Jarvis v. Brooks

Gilchrist, C. J. This is a writ of entry to recover possession of the “ blacksmith shop lot,” west of the road, and “ the grist mill lot,” east of the road. The title of the plaintiffs is by a levy on the land, as the property of Leonard and Hiram Gilmore, as tenants in common. The title of the defendants is by a levy on the land, alleging it to be partnership property, the defendants’ intes-‘ tate having been a creditor of the firm of L. & H. Gilmore. The first question is, whether the land was or was not partnership property. There have been four firms of which Leonard and Hiram ■Gilmore were members. I. In the month of December, 1826, the firm of L. & H* Gilmore was .established, composed of Leonard and Hiram Gilmore. II. On the 26th of September, 1827, there was made — 65 — the firm of Gilmore, Hills & Co., consisting of Leonard Gilmore, Ilock Hills and Morris Clark. III. In the month of February, 1828, there was made another firm of Gilmore, Hills & Co., consisting of Leonard Gilmore, Hiram Gilmore and Ilock Hills. IV. On the first of October, 1829, there was made another firm of L. & H. Gilmore, consisting of Leonard Gilmore and Hiram Gilmore. The condition of. the property, so far as it regards partnership interest, is as follows: 1. The “ blacksmith shop lot.” On the 27th of December, 1826, John Tyler and James B. Andrews conveyed to Leonard and Hiram Gilmore five-eighths of this lot, in consideration of the sum of $1,000. Of this sum $600 were paid from the partnership funds, and the remainder .was secured by notes which were after-wards paid by Gilmore, Hills & Co. (No. 2, as above.) On the 26th of September, 1827, Austin Tyler, administrator of Benjamin Tyler, conveyed to Leonard and Hiram Gilmore three-eighths of the “blacksmith shop lot,” in consideration of the sum of $581,25. This sum was paid from the funds of Gilmore, Hills & Co. (No. 2, as above.) 2. The “ grist mill lot.” On the 26th of September, 1827, Austin Tyler, as administrator, conveyed to Leonard Gilmore, Hiram Gilmore, Ilock Hills and Morris Clark one half of the “ grist mill lot,” in consideration of the sum of $1,455; and on the same daya John Tyler conveyed to the same persons the other half of the “ grist mill lot,” in consideration of the sum of $1,500. Of this sum of $1,500, the consideration of John Tyler’s deed, the sum of $925,. was paid from the funds of L. & H. Gilmore, and a part was paid in cash, but how much does not appear. The rest is unpaid. “ The “ clover mill,” spoken of in the case, constitutes a part of “ the grist mill lot.” On the 5th of May, 1829, Gawin Gilmore conveyed it to Leonard Gilmore, Hiram — 66 — Gilmore and Iloek Hills, in consideration of the sum of $350,00. For this sum Gawin Gilmore had given his note, payable to Tyler & Andrews, and indorsed by Gilmore, Hills & Co., and it was paid by this firm. (Np. 3, as above.) The aggregate considerations for these deeds appear from the case to amount to the sum of.............. $4,886,25 Of which there has been paid from the partnership funds the sum of............................2,856,25 Balance,........................2,030,00 The only interest of Gawin Gilmore in the land was by reason of his having become a surety. In consideration of his liability, on the 29th of July, 1829, L. & H. Gilmore and Hills conveyed to him one-fourth of both lots, and he was to reeonvey the lands when the notes on which he was surety should be paid. Whatever title he had then was merely in trust. The substance of what is said in the case about the “ store lot,” seems to be this : On the 29th of July, 1829, the title to this lot was in the Gilmores and Hills, and on that day they conveyed to Gawin Gilmore one-fourth of it. On the 9th of October, Hills conveyed to the three Gilmores all his interest in the demanded premises, they having conveyed to him, on the first of October, the interest in the store. One deed was in consideration of the other. It is not expressly stated in the case, but it is to be inferred from the circumstances that the premises were used for partnership purposes. It is the opinion of Kent, 3 Com. 39, note, that where such facts exist it is unnecessary that there should be an agreement among the partners that the land should be considered as personal property; denying the position in Smith v. Jackson, 2 Edw. 28, which holds an agreement to be necessary. Kent says “ the decisions on this side of the — 67 — question appear