U. S. District Court.-Gardner and others v. Isaacson.

is given, no further step is to be taken in court in order to subject the respondent to its authority, or secure the fulfilment of judgments or decrees.

The counsel for the respondents contend, that as they remained in the custody of the marshal till the return day of the process, and then gave stipulations for their appearance under the rules of the District Court, they are entitled to be discharged from arrest, and are not bound to execute the bond or stipulation prescribed by the Supreme Court Rule, (1) for the reason, that the bond demanded is in the nature of bail to the sheriff, on an arrest at common law, and cannot be exacted after the return day of the writ, as the party is then in court, and thus satisfies the condition under which the bond might have been required; and (2) that Rule 46 of the Supreme Court saves the application and effect of the District Court rules, the mode of appearing not being fixed or regulated by Rule 3, or (3) that Rule 25 leaves cases situated as these are to the discretion of the court, to compel stipulation for costs only.

The analogy of the common law practice, is not a very close one, but so far as it goes, the argument from it, rather tends to oppose than support the conclusion sought to be established by the respond

ents.

The bail to the sheriff is like the civil law stipulation in judicio sisti.

It only aims to secure the appearance of the person in court. But the sheriff is not exonerated merely by producing the body. He must hold the party in custody, until another and more stringent undertaking is entered into by him, consummating his appearance according to the course of the court.

So here, merely having the respondent under his authority on the return day of the process, or producing him in facie curiae, in no way satisfies the warrant of arrest, or exonerates the marshal. The process necessarily continues in life and acting upon the defendant, until he fulfils the purpose of the arrest. That most plainly is designed by the rule of the Supreme Court to compel him to furnish a stipulation in the terms there given; and to that end, the arrest must necessarily continue in force, because the warrant of arrest according to the rule is executed in that manner alone.

In the view I take of the subject, the matter is specifically provided for by Rule 3 of the Supreme Court, and there is accordingly nothing in these cases, out of that rule, coming within the policy of Rule 46 of the court, and remaining under the authority of this court.

But even upon this construction of the rules, it is argued for the respondents that Rule 25 of the Supreme Court, applies to the cases, and relieves the party from liability or his security other than for costs, and whether that shall be exacted, is left to the discretion of this court.

The terms of that rule are, that, in all cases of libels in personam, the court may in its discretion, upon the appearance of the defendant, where no bail bas been taken, and no attachment of property has

U. S. District Court.-Gardner and others v. Isaacson.

been made to answer the exigency of the suit, require the defendant to give a stipulation with sureties in such sum as the court shall direct to pay all costs and expenses which shall be awarded against him in the suit upon the final adjudication thereof or by any interlocutory order in the process of the suit.

This rule evidently has relation to the different modes of bringing a defendant before the court, designated by the second rule. If he is proceeded against by citation or summons only, there is no compulsory authority acting upon him, and the libellant neither against his person or his estate has any security for the demand in prosecution. All that is imposed on the defendant by the rules, in such case, is, that he shall indemnify the libellant against the costs to be created by his interposing a defence and contestation to the action.

But in the coercive method of procedure by arrest of the body or attachment of property the warrant being executed, Rule 25 in no just interpretation, can be understood as intended to deprive the libellant of the security thereby acquired, and set the defendant or his property free from the arrest, on a mere stipulation for costs.

Acting under the authority of this rule, the court could not add the condition that the defendant should surrender himself for commitment, and if it is interpreted according to the argument in this case, a defendant need only, when arrested, refuse to give bail before the return day of the warrant, and then he will be entitled to a free discharge on the stipulation for costs, and thus all the privileges and securities provided by the rules of the Supreme Court, as consequent to his arrest, will be abrogated.

