The defendants had possession of some flour for sale under instructions from Perrin. The jury found that the sale was to be for the account of Perrin and one Shute and not Perrin alone, and that Perrin and Shute were joint tenants. Perrin committed an act of bankruptcy. The defendants afterwards sold the flour. Perrin was petitioned in and adjudicated bankrupt. The assignees in bankruptcy brought an action to recover the proceeds of the sale.
Held: The action could not succeed: ‘The defendants sold the goods in question after the bankruptcy by the direction of Shute; and I am of opinion that they were justified in so doing, since they had the authority of the solvent partner, who had a right to deal with the property as his own.’ (Parke) ‘Shute, the solvent partner, directed the defendants to sell the flour. Now it is clear that one tenant in common may dispose of the common property; and therefore, when the flour was sold by the defendants, it was properly sold so far as Shute was concerned. Then the effect of the bankruptcy was to render the assignees tenants in common of the goods with Shute. But it is well established that one tenant in common cannot maintain an action against his companion, unless there has been a destruction of the particular chattel or something equivalent to it. That being so, the defendants are not wrong doers, for they have acted under lawful authority. The case of Fox v. Hanbury (Cowp. 445), which was followed by Smith v Stokes (1 East, 363), Smith v. Oriell (1 East. 368), Harvey v. Crickett (5 M. and Selw. 336), and Woodbridge v. Swann (4 B. and Ad. 633) decided that, after an act of bankruptcy committed by one of two partners, the solvent partner is capable of disposing of the partnership property.’
Baron Parke dealt with the capacity of one tenant in common to maintain an action in conversion against his companions, and said that such an action was not maintainable unless there has been destruction of the particular chattel or something equivalent to its destruction.
Judges:
Pollock CB, Parke B
Citations:
(1853) 9 Exch 144, [1853] EngR 887, (1853) 9 Exch 145, (1853) 156 ER 62, (1853) 9 Exchequer 145
Links:
Jurisdiction:
England and Wales
Citing:
Cited – Fox v Hanbury 1776
One of two partners committed an act of bankruptcy. The solvent partner later disposed of partnership property to the defendant. A commission was afterwards issued against the bankrupt partner, and the plaintiffs as assignees under the commission . .
Cited – Smith v Stokes 1801
After a bankruptcy goods belonging to his partnership were received by the defendant Stokes. The commission in bankruptcy then issued. His partner died and his will was proved by Stokes and another. The assignees under the commission then brought an . .
Mentioned – Smith v Oriell 1801
. .
Cited by:
Cited – Re Dennis (A Bankrupt) CA 22-May-1995
A joint tenancy was severed (under the former law) on the event of an act of bankruptcy, and not only by the later actual adjudication of bankruptcy. The vesting of the debtor’s property in the trustee which occurred on adjudication was automatic; . .
Cited – Regina v Bonner and Others CACD 24-Feb-1970
The appellants challenged their convictions for theft, saying that as partners in a firm they could not be convicted of theft of partnership property.
Held: The appeals were allowed for the unsatisfactory and unsafe nature of the convictions . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Trusts
Updated: 05 December 2022; Ref: scu.566422