Articles of partnership having provided, that on dissolution by death, notice, or misconduct, of a partner, the remaining partners should have the option of taking his share at a valuation, payable by yearly instalments in the course of seven years: and that on the bankruptcy or insolvency of a partner, the partnership should be immiediately void as to him ; by a deed, four years subsequent, the partners declared (after a recital that such was their intention in the articles), that in the event of bankruptcy or insolvency, the same arrangement should be practised as on dissolution by death, notice, or misconduct : one of the partners having become bankrupt within a few months after the execution of the latter deed, his assignees are not bound by it. Whether a provision in articles of partnership, that on the bankruptcy of a partner his share shall be taken by the solvent partners, at a sum to be fixed by valuation, and payable by installments in a course of years, is not void by the statutes concerning bankrupts.
An owner of property may, on alienation, qualify the interest of his alienee, by a condition to take effect on bankruptcy; but cannot, by contract or otherwise, qualify his own interest by a like condition, determining or controlling it in the event of his own bankruptcy, to the disappointment or delay of his creditors.
Judges:
Lord Eldon LC
Citations:
[1818] EngR 607, (1818) 1 Swans 471, (1818) 36 ER 469
Links:
Cited by:
See Also – Wilson v Greenwood 17-Jul-1818
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Cited – Belmont Park Investments Pty Ltd v BNY Corporate Trustee Services Ltd and Another SC 27-Jul-2011
Complex financial instruments insured the indebtedness of Lehman Brothers. On that company’s insolvency a claim was made. It was said that provisions in the documents offended the rule against the anti-deprivation rule. The courts below had upheld . .
Lists of cited by and citing cases may be incomplete.
Insolvency
Updated: 02 May 2022; Ref: scu.332607