Simpson v. Schulte

Lewis, P. J., delivered the opinion of the court. Schulte, Hill & Nall were a banking firm, and issued to the plaintiff the certificate of deposit for $1,000, which is the foundation of this suit. Schulte 'died, and the defendant Ellen Schulte became Ms administratrix. The suit was instituted against her jointly with the surviving members of the late firm. Judgment for a balance found due was rendered against all the defendants, and the administratrix alone appealed. The appellant undertook to show, by way of separate defence, that, in the lifetime of Schulte, the firm made a general assignment for the benefit of its creditors which assignment was still pending and in process of settlement. That the firm also executed a deed of trust conveying a large amount of real estate to secure certain creditors, of which real estate Schulte owned one-half and the other partners one-fourth each. That claims to a large amount against Schulte's individual estate had been allowed in the probate court, and notices had been served for a still larger amount, which would thereafter be allowed. That the total individual estate of the deceased would not be sufficient to pay the claims allowed against it. That the assets of the firm would, when fully realized and settled, be sufficient to pay off all the debts of the firm, including that held by the plaintiff. That the plaintiff had presented to the assignee of the late firm the claim here sued on, and procured its allowance for the full amount due thereon. The plaintiff objected to all the evidence of these facts as offered, and the court, sitting without a jury5 heard it only for the purpose of passing on its admissi [642] bility. It was then all excluded, and the defendant excepted. In the defendant’s motion for a new trial, no objection was mentioned against the exclusion of testimony. This fact alone is sufficient to require an affirmance of the judgment. There was no testimony whatever before the court, constituting any defence to the action. Whether this resulted from error in the exclusion of testimony offered, can not here be inquired into, since the •error, if any, was not brought to the attention of the •court in a motion for a new trial. Such has been • the uniform ruling of our supreme court in a number of ■cases. Railroad v. Clark, 68 Mo. 374; Brady v. Connelly, 52 Mo. 19; Vineyard v. Matney, 68 Mo. 105; Carver v. Thornhill, 53 Mo. 283. But if the proposed facts had all been admitted, they would have constituted no legal or equitable defence whatever. No one of them, nor all together, presented a single reason why the plaintiff’s demand was not .a just one, and should not • be so adjudged. What the ■appellant insists upon as the “ equities” (whether tenable or not) which should be observed in the ultimate settlement of the various claims against the several funds, have nothing to do with the question whether the intestate was a debtor of the plaintiff at the time of his death, and whether such indebtedness should be fairly ascertained and determined by judicial proceeding. The argument for the appellant ignores all distinction between the right to obtain a judgment in the first place, and the methods proper to enforce it when obtained. To the latter, only, belong those carefully elaborated dissertations of learned counsel, on equitable preferences, distribution of assets, etc. It may be true that, if the appellant should pay off the whole of the judgment in this case she would be paying more than her intestate’s share of the partnership indebtedness. But what have the plaintiff and his rights to do with that % If he held a legal and enforceable claim against the intestate when [643] in life, this was not extinguished by the debtor’s death, but remained in the same relation to his legal repr esentatives. A court of competent jurisdiction, in a suitable proceeding, could not refuse to declare that relation in a final judgment. If inequalities result, with reference to joint obligors, as surviving partners, these must be adjusted between the estate and them. Formerly, when a partner died, all existing claims against the firm were, at common law, enforceable only against the surviving partners. There was no way of obtaining contribution from the estate of the deceased partner, except by a proceeding in equity. In process of time, it became the settled doctrine of courts of equity that all partnership obligations were to be treated as joint and several. They were, therefore, enforceable in those tribunals against the estates of deceased partners, but .this did not prevent an adherence to certain equitable rules in the distribution of assets, designed to protect the rights of surviving partners and partnership creditors. A preference has generally been given to the firm’s creditors in obtaining satisfaction out of the partnership assets. But it by no means follows, as the appellant seems to suppose, that the partnership assets must be exhausted for satisfaction of a partnership debt, before the individual estate of a partner can be proceeded against for the same purpose. No analogy gives countenance to such a conclusion. Each partner is interested in having the firm debts paid, because his own liability becomes thus extinguished, and he may justly demand that the firm’s assets shall be devoted to that end, rather than to liquidating the separate indebtedness of •other partners. The firm creditor, also, may claim that his credit was given in reliance on the assets of the firm. But when a firm debt is paid out of the sepa, rate estate of a partner, no one’s rights or equities are interfered with. Not those of the creditor, or of the other partners, of course. And as to the paying partner, he. only pays what he has bound himself to pay, [644] and if it be more than his proper share, he will be entitled to reimbursement from his co-obligors, to the extent of .the excess. As a corollary of the proposition that partnership indebtedness is joint and several, it has universally been considered that a joint creditor might, at his pleasure, proceed to judgment against a single partner in like manner as he might if there were no co-obligor in existence. A striking illustration of this effect appears in Allen v. Wells (22 Pick. 450). It is, therefore, held that where a partnership creditor attaches private property, and a private creditor afterward attaches the same properly, the partnership creditor retains his lien, although his claims may exhaust the property. See, also, Boatmen's Sav. Bank v. Mead, 52 Mo. 543; Cox v. Miller, 64 Tex. 27; Dahlgreen v. Duncan, 7 Sm. & Mar. 280; Tucker v. Oxley, 5 Cran. 40; Hassell v. Griffin, 2 Jones’ Eq. 119. Precedent' and principle are so thoroughly harmonious on the conclusions due to a controversy like the present, that we might, without detriment to our position, even pass by our Missouri statute (Rev. Stat., sect. 3467), which settles every doubt in the following words: “ Every person who shall have a cause of action against several persons, including parties to bills of exchange and promissory notes, and who shall be entitled by law to one satisfaction therefor, may bring suit thereon, jointly against all, or as many of the persons liable as he may think proper ; and he may, at his option, join any executor or administrator,. or other person liable in a representative character with others, originally liable.” The defendant asked for some instructions adapted to her views of the evidence offered by her. But, as the evidence was not before the court, there could, of course, be no error in refusing the instructions. The judgment is affirmed. The other judges concur.