I am satisfied such construction of the rules cannot be sustained. It was obviously the purpose of the Supreme Court to place the admiralty practice, in each of the U. S. courts, substantially on the footing of the English practice. That practice, under the first process act, in 1789, was adopted by Congress. (1 U. S. Stat. 93.) It had remained essentially the rule of practice, since that period in the various district courts but some deviations from it existed. (10 Wheat. 486.) The Supreme Court designed, by Rules 2 and 3, to abolish such diversities of practice, and render the remedies and rights of parties uniform in causes of admiralty and maritime jurisdiction, in every court of the Union.

The letter and spirit of the regulations of the Supreme Court, in my judgment, require that a defendant in custody under a warrant of arrest, in an admiralty case, shall so remain until he makes his appearance by giving bond or stipulation to satisfy the decree that may be rendered against him.

It is urged that the acts of Congress abolishing imprisonment for debt govern this procedure, and that the U. S. courts have now no authority to hold parties under arrest on mere civil process.

The acts of 1839 and 1841 (5, U. S. Stats. 321 and 410) abolish imprisonment for debt, on process issuing out of any court of the United States, in all cases whatever, where, by the laws of the State

U. S. District Court.-Gardner and others v. Isaacson.

in which the said court shall be held, imprisonment for debt has been, or shall hereafter be abolished.

The act to abolish imprisonment for debt, was passed in this State April 26, 1831, and it enacts that no person shall be arrested or imprisoned on any civil process issuing out of any court of law, or on any execution issuing out of any court of equity, in any suit for the recovery of money, &c. (1 Re. Stat, 807 1.) This statute is made the law of the U. States also, by force the acts of Congress above referred to, and had the proceeding in these causes been on the law side of the District or Circuit Court, the defendant would have been exempt from liability to arrest.

The principle of the act, would seem to include arrests by maritime courts on matters of contract and for the recovery of money, no less than when made by courts of law. But the words of the statute do not embrace both. They are limited to civil process issuing out of a court of law, and the legislature found it necessarry to provide expressly for executions issuing out of chancery, as not embraced within the previous description of process, from a court of law; much less can a maritime court be regarded as falling within the designation. The acts of Congress of 1789, 1792, and 1793, demonstrate that laws relating to the practice of courts of law do not include that of admiralty and maritime jurisdiction.

Non-imprisonment acts of the tenor of that passed in this State had been very common, indeed almost universal throughout the United States previous to the promulgation of the code of rules by the Supreme Court in 1844. That court, by the rules adopted, necessarily construed those acts as not affecting proceedings in maritime courts, and accordingly the antecedent authority of that description of process is continued in force.

It is unnecessary, and might be unbecoming now to intimate what order this court would feel itself authorized or required to take, if the question was an open one, as to the effect of the State Statutes upon its process, under the provisions of the acts of Congress of 1839 and 1841 alone. The duty of the inferior court is limited to receiving and executing the law given by its superior, and the highest tribunal of the land, having authorized the process employed in this case, I shall forbear any further general reasoning upon the subject and hold it valid, and accordingly, on all the points raised, deny the motion of the defendants for their discharge.

N. Y. Superior Court.-Hayes v. Bement and others.

N. Y. Superior Court.-In Equity.

Before DUER, MASON and CAMPBELL, Justices.

THOMAS T. HAYES V. EDWARD BEMENT and others.

Where a special partnership becomes insolvent, and the special partner is a general partner in another firm, which latter firm is a creditor of the special partnership, the debt due such firm is not postponed, nor the interest of the special partner in such debt.

THE facts appear in the opinion.

Horace F. Clark for complainant.

Ketchum and Fessenden for defendants.

By the Court.-CAMPBELL, J.-Thomas T. Hayes, the complainant loaned his note for $2000, to the special copartnership of Hayes & Heyer. The note was payable to the order of, and endorsed by Hayes & Heyer as first endorsers, and by Ketchum, Rogers & Bement as second endorsers. It was discounted at a bank in Connecticut, and the proceeds were paid over to Hayes & Heyer. This latter firm having failed, and made an assignment to Bement, Ketchum, Rogers & Bement, were charged as endorsers, and were compelled to take up the note. They caused proceedings to be instituted, and recovered a judgment against Thomas T. Hayes the maker. This judgment they sought to enforce by execution, but it still remains unpaid, except to the extent of five hundred dollars, being the amount of a dividend declared by the assignee of Hayes & Heyer.

