17 Cal. 262 | Cal. | 1861
Baldwin, J. and Cope, J. concurring.
This is a suit on the equity side of the Court to quiet, or rather to perfect, the title of the plaintiffs to certain premises situated within the city of San Francisco. The facts of the case, as established by the evidence embodied in the record, are briefly as follows. In 1847, the defendants, Percy B. Shelly and Samuel Norris, were copartners in mercantile business in San Francisco. In July of that year the authorities of that town sold at public auction certain beach and water lots; and at the sale the defendant Norris bid off the premises described in the complaint—designated as lot number one hundred and eighteen—in the firm name of Shelly & Norris, fof six hundred and twenty dollars. Of this sum he paid at the time, to the first Alcalde for the town, one hundred and fifty-five dollars, and the defendant Shelly executed, in the name of the firm, an undertaking—in the form of a bond, but without any seal
Shelly never returned to San Francisco until some time in the year 1854, and he then learned all the particulars of the affairs of the old firm, and of the sale of the premises in question, and made no objection to the course pursued by his partner. In 1856, Norris related to him in detail the manner in which the copartnership effects and lot were disposed of and the accounts settled, and he then expressed his entire satisfaction with what had been done.
In May, 1859, Shelly executed a conveyance of all his right, title and interest in the premises in question, to the defendant
The principal ground upon which the defendants rely for a reversal of the judgment is, the alleged want of authority in Norris to execute a conveyance so as to pass the entire interest of the co-partnership in the premises. The proposition asserted is, that the copartners were tenants in common of this real property, and that neither could transfer the interest of the other; in other words, that the rule of copartnership, by which each individual member possesses full authority to dispose of the entirety of particular personal effects of the firm, and not merely of his own share, does not prevail with respect to real property; but as to this kind of property, all the members must unite in the conveyance to transfer the entire interest. Such is, undoubtedly, the rule at law, but in equity a different doctrine prevails. In equity, real property acquired with partnership funds for partnership purposes is regarded as personal estate, so far as the payment of partnership debts and the adjustment of partnership rights are concerned. The real and.
Under the special circumstances of this case—Shelly having absconded with all the available funds of the firm, leaving Norris without sufficient means to pay the debts of the copartnership, and the personal property having been, in good faith, first exhausted and found to be insufficient—it is not perceived why the same rule which governs as to the authority of the surviving partner should not apply. We are of the opinion that it does apply; and that under the circumstances stated, the equitable right and interest to the one undivided half, the legal title of which stood in Shelly’s name, passed by the conveyance to Davis; and that the plaintiffs, representing Davis, and succeeding to his rights, are entitled to come into equity to compel a conveyance of the legal title from Shelly, or parties taking a conveyance from him with notice of its partnership character. Nor is this opinion in conflict with the doctrine that real property of a copartnership may be conveyed by one partner, on bis individual account, to the extent of bis legal title, so as to cut off the equitable rights of the copartnership, or its liability to the payment of the copartnership debts. A Iona fide purchaser, for a valuable consideration, without
We have considered this case thus far without reference to the. civil law, which was in force in this State at the time the conveyance to Davis was made. The counsel of the appellants suggested on the argument, that the doctrines of that law differ with reference to the transaction in question from the equitable doctrines invoked under our system; but, if correct in this particular, he has entirely failed to show us in what respect the difference exists. We think, however, the learned counsel is mistaken. So far as the merits of the case are concerned, there is nothing in the civil law which exempted the real property in question, or rather, the right by the contract to demand such property upon the payment of the balance of the purchase money, from appropriation to the discharge of the copartnership obligations; and it having been in good faith appropriated in that way, it would be a reproach to the administration of justice if, under the circumstances of the case, and the subsequent approval of the disposition made by Norris, a court of equity would permit Shelly, Baker and Leavenworth to succeed in their attempt to deprive the plaintiffs of it after they have occupied it for years, and made it valuable by large expenditures.
The other grounds taken by the defendants are without merit. Norris was a competent witness, under the statute, for the plaintiffs, being a defendant in the suit.
There was no error in refusing to dismiss the suit as to Leavenworth and Shelly, even if they disclaimed as to any interest in the
Judgment affirmed.