Maughlin v. Tyler

Miller, J., delivered the opinion of the Court. This suit was brought against three persons as partners, for lumber sold to them by the plaintiff. There was no dispute as to the claim sued on and whatever may have been the relations of the defendants inter sese it was clearly proved, and in fact conceded, that they were partners as to third parties, and that the plaintiff dealt with ⁵⁴⁹ and trusted them as such. The defence was rested entirely upon a release executed by the plaintiff in pursuance of the terms of a deed of trust for the benefit of creditors, made by one of the defendants.

This deed conveys “all the lands, tenements, goods and chattels, dioses in action, book-accounts, bills receivable, moneys, and other matters and things whereof the” grantor “is seized or possessed, or in any manner interested in or entitled to,” and exacts releases, and creates a preference in favor of the releasing creditors. It is proved the other defendants not only did not assent but objected to its being made. The release under seal signed by the plaintiff and others in consideration of the preferences given by the deed, is to the effect that the plaintiff does £ £ hereby release the said ’ ’ grantor “ from all claims or demands he may have against him, and. agrees to accept of such sums of money or dividends as may accrue to him under the deed of assignment, in full satisfaction of said claims or demands.” The plaintiff admitted that at the time he signed this release, he had no other claim of any kind against the defendants, or any one of them either in their joint or individual capacity, except the one sued on. Is this release a bar to this action?

In our opinion, and for the reasons we shall briefly state, it is not. It has been settled by a series of decisions in this State, that a deed of trust for the benefit of creditors, creating preferences and exacting releases, is void unless it appears on its face, to convey all the property of the debtor, and where such a deed is executed by partners, it must so appear to convey both their partnership effects, and their individual estates. Maennel vs. Murdock, 13 Md., 177 ; Citizens’ Ins. Co. vs. Wallis, et al., 23 Md., 173 .

In the case last cited, the deed was held void because it did not convey the individual property of the grantors. Here the deed also creates preferences and stipulates for releases, but conveys only the individual property of the grantor, ⁵⁵⁰ and does not in terms profess to convey partnership property. If these parties were actual partners inter sese and the terms of the deed should be regarded as broad enough to include the property of the partnership, still it was not signed by the other partners who were present at the time, but was executed against their protest, and in that case, even if it had professed to assign all the partnership property, the decided weight of authority is against the power of one partner to make such a disposition of the partnership effects. 1 Amer. Lead.

Cases, (5th Ed.,) 551; Burrill on Assignments, secs. 68 to 86. But assuming these parties were not actually partners inter sese and that the grantor in this deed owned in his own right all the property of the ostensible partnership, and that the terms of the deed embrace it, still as we have said, they occupied towards third parties the relation of partners, and this deed is set up as against the claim of a creditor of this ostensible firm. Occupying that relation, the deed to be .operative as against such a claim must convey the