to me to be a sacrifice of a principle of policy, and, above all, a principle of justice, to a technical rule of doubtful authority. There is no need of any other agreement than what the law will necessarily imply from the fact of an investment of partnership funds, by the firm, in real estate, for partnership purposes. If the partners mean to deal honestly, they cannot have any other intention than the appropriation of the investment, if wanted, to pay the partnership debts. The circumstance that the payment has been made out of the partnership funds, especially if the property purchased be necessary for the ordinary operations of the partnership business, and be actually so employed, will afford a very cogent presumption that it was intended to be held as partnership property, and, in the absence of all countervailing circumstances, it will be absolutely decisive.” In cases where the real estate is purchased for partnership purposes and on partnership account, it is wholly immaterial, in the view of a court of equity, in whose name or names the purchase is made, whether of one partner or all, whether in the name of a stranger or of one of the firm. In either case, let the legal title be vested in whom it may, it is in equity deemed partnership property, and the partners are the “ cestuis que trust.” Story J., in Hoxie v. Carr, 1 Sum. 173, 182, 183. The same doctrine, going equally far, is contained in Dyer v. Clark, 5 Met. 562, and Howard v. Priest, 5 Met. 582. We have held in the case of Jarvis v. Brooks, 3 Foster’s Rep. 136, and in numerous other cases referred to by the court, that the creditors of a partnership who have attached the property of a firm, take precedence of creditors of the individual members of the firm, who have attached the same property. The land, then, being partnership property, and the partners holding it for the benefit of the partnership creditors, the equitable interest is attachable. The interest of a cestui que trust in land will pass by the extent of an execution — 68 — upon the land as his estate. Pritchard v. Brown, 4 N. H. Rep. 397. And a subsequent attachment of the partnership property, by a creditor of the firm, will take precedence of a prior attachment of the property by a creditor of an individual partner. Tappan v. Blaisdell, 5 N. H. Rep. 190. The declaration by Leonard and Hiram Gilmore, in bankruptcy, that the land was private property, cannot affect the nature of it. As to the levies. It is said that the defendants’ attachment is dissolved, for certain reasons. But it is not seen how any question arises about the dissolution of the attachment. The defendants’ execution being against the partners, takes precedence of the attachment and levy of the plaintiffs. It is, then, immaterial which party had the prior attachment. It would seem that the levy of an execution is good for the amount of the execution and costs. French v. Eaton, 15 N. H. Rep. 337. If the execution takes precedence of the plaintiffs’ attachment, because it is against the partnership property, it disposes of all the questions relating to the dissolution of the attachment. It-appears from the case that Upham’s attachment, on which the plaintiffs rely, was made on the 7th of September, 1841, and his-execution was levied on the 30th of August, 1849. The attachment on the writ, in favor of Grout, the defendant’s intestate, was also made on the 7th of September, but before Upham’s attachment, and the execution was levied on the 15th of March, 1849. Objections are made because the ad damnum, in the defendants’ writ of attachment, was $2,100, and the amount of property directed to be attached was $2,000, and the sum levied was $2156,22, being a greater sum than the officér was directed to attach for, and because judgment was taken for more than the ad damnum in the writ. Whatever validity there might be in these objections, if the original parties, on both sides, had been creditors of the — 69 — firm, no questions concerning them arise at present. The partnership creditors having precedence, nothing more is requisite than that they should have a valid execution, properly levied, in order to avail themselves of their right of priority, and this follows as a necessary result of the principle that their claim is superior to that of the creditors of the individual members of the firm. The opinion of the court is, therefore, that the plaintiffs are not entitled to judgment. Verdict set aside.