Morrow v. Fossick
Morrow v. Fossick
Dissenting Opinion
delivered a dissenting opinion.
In 1876 complainant filed an attachment bill in the-Chancery Court at Knoxville claiming a debt due individually from F. L. Fossick, a resident of the State-of Alabama. It was charged that the debtor had no-property in the State known to complainant except a debt due from W. W. Woodruff, and this debt was attached. Woodruff answered, but it turned out the-debt was shown by him to be due not to F. L. Fos-sick individually, but to a firm in the State of Ala
Complainant, however, asked and obtained leave of the court, and did file wliat is called an amended and: supplemental bill, but which is in fact, as I think, only an original bill against the firm of F. L. Fos-sick & Co., seeking to wind up and settle said firm in our State, based on the fact alone that one of the members of the firm owed complainant an individual debt, and that on information and belief there would-be found a balance in his favor on taking the partnership account which complainant insisted to have applied to his debt.
A motion was made by attorneys of defendant to this bill to dismiss for want of jurisdiction of the persons of the defendants, which was sustained. From this decree alone an appeal in error is prosecuted to
The supplemental matter in this case is nothing more than the fact of a partnership charged, the names of' the partners, where the firm is, to-wit, in Alabama, with an averment of belief that on settlement of the firm a balance will be found in favor of the individual debtor, and a prayer for discovery of the terms of the partnership, the amount of the capital put in by each, and then a prayer that the firm be settled up, account had of its condition, and ascertainment of the interest of the debtor, and then an appropriation of that interest to complainant’s debt.
This court has held that the interest of a partner in a firm may be sold for his individual debt. Haskins & Reynolds v. Everett, 4 Sneed, 532. The court says, in giving that opinion, “The purchaser, however, ■only takes the interest of such judgment debtor after the settlement and adjustment of the partnership accounts, and not in proportion of the property sold. What that interest is cannot genally be ascertained until a final settlement and adjustment of the partnership concerns. The effect of the sale and purchase is only to place the purchaser in the shoes of the partner whose interest he buys, and make him a tenant in common with the other partners. This is a necessary consequence of the rule that each partner has a lien on the partnership property as well for the debts due by the firm as his own share and proportion thereof. The judgment creditor or. purchaser must take the interest sold subject to all such liens and
If the creditor chooses to avoid this he may, or the sheriffj Avith his consent, may file a bill in advance of the sale and ascertain with exactness the interest of the partner before the sale. The court, however, is here treating the case of levy of an execution Avhich is necessarily based on a judgment, and involves the necessity of jurisdiction of the parties.
Judge Story lays doAvn the same doctrine with more distinctness in vol. 1, Eq. Jur., sec. 677. In such case, he says, “the judgment creditor can levy not on the moiety or individual share of the judgment debtor in the property as if there Avere no debts of the partnership or lien on the same for the balance due to the other partner, but he can only levy on the interest of the judgment debtor, if any, in the property after payment -of all debts and other charges therein.” He then goes on to say that the sale does not transfer any part of the joint property to the vendee so as to entitle him to take it from the other partners, for that Avould be to place him in a better situation than the partner himself. But it gives him, properly speaking, a right in equity to call for an account, and thus entitle himself to the interest of the partner Avhich shall, upon such settlement, be ascertained to exist.
Mr. Parsons, in his Avork on partnership, in the
If these principles be correct, and there can be no question, both on general authority and our own decisions, of this, then it seems clear to me this supplemental bill cannot be sustained. It is but an attempt by way of supplemental matter to have the account taken and firm settled up before or in order to an appropriation of the interest of the debtor when it can be ascertained. If the purchaser who buys what is levied on but stands in the shoes of the partner, it is because the levy but fixes on that interest and no more, for he gets all the officer takes, -and the officer only gets, by the levy of execution, the interest of the partner — an attachment only fixes a lien on it. If the levy only puts the officer or the purchaser in the shoes of the debtor partner, the question is, could the partner, being a non-resident, come here and file a bill to wind up this partnership on
If this be correct, then under the original bill you-have all the parties before the court who has any interest in that litigation, that is the debtor. You seek to sell his interest, he is before the court when you levy on that interest, or it may be so assumed for this case. No decree can be made in that case against the other partners, nor is their title sought to be in any way effected; no claim of right is sought, or could be made against them. Why, then, should they be made parties? It can only be for a purpose not involved in the original suit, and that purpose is one to which they have the right to object, as they have done in this case, and 'resist the jurisdiction. The fact that what is sought is presented in the form of a supplemental bill to the original, and as part of that proceeding can make no difference. The essential fact remains that this is a bill by a party in this State to wind up a partnership in another State, filed against parties not within the juris
The only party concerned in that question is the debtor who alone represents that interest, the creditor •only taking or seeking to have a decree against his individual interest after the partner’s interest has been separated from it, and a right on the part of the purchaser of such interest by being placed in the shoes ■of the debtor to have an account to ascertain what that interest is. The other partners are not necessary parties for the objects of the original bill; the purposes of the supplemental bill are such as the court has no power to effectuate or adjudicate against the ■claim of the parties.
I think the radical error of the majority opinion is in assuming that this court has jurisdiction of the •subject matter of the litigation presented in the amended bill. The subject matter of the original bill is the •debt due from F. L. Fossick to Morrow, with an attachment alleged to have been levied on his property. The subject matter of the amended bill is to wind up and settle the partnership between F. L. Fossick and his two sons in the State of Alabama. This firm has no local existence in this State, nor can the court get jurisdiction of its subject matter by levying an attachment on the property of F. L. Fossick, or claimed to be his. What right can a debtor of F. L. Fossick have to litigate with other parties in
The principle is conceded as a matter of course that if a bill does not contain material facts, or make such persons parties as are necessary in order to enable the court to do complete justice, complainant may supply these defects by amendment. But to do complete justice can only mean to settle the rights of ‘complainant and defendant, not the rights of complainant against other parties who are in this case not claimed to be debtors of complainant, and against whom no relief can be sought on the footing of having a debt against F. L. Fossick: He is the sole debtor, and his individual interest is alone to be affected by the decree. You can sell, but in doing so you can and do decree nothing against the other defendants. The effort, however, is, in this case, by selling the individual interest of F. L. Fossick, to give the court jurisdiction of the firm of F. L. Fos-sick & Co., and wind up a partnership existing in the State of Alabama. It seems to me the decree would be void when made under the .late decision of the Supreme Court of the United States in the Ore-gan case, Pennoyer v. Neff, Rep. vol. 5, 358, which
I conclude, for these reasons, the decree of the Chancellor should be affirmed.
Opinion of the Court
delivered the opinion of the court.
On the 11th of September, 1876, the complainant, as a creditor of F. L. Fossick, filed this bill against his debtor as a non-resident of the State, and one Woodruff, to attach the indebtedness of Woodruff to Fossick, and subject it to the satisfaction of his debt. The debt was attached, the amount admitted by Wood-ruff and paid into court. On the 26th of September the defendant Fossick entered his appearance and was
When a complainant has preferred his bill and is advised that the same does not contain such material facts, or make all such persons parties as are necessary to enable the court to do complete justice, he
But the motion to dismiss is not rested on the want of jurisdiction over the subject matter of the liti— gation, but because the court had no jurisdiction of the person. So far as the original debtor.- is .con
The decree of the Chancellor will be reversed, and' the cause remanded for further proceedings.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.