National Bank of Baltimore v. Sackett , 2 Daly 395 ( 1868 )

By the Court.—Daly, F. J.

The point involved in this ease has been decided by the general term of the Supreme Court of this district in Palmer v. Myers (43 Barb. 509), and was, I think, decided correctly.

The decision of the Court of Appeals in reversing Robinson v. Gregory (29 Barb. 560), is not reported; but from what is said respecting that judgment by Justice Wright in Welles v. March (30 N. Y. 350), it was a very different case from Palmer v. Myers, or the one now before us. The partner who had not joined in the assignment in that case, had not absconded, but was simply absent when the resident partner here executed the assignment, and Justice Wright, in referring to the facts in that case, says that the absent partner had never, in writing or verbally, assented to the assignment, but on the contrary dissented. Justice Roosevelt, who gave the opinion of the Supreme Court, says that he executed a power of attorney to one of his copartners, which, says the justice, “ interpreted by the light of surrounding circumstances, was clearly intended to meet every possible emergency.” The Court of Appeals, as may be inferred from the statement of Justice Wright, evidently thought otherwise, and did not regard it as conferring any authority to make for him a general assignment -of all the funds and effects of the partnership to a trustee for the payment of debts.

In the subsequent case of Welles v. March, supra, the Court of Appeals upheld the validity of an assignment by one partner where the other had absconded, leaving behind him a letter, clearly conferring authority upon the remaining partner to make such an assignment. It may be extracted from this decision, and that of the Supreme Court in Palmer v. Myers, supra, that the authority of each partner is limited to transactions within the scope and object of the partnership ; that a general assignment of all the partnership effects to a trustee for the benefit of creditors, is the exercise of a power, without the scope and object of the partnership enterprise, being a suspension and dissolution of it; that no such power can be implied from the partnership relation, and consequently where it is exercised without the consent or authority of one of the copartners, the assignment is void, and passes no title; but that such a consent and authority is necessarily implied where the partner absconds, under circumstances indicating clearly an intention on his part to abandon the business to the remaining partners, and leave the exclusive control and management of it entirely thereafter to them.

In this present ease, the partner absconded, taking with him a large portion of the assets of the firm, in which, in fact, he had no capital, but to which, he was, at the time, indebted ; and he has never since been heard from. By this wrongful and dishonest act, he himself put an end to the firm, and the act was one clearly implying his consent to the disposition which his partners subsequently made of the remaining effects for the benefit of creditors.

The order dissolving the injunction should be affirmed.

Order affirmed.