Schoenfeld et al. v. Heman & Co.

his indorsement, and being unacquainted with their character and solvency, he went to defendants in error, who were bankers, and asked them in relation to the character and solvency of Gellenbeck & Co., and they falsely and fraudulently represented that Gellenbeck & Co. were a solvent firm and in good standing, and relying solely on these representations he indorsed the note. He alleges that Gellenbeck & Co. were at the time in failing circumstances and unworthy of credit and that defendants in error knew it, and he asks to be discharged.

On the trial before a jury, the plaintiff, Schoenfeld, stated that he had indorsed a note for the Gellenbecks for a like amount, which was held by the defendants in error, and of which the note sued on was a renewal.

The original note became due on the 31st January, 1869— the date of the note sued on-and the Gellenbecks told him on the morning of that day they could not pay it, and wanted him to indorse the note sued on. He thereupon went to the office of defendants in error and saw Heman, whom he had never seen before, and told him he had come to see about a note on which Frank Gellenbeck was indorser. He also told Heman that the parties wanted to renew the note, and that he did not like to indorse it; to which Heman replied that the Gellenbecks had some trouble with one Varwig, from whom they were compelled to take a mortgage, and that was the reason why they did not pay the note; that Henry Gellenbeck was of no account, but that if George Gellenbeck said so it was all right. It seems the plaintiff in error went to George Gellenbeck to see if what Heman said was right, and George said "yes," and thereupon he wrote his name on the back of the note sued on; and that at this time the Gellenbecks had property out of which the original note could have been made. When the note sued on fell due the Gellenbecks were insolvent. Schoenfeld did not procure the discount of the original note or get any of the proceeds of it.

Heman testified that when the first note was offered for

Schoenfeld et al. v. Heman & Co.

discount he inquired about Schoenfeld and found him responsible as well as the elder Gellenbeck. When it fell due Schoenfeld came to see him, but he does not remember the conversation Schoenfeld details, but that it is his impression he did not make the statements as testified to by Schoenfeld. On this state of the case the parties agreed that the jury might render a verdict for the defendants in error, subject to the opinion of the court upon the law of the case; and thereupon Schoenfeld filed a motion for a new trial: first, because the court misdirected the jury; second, because the verdict was contrary to the evidence; and third, because it was contrary to the law.

On the hearing of the motion for a new trial affidavits of both Heman and Schoenfeld were read, which do not materially change the statements made before the jury, except some variations of the statements of both parties, which do not affect the substantial question in the case. There is a professional statement of counsel, which was addressed to the discretion of the court, in connection with the affidavits of the parties containing cumulative testimony only, which the judge at Special Term did not think sufficient to authorize him to grant the motion for new trial, and he accordingly overruled the same and entered judgment on the verdict.

The assignment of errors is a repetition of the reasons for a new trial. There does not appear any exception to the charge of the court, and we are not disposed to disturb the verdict of the jury on the evidence, for we think that the verdict was right.

But it is said that the judgment is erroneous in this; that the liability charged in the petition against the plaintiff in error is that of an indorser and not that of a guarantor or joint maker, which in fact it was; and that although the defendants in error might have amended their petition, to make it conform to the facts proved, and though the judgment might then have been good, still it is now too late to amend, and the judgment is bad. It is said that if Schoen

Gaylord & Co. v. Imhoff and another.

feld be a guarantor he had no sufficient notice of the default of the principals, Gellenbeck & Co. To this last it will be sufficient to say, that at the maturity of the note the Gellenbecks are admitted to have been insolvent; besides, the plaintiff in error had sufficient notice.

The plaintiff in error seems, at no previous time, to have called any attention to the variance between the pleadings and proofs, and may be deemed to have waived it, because there is no assignment of errors broad enough to cover it.

Our Supreme Court has frequently held that the error must not only appear affirmatively, but must be specifically pointed out. This the party has not done. Armstrong v. Clark, 17 Ohio, 495; Little Miami Railroad Co. v. Collett, 6 Ohio St. 182.

The judgment must be affirmed.

T. G. GAYLORD & Co. v. IMHOFF AND ANOTHER, Partners.*

Individual members of an insolvent copartnership, not the owners of other property, are severally entitled to the exemption allowed by the State "Homestead Laws," out of the partnership fund, even as against creditors of the firm.

The object of exemption and homestead laws discussed and defined.

In this cause judgment was recovered, the property of the defendants sold on execution, and the proceeds were in court for distribution.

A judgment was made by the judgment debtors, claiming the benefit of the exemption allowed them by law as heads of families and residents of Ohio, setting out that neither of them were the owners of homesteads, or possessed of other

Though this case was decided at a prior term to the one with which these reports were begun, but at the request of members of the bar who deemed the questions contained to be of great interest and importance, it is inserted here.

Gaylord & Co. v. Imhoff and another.

property, as provided by the amendment of May 22, 1858, to the "Homestead Law."

An agreed statement of facts was filed by the counsel for the parties, "that all the property levied on and sold was partnership property, including the leasehold; and that the affidavit and demand of exemption by the defendants were filed by the defendants with the sheriff before the sale, setting forth that they were heads of families, and not the owners of homesteads or any other property."

The copartnership creditors resisted the claim on the ground the property belonged exclusively to the creditors of the firm, and was subject to the payment of all the firm debts before the individual partners could have any legal right to the joint assets.

All the questions arising under the motion were reserved for the opinion of the court in General Term.

Matthews & Ramsey, for the motion.

Challen & Mitchell, contra.

STORER, J. As a general rule, the objection urged to the right of partners to a share of the joint assets before the partnership debts are satisfied is the true one; but the case before us is one where both the partners, who were originally interested in the fund now in court, apply for the exemption allowed by law; neither can be said to sustain the same relation to the other, which would exist, if one were solvent and the other insolvent, for in such case the burden. which ought to be borne by both would be imposed upon him alone who had the ability to discharge it.

A copartnership creditor, as such, has no better lien on the property of the firm than the creditor of an individual partner. To use the language of the books, he can only work out whatever right he may assert through the partners themselves. And hence it is in marshaling the fund where all the parties are before the court, we are permit

Gaylord & Co. v. Imhoff and another.

ted to appropriate it in the first place to the creditors of the firm.

In a contest between creditors where no intervening right exists, there can be no difficulty in coming to a correct conclusion. We are asked, however, to hold that the homestead and exemption laws, which were enacted for a kindred purpose, can not apply to a case like that at bar, on the assumption that when capital has become invested in a joint adventure, either the identity of the original individual owner, with his share of the common property, is lost, or he must await the winding up of the partnership, when all the liabilities having been discharged, the statutory privilege may then be allowed him. This argument would defeat the object of the law, in that the debtor, if owing as an individual, would be permitted to enjoy the exemption, while his joint liability with others would give the creditor the power to take the last farthing of his substance.

It is urged that dower will not be granted where the estate in which it is asked belongs to a partnership, until all the liabilities of the firm have been met, and we admit the rule, though it has been modified by late decisions; but this has been determined on the ground that the property, though legally vested by deed in the partners, is held nevertheless in trust for the payment of debts. This rule is not now, nor has itever been the law in Ohio as to personalty; no matter how large the decedent's indebtedness may be, his widow is allowed a reasonable sum for her year's support, to the exclusion of all creditors. The property sold by the sheriff, the proceeds of which are now in court, was machinery in a manufacturing establishment and a leasehold for a term of years.

Can there be any greater equity, on the part of those to whom a copartnership is indebted, than that the creditors of an individual might claim, when we are asked to give a construction to a statute, the object of which, before it can be fully carried out, requires us so to interpret it as to effect the humane purpose for which it was enacted? We