Singizer's Appeal

28 Pa. 524

• Court: Supreme Court of Pennsylvania
• Decided: July 1, 1857
• Status: Published

Opinion

The opinion of the court was delivered by

Armstrong, J.

George Singizer and George Keeseman were partners in the mercantile business. Singizer died in 1853, at which time there was a considerable amount of debts due by the firm, and some claims to be collected. John Brandt became the administrator of Singizer, and in that capacity collected debts of the firm to the amount of $295.96; and paid debts due by them amounting to $995.81.

After the death of Singizer, Keeseman continued to collect assets, but applied all he received to the payment of the partnership debts; and on the 8th of April, 1854, made an assignment of his individual property to Richard Anderson for the benefit of his creditors. On the settlement of Anderson’s account, a balance of $1341.68 was found to be in his hands for distribution among creditors. Before the auditor, Brandt claimed a pro rata allowance on $354.92, being half the amount of the firm debts which he had paid out of the assets of the estate Of Singizer. This claim was not allowed; and for this reason the question is raised here.

It is usual for creditors of a firm to proceed against the survivor; and it is his duty to collect the assets and pay the firm debts. But no adverse proceeding appears to have been instituted against either of the partners or their representatives. Keeseman, until he made his assignment, received and paid money to the debts of the firm. How much is not stated. Singizer’s administrator had also received and paid debts out of the joint funds. But no settlement had ever been made between them. How much capital was originally put into the' concern, by one or the other, does not appear. The books were not produced. John Murphy, a witness, it is true, speaks of them; but he refers to them only to show • how the note of Keeseman to Brandt was reduced to $4.88, which appeared to have originated out of the individual accounts distinct from the partnership, and was allowed. The duty of the auditor was to distribute the separate assets of Keeseman among his individual creditors, and not to go behind the assignment in disregard of their rights, to adjust the equities between the partners. These could only be settled by amicable arrangement, or by account render before another tribunal. The administrator stands in the place of his intestate, and on no higher ground; yet he claims that this position entitles him to receive out of the individual assets the amounts paid by him to firm debts, after those assets had been assigned to individual creditors. What was the position of Singizer (had he been living) at the time of the assignment ? Simply that of joint debtor with Keeseman. Upon what principle then could he have laid hands on the funds to be distributed ? Not by subrogation, for that does not apply between joint debtors; and he was not a surety. Brandt asks to stand as a creditor partner of the firm. But this he could not do without showing by clear evidence that on a settlement with the firm, Singizer was in advance of his partner. And to do so, it would be requisite to take and state an account between the partners before the court would interfere in any way to enforce the claim for distribution: 5 Watts 231. A surety who has paid money for his principal on a judgment, may have the judgment assigned to him, to indemnify himself: 2 Pa. Ref. 378. But this was not the condition of Singizer. There was no judgment against either of the partners. In 3 W. & S. 404, Himes v. Keller, it was held, “ that a substitution which will work a prejudice to other creditors, not parties to the arrangement, will be made only in a clear case.” The evidence on the paper-hook, admittedly deficient in bringing the facts before us, failed to convince the court below that Singizer was a creditor partner of the firm, and it is equally unsatisfactory here. To allow him or his administrator to come in, would be prejudicial to the individual creditors of Keeseman. In Walker v. Eyth, 1 Casey 217, Chief Justice Lewis held it as settled that “ where there are separate and partnership creditors, and separate and partnership property, the rule in equity is, that each estate shall be applied exclusively, in the first instance, to the payment of its own creditors,” and that a retiring partner, until deprived of dominion over his individual property, had a right to appropriate it to payment of his individual debts, or to any one of his separate creditors whom he might think proper to prefer.” No objection has been raised to tbe legality of tbe assignment by Keeseman for the benefit of bis individual creditors. At tbe time it was made, not a dollar of tbe sum now claimed by Brandt was paid. Keeseman had then a perfect right to control bis owm property. He appropriated it to bis own creditors, and they had the exclusive right to the fund in court for distribution.

Judgment on tbe report of auditor confirmed.