Morris Ketchum, a member of the firm of Ketchum, Rogers & Bement, was also the special partner in the copartnership trading under the name of Hayes & Heyer, and the former firm were large creditors of the latter. It appears that the assets of Hayes & Heyer in the hands of the receiver, would be sufficient to pay all their debts, excluding the debt due to Ketchum, Rogers & Bement.

The complainant filed this bill mainly for the purpose of compelling a postponement of the debt due Ketchum, Rogers & Bement, until the creditors are paid in full, or if not the whole debt, then the interest of Morris Ketchum, the special partner of Hayes & Heyer, in the debt due Ketchum, Rogers & Bement.

The provisions of the statute on which the complainant relies, ( 23, 1 R. S., page 767,) are as follows:

"In case of the insolvency or bankruptcy of the partnership, no special partner shall under any circumstances be allowed to claim as a creditor until the claims of all the other creditors of the partnership shall be satisfied."

We are not aware that this question has before arisen in our state, and we have therefore listened with attention to the extended argu

N. Y. Superior Court.-Hayes v. Bement and others.

ments which were advanced, and we have endeavored to give to the subject a full and careful consideration. At the same time we think that the question is measurably free from difficulty, and that it may be satisfactorily settled upon the general principles of the law of copartnership, and according to the ordinary and customary proceedings under insolvent and bankrupt laws. Let us suppose that Mr. Ketchum, instead of being the special, had been a general partner in the firm of Hayes & Heyer. Then if an act had been passed declaring that in case of the insolvency or bankruptcy of that firm, he, the said Morris Ketchum, should under no circumstances be allowed to claim as a creditor until the claims of all the other creditors of the firm should be satisfied such enactment would merely repeat what is the well-established rule under the law of copartnership. As the law is established and recognised, no general partner can under any circumstances claim as a creditor in his own right until all the other creditors in the firm are paid, when such firm has become insolvent. We apprehend, therefore, that the provisions of the act in relation to limited partnerships simply place the special partner, so far as he is a creditor, upon the same footing as if he were a general partner. In both cases the partner must wait until all the other creditors are paid. If he be a general partner, and there is deficiency, he must lose his capital and his debt, and must in addition make up the deficiency from his private fortune. If he be a special partner, he must lose his capital and his debt, but is not liable for the deficiency.

If the same person be a general partner in two different firms, one of which firms becomes insolvent or bankrupt while the other firm is solvent, and a creditor of the insolvent or bankrupt firm, then it is well settled that the creditor firm may recover its debt or its dividend from the insolvent or bankrupt firm, notwithstanding a member of the insolvent or bankrupt firm is also a member of the solvent creditor firm. (Collyer on Partnership, pages 573 &c., cases referred to.)

If the assets of the insolvent or bankrupt firm are insufficient to pay and discharge their liabilities, then undoubtedly their creditors may reach the interest of the partner in the partnership property of the creditor firm, and that upon the plain principle that such partner is liable for all the debts of the insolvent or bankrupt firm. But that interest must be reached by calling the creditor firm to account. The insolvency or bankruptcy of one of its members may operate as a dissolution of the firm. Its creditors may be different, and they must be first satisfied; when the liabilities are discharged, if any interest remains belonging to the bankrupt partner, it would of course be applied to the extinguishment of his individual liabilities, or his liabilities as a member of the bankrupt firm. But as we have before remarked, his liability as a member of the bankrupt firm would not necessarily prevent the creditor firm from recovering their debt or their dividend from the bankrupt firm. We come then to the case before us, and Mr. Ketchum being a member of the creditor firm of Ketchum, Rogers & Bement, that firm may recover their dividend