tary or involuntary proceedings, irrespective of any adjudication of the individual partners as bankrupt, and upon an adjudication to draw to the administration the individual estates of the partners as well as the partnership estates, and marshal and distribute them according to equity." Relying upon this dictum, the court in In re Stokes,1 when the firm alone had been adjudged bankrupt and each of the two partners had previously made an assignment of his individual estate for the benefit of creditors, made a summary order upon the assignees of the non-bankrupt partners to transfer the individual property in their hands to the trustee in bankruptcy. Again, in Dickas v. Barnes,2 the firm had committed an act of bankruptcy by making an assignment for the benefit of its creditors. Some of the partners had participated in making the assignment, and some of them had made individual assignments. Some of the members were adjudged bankrupt, as was also the firm. Some of the members were not adjudged bankrupt, two because they had not committed any act of bankruptcy, and two because they were not subject to involuntary bankruptcy-one being a wage-earner and the other a tiller of the soil. The court ordered all the partners, whether adjudged bankrupts or not, to file schedules of their debts and inventories of their property, and to turn over all their property to the trustee in bankruptcy to be administered as if each of them had been adjudged bankrupts.

The orders in these two cases seem high-handed, and to be defended, if at all, only on the ground of necessity. Is such an order necessary for the protection of the firm creditors, with whom alone the court would seem to be concerned in the bankruptcy of the firm? A firm creditor's interest in the property of the non-bankrupt partner is simply that it may be subjected to the payment of his claim, and this end can be attained by an action against the non-bankrupt partner, who can interpose no defense on the ground that the firm is in bankruptcy. In the converse case of the bankruptcy of a partner without the firm being bankrupt, the Act provides that unless the other partners consent, the firm property shall not be administered in bankruptcy, but that the nonbankrupt partners shall settle the partnership business and account for the interest of the bankrupt partner. There is nothing here to

1106 Fed. Rep. 312.

3 Bankr. Act of 1898, § 5 h.

2 140 Fed. Rep. 849.

prevent a firm creditor in such a case from suing the non-bankrupt partners, and if the justice of the claim were denied it would indeed be their duty to contest it. Nor is there anything in the Act to prevent a firm creditor from suing a non-bankrupt partner when the firm alone is adjudged bankrupt.1 Still less than the interest of the firm creditor, does the interest of the individual creditor of the non-bankrupt partner require such orders as were made in the two cases above mentioned. It is certainly to the interest of the individual creditor that he should be left perfectly free to enforce his claim against his debtor's property by action, attachment, and execution. It therefore appears that the summary order really hinders both the firm creditors and the individual creditor from prosecuting their rights against their debtor who is not a bankrupt.

It is to be remembered that the nature of the liability of the members of a firm continues to be the same, although the Bankrupt Act provides for the bankruptcy of the firm as an entity; that is, a liability directly to the firm creditors. Even in countries where the firm is recognized as an entity for all purposes, it is the general rule that the partners are liable in solido, although in most of these countries the enforcement of the liability is de

1 The bankruptcy court could not stay these actions under § 11 a of the Act. That section reads as follows: "A suit which is founded upon a claim from which a discharge would be a release, and which is pending against a person at the time of the filing of a petition against him, shall be stayed until after an adjudication or the dismissal of the petition; if such person is adjudged a bankrupt, such action may be further stayed until twelve months after the date of such adjudication, or if within that time such person applies for a discharge, then until the question of such discharge is determined." This section relates only to suits against persons against whom a petition in bankruptcy has been filed, and in respect to a claim which will be released by a discharge, and is evidently inapplicable to persons who have been found not to be subject to the bankruptcy laws, whether because they have committed no act of bankruptcy or because they have been excepted from its operation. Where an action was brought in a state court against two partners and one of them was afterwards adjudged a bankrupt, he was held to be entitled to a continuance of the action until the question of his discharge should be determined. But a motion by the other partner for a continuance was denied and the action proceeded against him. Hogendobler v. Lyon, 12 Kan. 276. Under a provision of the English Bankruptcy Act, similar to Act of 1898, § 11 a, above quoted, it was held that when a firm creditor had sued the partnership and had attached its goods, and one of the partners afterwards filed a petition for liquidation under the Bankruptcy Act, the court had no jurisdiction to restrain the action. Ex parte Isaac, L. R. 6 Ch. 58.

