the sheriff to act judicially. The sheriff had in his hands two writs, each of which ran only against one partner. Under such writ he had authority to sell only the right, title and interest of the person against whom the respective executions ran, and had no right to take or sell the property or interest of any other person. It was not for the sheriff to examine the files of the respective causes in which such executions were issued. His duty and his right was merely to obey the command of the processes given to him. Upon the judgment and execution against W. A. Cave, the sheriff could levy upon and sell only the right, title and interest of W. A. Cave; and upon the other judgment and execution against F. G. Mathison, the sheriff could levy upon and sell only the right, title and interest of F. G. Mathison. The several judgments were in favor of different plaintiffs. The law is well settled, that a partner’s interest in firm property may be sold under an execution against him only, and that interest, whatever it is, will pass by such sale to the purchaser, but the purchaser takes the interest precisely as it was held by the defendant in the execution, subject to the rights of partnership creditors in and to the property so sold, and also to the rights pf the other partners. If, on a settlement of the partnership affairs, the defendant in the execution is entitled to nothing, the purchaser at sflch execution sale will not obtain anything by his purchase. Such purchaser is compelled to settle with the other partners precisely as would the defendant in the execution, had his interest not been sold. A judgment creditor of one partner can not, by a levy upon the debtor’s interest in the firm property, or a sale thereof under execution, acquire a lien superior to the rights of the other partners, or of partnership creditors; nor can the sheriff levy upon any specific article of partnership property and segregate .that as the property of the defendant partner; but he must levy, if at all, upon the partner’s interest in the whole stock; for the only interest the partner has in the firm property is the surplus after the partnership debts are paid, and the accounts between the partners have been adjusted. Murfree on Sheriffs, Sec. 545; 2 Bates on Partnership, Secs. 1111,1112; Chandler v. Lincoln, 52 Ill. 74; Rainey v. Nance, 54 Ill. 29 ; Richards v. Allen, 117 Pa. St. 199; Clements v. Jessup, 36 N. J. Eq. 569; Commercial Bank v. Wilkins, 9 Me. 28; Rice v. Austin, 17 Mass. 197; Wilson v. Strobach, 59 Ala. 488. Upon the hearing of this cause it appeared that the entire firm property was not equal in value to the mortgages placed thereon by the firm to secure partnership debts, and that all of the mortgaged property had been sold for partnership debts, leaving a portion of the same unpaid. As to the $72 in money, firm property, which the sheriff seized, while it was not covered by any of the chattel mortgages, and consequently could not be held thereunder, it was firm, property. The sheriff could not, therefore, apply the same to the satisfaction of either of the executions which he held, neither of the same being against the partners, but only against a partner. It is true that it is the duty of the sheriff to obey all proper instructions given him by the plaintiff in an execution; the writ is the plaintiff’s; but it is not the duty of the sheriff upon an execution against A, to levy upon the property of B, although the plaintiff may command him to do so. Hor is it the duty of the sheriff to apply firm property to the satisfaction of an execution against one of the partners, although the plaintiff may direct him so to do. The only interest in the firm property which either of the plaintiffs, by the respective executions placed in the sheriff’s hands, could reach and sell, was the interest in the firm property of the respective partners against whom such executions respectively ran, and only the interest of such partner in said $72 could be applied to the satisfaction of such executions, or either of them. It appeared upon the trial of this case, that neither of the persons against whom such executions severally ran, had, as against the creditors of the firm, any interest whatever in such $72. We are not called upon to say what the rights of the respective plaintiffs would have been had they, or either of them, filed a bill setting up thg,t the judgments were given for firm indebtedness, and asked that as firm creditors they be allowed to prorate with, or have precedence over the Farwell chattel mortgages made subsequent to the reception by the sheriff of plaintiffs’' respective executions. The judgment of the Circuit Court is affirmed.