Lowenstein v. Flauraud

It is well settled, in this state that one copartner cannot, by virtue- of his power as such partner, make an assignment of the copartnership effects to a trustee for the benefit of the creditors of- the firm ( Welles agt. March, 30 N. Y., 344; Robinson agt. Gregory, cited in, opinion of Wright, J., in Welles agt. March); but one copartner can make such an assignment with the authority of the other partner or partners, and such authority may be implied from circumstances, or acts of the partner or partners not joining in the execution of the assignment. In Welles agt. March, one of the partners left the city of New York, leaving a letter to his partner, in which he said, “ I hereby assign you my interest in the business of Nace & Co. and Nace & Beigniers. Take charge of every thing in our business; close it up speedily.” This was held, by the court of appeals, sufficient to confer power upon the remaining partner authority to execute an assignment .on behalf of the firm, and the assignment was upheld. In The National Bank agt. Sackett (2 Daly, 397), one of several partners had absconded, and the court held that his act, in absconding and leaving the business in the possession of his copartners, was one clearly implying his consent to the disposition which his partners subsequently made of ,the remaining effects for the benefit of the creditors. In Power agt. Myers (43 Barb., 509), it was held that the absconding of a partner implied the power to remaining partners to make a general assignment. In Baldwin agt. Tynes (19 Abb. Pr., 32), where one partner had left the city and telegraphed to his copartner to make an assignment, the court held the assignment made by his copartner good. In Dow agt. Bough (36 How. Pr., 479), it was held that an assignment executed by a resident partner, in person, and his attorney in fact, for a non-resident partner, was valid.

It necessarily follows that if the assignment be valid when made by one partner under an implied authority, it must certainly be so when made by express authority.

In this case the partnership was composed of Auguste *465Elauraud and Eugene Elauraud, under the firm name of Elauraud & Son, carrying on business in the city of New York. Eugene Elauraud left New York for Paris before the making of the assignment. The firm was then under some embarrassment, and before his departure Eugene, who was the son of the other partner, in substance, authorized his father to make any disposition of the assets and property of the firm for the benefit of its creditors that he might deem proper; and he also left a power of attorney, bearing date the third of October, and duly executed and acknowledged, by which he constituted and appointed Nathan Metz his attorney in fact, with power to sign and execute all papers and instruments in connection with the business of Elauraud & Son, and especially to sign, seal, execute and acknowledge, and join with his copartner in signing, sealing, executing and acknowledging any transfer, assignment, or general assignment, for the benefit of the creditors, of his interest in the property and assets of the said firm of “ A. Elauraud & Son.” This instrument was very broad in its language and scope,' and gave, so far as it could lawfully be done, every power requisite to the execution of a general assignment. On the eighth of November following the assignment in question was made. It was executed by Auguste Elauraud, and duly acknowledged; it was also executed in the name of Eugene Elauraud by Nathan Metz, his attorney in fact. It appears that Auguste Elauraud immediately telegraphed to his son at Paris that the assignment had been made, and received in reply a letter recognizing the assignment.

We think there can be no doubt that the assignment was, under these circumstances, a valid one, both upon the ground that it was made by one partner with the consent of the other, and also that it was duly executed by the absent partner through and by his attorney in fact. The question is made that the acknowledgment of the assignment-was not in conformity to the requirements of the act of 1860 (Laws of 1860, chap. 388). That act requires that such an assignment shall *466be in writing, and shall be duly acknowledged by an officer entitled to take acknowledgments of deeds, and that the certificate of the acknowledgment shall he duly indorsed upon the instrument before the delivery thereof to the assignee or assignees therein named. It was- held in Hardman agt. Bowen (39 N. Y., 196), that the acknowledgment required by the statute must be made before the title to the assigned property will become vested in the assignees, and it is therefore claimed that the acknowledgment in this case, so far as it relates to Eugene Flauraud, was invalid, because made by his attorney in fact, who exe'cuted the assignment in his name. We think there are two answers to this objection. First, that the instrument having been executed and acknowledged in due form by Auguste Flauraud, with the assent and authority of his copartner, was a valid assignment of the partnership’s effects for the benefit of the creditors independently of the execution thereof by the other partner; and second, we are of opinion that, the assignment having been executed by Eugene Flauraud by his attorney in fact acting under the power of attorney which had been duly executed and acknowledged by him, the acknowledgment made by the attorney in fact was sufficient under the requirements of the statute.

The statute does not say, in express terms, that the assignment shall in all cases be acknowledged by the assignor himself, but simply that, it shall be duly acknowledged before an officer authorized to take acknowledgments of deeds; and it is an established principle of law that where power to execute a deed or other instrument is conferred upon an attorney in fact by an instrument duly acknowledged, such an attorney may perform every act requisite to make the instrument a valid and effective one for the purpose for which it is made. We fail to see any good reason for saying that the instrument in this case was not duly acknowledged within the meaning of the act of 1860. But it is insisted that the assignment is invalid because, by reason of the general bankruptcy laws of the United States, all state insolvent laws are suspended, and *467any assignment under such laws is absolutely void. This position is answered by Thrasher agt. Bently (59 N. Y., 649), where it was held directly to the contrary.

In this case it does not appear that any proceedings in bankruptcy have been taken for the purpose of avoiding the assignment, and therefore we regard the ease as one entirely unaffected by the general bankruptcy law of the United States.

The order appealed from should be affirmed, with ten dollars costs and disbursements.

I concur: Chas. Daniels.

I dissent: John R. Beady.