2 See Codes de Commerce, France, Art. 22; Italy, Art. 106; Spain, Art. 127; Hungary, Art. 88; Roumania, Art. 106; Portugal, Art. 105, 153; Switzerland, Art. 544; Russia, Art. 77; Belgium, Loi du 18 Mai 1873, Art. 17; Germany, Art. 128; Holland, Art. 18.

pendent upon certain preliminary proceedings against the firm.1 Yet where the bankruptcy of the firm does not necessarily involve the bankruptcy of the members of the firm, we find no country in which such a course of procedure is followed as that adopted in the cases under discussion.

In Germany the partners are personally liable to creditors for the debts of the firm.2 But although an independent bankruptcy proceeding can be instituted against the firm property, yet the bankruptcy of the firm does not involve the bankruptcy of the partner. By Article 122 of the former Handelsgesetzbuch, the firm creditors in case of the bankruptcy of the firm could have recourse against the individual property of the partners only for what remained unpaid after application of the firm property to their claims. This limitation was applicable not only when the partner was in bankruptcy, but also when he was not, thus preventing the firm creditors from pursuing a non-bankrupt partner pending the ascertainment of the deficiency in firm assets. Article 122 was not re-enacted in the new Handelsgesetzbuch, but by Article 212 of the Konkursordnung it was provided that in case a partner was

1 In Italy, Art. 106, the firm creditor must exhaust his action against the firm before he can sue the partners. So in Roumania, Art. 106, and in Portugal, Art. 153. In Switzerland, Art. 564, the partners can be called upon for payment of firm debts only after dissolution, or after the firm has been unsuccessfully pursued. In Spain, Art. 237, the separate property of a partner cannot be seized for a firm debt until after seizure of the firm property. In Belgium, Loi du Mai 1873, Art. 122, no judgment can be rendered against the partners until after judgment against the firm. In Scotland the debt must first be "constituted" against the firm, and it can then "be enforced against the members as guarantees bound conjunctly and severally with their principal"; as soon as the debt is constituted against the firm, execution is competent against any one of the partners. 1 Clark, Partnership, 285, 627.

In France, according to some authorities, the partner can be sued personally only after judgment against the firm, according to others, only after exhaustion of the firm assets, and according to others, after a demand made in certain ways. Sirey, Code de Commerce, 3 ed. 38, no 52; Lyon-Caen et Renault, Droit Commercial, t. 2, no 281. In Louisiana, although the ultimate liability of the partners is in solido, during the life of the partnership they cannot be charged individually, except through the partnership, which alone can be sued for a partnership debt. Liverpool, etc., Nav. Co. v. Agar, 14 Fed. Rep. 615. In Germany, however, no preliminary steps against the firm are necessary before action against the partners. Handelsgesetzbuch, Art. 128, 129; I Behrend, Handelsrecht, § 73. The creditor may sue the firm and then the partners, or the firm and partners at the same time, separately or in the same action, or only the partners or any one of them. A judgment against the firm alone cannot be enforced against the individual partners, but they must in such case be sued separately. I Lehmann-Ring, Handelsgesetzbuch, 277, Nr. 10; Handelsgesetzbuch, Art. 129. 2 Handelsgesetzbuch, Art. 128.

