Buckingham v. First Nat. Bank

Citations

• 131 F. 192
• 65 C.C.A. 498
• 1904 U.S. App. LEXIS 4276

Syllabus

<p>1. Bankruptcy — Partnership—Evidence to Establish.</p> <p>Two men for a number of years conducted a business under a partnership agreement by which each agreed to bring into the business as rapidly as practicable all money he should be able to control, and not to withdraw, without the consent of the other, more than necessary to support his family. It was also provided that each was to have a certain interest in the business, and, to equalize the capital, interest should be allowed annually. All the capital was contributed by one, and, the business having been conducted during the later years at a loss, the other, by agreement, drew out a fixed sum per month for living expanses. Held, that such arrangement constituted a partnership), and that, on the bankruptcy of the concern, the capital employed in the business and the debts incurred therein were firm property and debts, and not those of the partner who furnished the capital.</p> <p>2. Same — Individual Debts — Firm and Individual Estates.</p> <p>Holders of notes of a bankrupt partnership, also indorsed by the individual partners, may, at their election, prove the same as individual debts of one of the partners, and, under Bankr. Act July 1, 1898, c. 511, § 5f, 30 Stat. 518 [IT. S. Comp. St. 1901, p. 3424], are entitled to payment in full from his estate before any part of the same is applied on firm debts, at least where there are substantial firm assets; and it is immaterial that all the capital of the partnership was also contributed by such partner.</p> <p>3. Same — Indebtedness of Partner to Firm.</p> <p>A finding by a referee, affirmed by the District Court, that a partner in a bankrupt firm was not indebted to the partnership on account of money drawn out, which was less than he was entitled to draw under the partnership agreement, held sustained by the evidence.</p>