Sanderson v. Stockdale

Eccleston, J., delivered the opinion of this court. This appeal is taken, by the complainant, from an order of the circuit court for Baltimore city, refusing to grant an injunction and appoint a receiver. The bill was filed on the 19th day of September 1857, and alleges, that for some time prior to the 27th of June, and up to the 17lh of September, in the same year, the defendants had been doing business as partners, in the city of Baltimore, under the name and firm of Ulery, Stockdale &■ Co., and, as such, became indebted to the complainant in the sum of ⁵⁶⁸ $19,695, for hogs sold to them, for which the defendant, James Stockdale, executed and delivered to the complainant three promissory notes, signed in the partnership name, dated the 14th of July 1857, and amounting, in the aggregate, to the above mentioned sum; which notes have not been paid, two of them being over-due and protested before the filing of the bill, and the third falling due a few days after, which note, Stockdale informed the complainant, would not be paid at maturity. That the hogs have been sold by Stockdale, and he has received the money for them, as he has acknowledged.

The bill also alleges, that he promised to procure an endorser for the three notes, as an additional security for their payment, but he has failed and refused to do so; that having failed and refused to comply with that promise, Stockdale promised, in writing, on the 27th of July 1857, to give the complainant notes secured by mortgage, which he has since refused to do. That Ulery, Long and Cope are citizens and residents of the State of Pennsylvania-, and out of the reach of the process of the courts of Maryland; that the partnership is unable to meet its just liabilities, and is insolvent; that the notes of the firm have been protested, in the city of Baltimore, for non-payment. The bill also alleges, that the complainant has heard, and believes, that misunderstandings and unfriendly differences have arisen among the members of the partnership, with respect to the partnership property. And the complainant avers, that Stockdale has charged his partners with wrongfully withholding from the partnership property, funds and effects to the amount of forty-five thousand dollars, and carrying the same beyond the limits of this State; that Stockdale has attributed the embarrassed and insolvent condition of the partnership to this conduct of his partners.

The bill also states, that on the 17th of September 1857, an advertisement appeared in the Baltimore Sun, a newspaper published in that city, containing a notice of the dissolution of the partnership, signed by all the members of the firm, and stating that the partnership was dissolved on the 27th day of June 1857; that Long and Cope had disposed of all their interest in the partnership to Stockdale, who would liquidate the affairs of the late part ⁵⁶⁹ nership, and further stating that Stockdale and Ulery would continue the business, and pay all the debts of the late firm, and collect all that were due the same; which notice is alleged to be the first ever given to the public of the dissolution of the partnership, which had taken place nearly three months before, according to the advertisement, during all which time the business was conducted in the partnership name. The complainant also avers, he believes that the partnership effects have been misapplied, and appropriated to the private purposes of the individual partners, and that the creditors of the partnership have been thereby delayed, hindered and defrauded, and he charges that the pretended dissolution and assignment above mentioned, is a fraudulent device, designed still further to effectuate the same dishonest purpose of defeating the just claims of creditors, and misapplying and appropriating the partnership effects to the purposes of the individual partners. And it is averred, that unless Stockdale, Ulery, Long and Cope are arrested in prosecuting their said purpose, and prevented from carrying the same into effect, by the interposition of the court of equity, the complainant will sustain great and irreparable damage. And he alleges that he is informed, and believes, that Stockdale owns a large amount of real estate in the city of Baltimore and Baltimore county, and that the partnership of Ulery, Stockdale & Co., own real estate in the said county, but the complainant is unable to describe the same, and is ignorant of its value.

He also avers he has good reason to believe, and does believe, that the real estate belonging to Stockdale, and that belonging to the partnership just mentioned, may be conveyed away and disposed of, so as to be beyond the reach of their creditors, both individual and partnership, unless the court should interpose and prevent such disposition and conveyance. And the bill charges that Ulery, Stockdale, Long and Cope, have such a design in contemplation. The prayer of the bill is, that the defendants may be restrained, by an injunction, from carrying away, wasting, misapplying and disposing of the partnership funds and effects of the firm of Ulery, Stockdale & Co., or in any wise intermed ⁵⁷⁰ dling with the same, and that a receiver may be appointed tti take charge of them under the direction of the court; that the assignment mentioned to have been given, as stated in the advertisement óf the 17th of September, may be declared to be null and void; that an account of tire partnership of Ulery, Stockdale &■ Co., may be taken, and a decree passed for the payment of the complainant’s claim out of the said partnership effects and estate, and if they shall be found insufficient to pay the same, that the individual partners may be decreed to pay the balance remaining unpaid out of their separate estate, and that Stockdale may be enjoined and prohibited from alienating, selling and conveying away, or in any wise incumbering his personal and real property in the city of Baltimore and Baltimore county, or elsewhere, if he has any, and that he shall discover whether he has any, and that he shall give a description of the same, and a statement of its value, and be decreed to mortgage the same to the complainant, to secure his said debt, or that the same be sold for the payment of the same, or to pay such portion as the said Stockdale may be rightfully chargeable with by the rules of equity and good conscience, or that he may mortgage the same for such portion of the said debt as it may be right he should secure by mortgage; and that the complainant may have such other and further relief as his case may require, and as to right may appertain. With the bill were filed, as exhibits therein mentioned, copies of the three notes, a copy of the letter alleged to have been written by Stockdale, in which he promised to give a mortgage, and also a copy of the advertisement of the dissolution of partnership.

On the 24th of September 1857, were filed two of said notes, with the protests of them, and the letter from Stockdale, mentioned in the bill, with an affidavit of the complainant, stating those two notes and the letter to be the originals which' they purport to be, and that the third note was not then due, but would be due and payable on the 25th of September 1857, and had been deposited in bank for collection. There was also filed an affidavit of Henry Webster, one of ⁵⁷¹ the complainant’s solicitors, dated the 24th of September 1857, Stating that on or about the 10th of the same month, the deponent was consulted by the complainant in relation to his claim against the defendants; that subsequently, before the 17th day of.thc same mouth, he had several interviews with James Stockdale, one of the defendants, about the same matter; that he said the debt mentioned by the complainant in his bill, and secured by the notes, as therein stated, was bona fide, and should be paid, every dollar of it; that the said partnership was about to be dissolved, and he wanted more time to pay it; that lie bed settled with his partners, to whom he did not owe a dollar, and that they had just withdrawn forty-five thousand dollars out of the firm, which was the cause of its then embarrassment, and inability to pay its debts. Stockdale further stated, that his partners had become dissatisfied with his management of their business; that they could not agree about it, and that the firm would be dissolved on Friday, the 18th day of September 1857, before which day he wished to arrange for an extension of time upon the complainant’s claim, by renewing the notes of the firm, and securing their payment by sundry parcels of property and securities belonging to him, Stockdale, which he proposed to transfer to the complainant, for that purpose. The deponent further states, that the complainant offered to extend tire time of payment of his claim as proposed, hut when the deponent had prepared some of the papers to consummate the arrangement, Stockdale changed his mind, and insisted that- if the extended notes should not be met at maturity, the complainant should accept the property offered as security absolutely i» payment, and return the notes to him; which the complainant declined to do.

The deponent also states, that the notes mentioned in the bill were referred to by Stockdale as having been issued for hogs sold by the. complainant to said Sms, in the