* Konkursordnung, Art. 209.

adjudged a bankrupt, then the firm creditor could seek satisfaction from the separate estate of the bankrupt partner only for what he had failed to get from the partnership estate. As the law of Germany now stands, where only the firm is in bankruptcy the creditors of the firm are deprived of no rights against the individual partners, but may sue them and proceed to judgment and execution against the private property just as before the bankruptcy of the firm.1

Although differing in some respects, the German law of partnership more closely resembles our law than that of any other country examined. In Germany, as in this country, the partners are personally liable to the full extent, and no preliminary proceedings against the firm as such are necessary to establish the liability of the partners. As in many of our states, the partnership may sue and be sued in the firm name. In Germany the firm can be declared bankrupt without any of the partners being made bankrupt, and vice versa. Since the passage of the Bankrupt Act of 1898, this is also our law. But in Germany the bankruptcy of the firm alone has no effect upon the separate property of the partners. It is not seized and administered in the firm bankruptcy, nor is even the property of another partnership composed of the same members. Unless the individual partner is put into separate bankruptcy his property remains in his hands and is subject to direct attacks by his creditors, both firm and individual. This seems the logical result of a law which makes partners individually liable and at the same time provides for the bankruptcy of the firm apart from the bankruptcy of its members. A law under which the bankruptcy of the firm draws after it the bankruptcy of the members and so brings both firm and separate estates to be administered at the same time, is comprehensible, but, in a jurisdiction where the bankruptcy of the firm does not entail that of the partners, it seems illogical for the court administering the estate of a bankrupt firm to seize or order the surrender of the property of the non-bankrupt partners. The business of the bankruptcy court is to distribute the property of bankrupt debtors, which property may consist of real estate and personal property, including choses in action. But for the court to have

1 Lehmann-Ring, Handelsgesetzbuch, 313, Nr. 5; Sarwey-Bossert, Konkursordnung, 497, Nr. 2.

2 Lehmann-Ring, Handelsgesetzbuch, 312, Nr. 2; 280, Nr. 6; Burchardt, Feststellung im Konkurse, 86, 87.

jurisdiction to deal with property it must belong to the bankrupt. It can get possession of the tangible property of the bankrupt by summary order on those holding it, but it cannot reduce a chose in action to possession by a summary order on the bankrupt's debtor commanding him to turn over enough property to pay it. The trustee must sue to collect the debt. By the summary order in the cases discussed the court does not take possession of any property belonging to the bankrupt, for the property of the nonbankrupt partner does not belong to the firm. The summary order upheld by the Supreme Court in Mueller v. Nugent1 was directed to those who, without honest claim or right, withheld property of the bankrupt, not property which it was conceded belonged to the person holding it.2

It is true that it is also the business of the court to pay the debts of the bankrupt, but how? With the property of the bankrupt, not with the property of third persons. The fact that the debts of the firm are also debts of the non-bankrupt partners should no more give the court power over the property of the nonbankrupt partner than the bankruptcy of one of two joint debtors should authorize the court to seize the property of the non-bankrupt joint debtor. If the bankrupt's trustee has paid more than the bankrupt's share of the debt, he may, no doubt, sue the nonbankrupt joint debtor for contribution, but the court of bankruptcy would never order the non-bankrupt to turn over his property to the trustee either before or after such payment by the trustee.

In the case of In re Beauchamp, Kay, L. J., said, “ A receiving order is only to be made as a step towards an adjudication of bankruptcy, and when you cannot have an adjudication of bankruptcy, it seems to me that you ought not to obtain a receiving order. To allow this receiving order to stand would be in effect to put in

1 184 U. S. 1.

2 See also the case of Louisville Trust Co. v. Comingor, 184 U. S. 18, in which it was held that the court cannot by a summary order compel the payment to the trustee of money which is claimed to be the lawful property of the person against whom the order is directed. When the fact of an honest claim appears, the court can go no further under the order, but must leave the trustee to pursue his remedy in the customary mode of proceeding in the proper court. Nor was the case made any better for the trustee by reason of the fact that the person withholding the money had been made a party to the petition in bankruptcy, although no cause of action was set up and no special relief was prayed against him. See also Jaquith v. Rowley, 188 U. S. 620; In re Michie, 116 Fed. Rep. 749. [1894] Q. B. 1, 8.