Adams v. Sturges

Citations

• 55 Ill. 468

Syllabus

<p>1. Partnership—application of funds of a firm, and those of individual members of a firm. It is a uniform rule that partnership property shall be applied to the partnership debts, to the exclusion of the creditors of the individual members of the firm, and that the creditors of the latter should be first paid from the separate effects of the debtor before the partnership creditors can claim anything.</p> <p>2. So where an individual member of a firm deposited with a creditor of the firm a promissory note belonging to the former, as collateral security for a particular debt owing by the firm to such creditor, and afterwards paid that debt, the party so depositing the collateral may recover the proceeds thereof, the creditor receiving it having in the mean time collected the same, notwithstanding there may remain other unadjusted claims due from the firm to such creditor, the firm being solvent at the time, and the separate property of one partner not being liable to be taken, in the first instance, to satisfy partnership debts.</p> <p>3. Sale of stocks—in hands of an agent. The owner of certain shares of stock in an insurance company, placed them in the hands of a person who was a member of. a partnership firm, and gave him a power of attorney to sell them. The stocks were transferred, for convenience, by this agent to the firm of which he was a member, and upon the question whether the firm had appropriated them to their own use so as to render them liable to to the owner therefor, as in case of a sale, it was held, upon the facts, there was no such appropriation, the firm, as such, never having had anything to do with the stocks, the transfers to and from the firm being the transactions of the individual partner, alone, who held the power of attorney.</p>