73 Cal. 389 | Cal. | 1887
Ejectment for an undivided seven tenths of a mine.
On November 13, 1880, and subsequently, Richard F. Knox, Joseph Osborne, W. T. Robinson, S. P. Ely, and Phillip V. R. Ely were mining partners engaged in working the Esperance mine, the legal title to which stood as follows: Eight tenths in Knox and Osborne (one of these eight tenths being held in trust for Robinson), three twentieths in S. P. Ely, and one twentieth in Phillip V. R. Ely. On December 13, 1880, Knox and Osborne mortgaged their seven tenths to the plaintiff. It does not appear whether or not this mortgage was recorded. On October 10,1882, the property as mortgaged was sold under a decree of foreclosure. Although the defendants were parties to the suit, the decree reserved the question as to the priority of their judgment mentioned below. The plaintiff became the purchaser at the sale, and in due time obtained the sheriff’s deed.
The defendants’ title is as follows: Between February 28,1881, and September 12th of the same year, the partnership became indebted to the defendants for supplies furnished, and money paid in and about the working of
An appeal was taken from this judgment, but no stay of execution was had, and pending the appeal execution was issued, and on February 27, 1882, the property was sold to the defendants, who, after the usual period, received the sheriff’s deed. Upon the appeal it was held that the action was not brought under section 388 of the Code of Civil Procedure in relation to persons transacting business under a common name; and that section 414 of the code did not authorize a judgment ■ against the joint property; and that inasmuch as the two Elys had not been served with process, and had not appeared, the judgment should be modified by striking out their names. The court did not, however, order the clause above quoted as to the joint property to be stricken out. (Davidson v. Knox, 67 Cal. 143.)
The court below gave judgment for the defendants, upon the theory that partnership creditors have a priority against creditors of individual partners. We think this was erroneous, for two reasons:—
1. Even if it be assumed in favor of respondents that the judgment in Davidson v. Knox could be enforced against the joint property of the partners, it does not follow that the purchasers at an execution sale under this judgment acquired the legal title as against the appellant’s, mortgage. Conceding the rule as to the priority of firm creditors to its fullest extent, it is, at all events, so far as real property is concerned, a rule of equity, and not of law. (See Duryea v. Burt, 28 Cal. 580.) The priority is worked out through the hm of the partners. (Jones v. Parsons, 25 Cal. 104, 05; Story on Partnership, sec. 97.) And if it be true ihat the purchaser of a specific tract at a sheriff’s sale under a judgment at law is subrogated to this lien, it must be asserted by appropriate proceedings in equity, and cannot avail him in an action at law, where the equitable rights are not set up. (See Ross v. Heintzen, 36 Cal. 320; McCauley v. Fulton, 44 Cal. 362; and compare Allen v. Phelps, 4 Cal. 258, 259.)
2. But the judgment in Davidson v. Knox was not against all the partners, nor could it be enforced against their joint property. This was held upon the appeal in that case. (67 Cal. 143.) It is true that the execution sale took place before this decision was rendered, and was under the judgment before it was modi
We think that upon the evidence the court below should have rendered judgment in favor of the plaintiff for seven tenths of the property. And we therefore advise that the judgment and order appealed from be reversed, and cause remanded for a new trial.
— For the reasons given in the foregoing opinion, the judgment and order are reversed, and cause remanded for a new trial.
Hearing in Bank denied.
