In re Gilbert

• Decision Date: 13 October 1896
• Citation: 68 N.W. 863,94 Wis. 108
• Parties: IN RE GILBERT ET AL. APPEAL OF CLEASBY ET AL.
• Court: Wisconsin Supreme Court

94 Wis. 108

68 N.W. 863

IN RE GILBERT ET AL. APPEAL OF CLEASBY ET AL.

Supreme Court of Wisconsin.

Oct. 13, 1896.

Appeal from circuit court, Trempealeau county; O. B. Wyman, Judge.

In the matter of the voluntary assignment of T. I. Gilbert and G. O. Gilbert, partners under the firm name of T. I. Gilbert & Co. From an order directing the sale of property by the assignee, William Cleasby and others, creditors, appeal. Affirmed.

This was an appeal from an order made in the matter of the assignment of T. I. Gilbert and G. O. Gilbert, partners under the name of T. I. Gilbert & Co., upon their petition and the petition of their assignee, one Trowbridge, as well as certain of their creditors, directing said assignee to sell certain property and assets assigned to him, and to apply the proceeds, and restraining certain of their judgment creditors from selling on execution certain real estate so assigned. It appears from the finding of facts, which was not contested at the argument, that the assignors, prior and up to the time of their assignment, January 13, 1894, had been doing a mercantile business at Blair, Wis., under the firm name of T. I. Gilbert & Co. On the 29th day of September, 1883, said firm entered into a co-partnership with one Hallenger, and carried on a branch store at Eleva, Wis., from that date until January 13, 1894, under the firm name and style of Gilbert & Hallenger; the capital, except that furnished by Hallenger, having been furnished by the firm of T. I. Gilbert & Co. as a partnership. The account between the firm of Gilbert & Hallenger, at Eleva, and the firm of T. I. Gilbert & Co. was kept on the books of Gilbert & Hallenger; with the firm of T. I. Gilbert & Co., in the name of the firm of T. I. Gilbert & Co., and not with the persons individually composing it; and the membersof the firm of Gilbert & Hallenger were said Hallenger and the firm of T. I. Gilbert & Co. Neither of the assignors, while in business as such firm, conducted any individual business, or acquired or had any individual property or assets when they made their assignment to said Trowbridge, and their assets were largely in excess of their liabilities as members of that firm; but the business of the firm of Gilbert & Hallenger had been so conducted that its liabilities were in excess of its assets, and of the assets of both firms combined, and the assignors were insolvent by reason of their liability as a firm for the debts of Gilbert & Hallenger. Gilbert & Hallenger made an assignment January 12, 1894, to S. D. Hubbard, for the benefit of their creditors, but the assets of that firm were only sufficient to pay a small per cent. of their indebtedness; and the assets of the assignors, T. I. Gilbert & Co., after paying their creditors on account of the business conducted by them at Blair, would not be sufficient to pay their liabilities on account of the business conducted at Eleva under the name of Gilbert & Hallenger, proved against said last-named firm, after deducting its assets. The assignors and their assignee, Trowbridge, and certain of their creditors, filed their several petitions for the sale and conversion into money of their assets so assigned to Trowbridge, and for the proper application of the same to the payment of their debts, and that certain creditors of the firm of Gilbert & Hallenger, who had also filed and proved their claims as debts against the estate of T. I. Gilbert & Co., and had thereafter commenced actions at law and obtained judgments therefor against said firm, and had attempted to levy upon its property and assets in the hands of said Trowbridge as assignee, and by garnishee proceedings to satisfy their said debts against Gilbert & Hallenger, be enjoined from prosecuting such suits or interfering with said property, and from selling certain real estate so assigned, upon which they had levied, or from interfering with said property so assigned, and that the court in the assignment proceedings should marshal the assets of T. I. Gilbert & Co., and that they be applied by their assignee in accordance with equity and the rights of the respective creditors. Certain other creditors of the firm of Gilbert & Hallenger prayed similar relief. The creditors thus proceeding against the assets and property of T. I. Gilbert & Co. answered said petition, and claimed the right to proceed at law in their suits against the assets not required for the payment of the debts contracted by them in their business at Blair under said firm name, to satisfy their liabilities incurred under the firm name of Gilbert & Hallenger in the business conducted at Eleva. The assignment of T. I. Gilbert & Co. provided that after the payment of all costs, charges, and expenses of executing the trust created, “and the payment and discharge in full of all other lawful debts due and owing by the assignors, of every kind and description,” proved against them, the residue should be returned, reassigned, and redelivered to the assignors. The court also found that the creditors making answer and opposing the petition had proved their claims against Gilbert & Hallenger, in the assignment proceedings of T. I. Gilbert & Co., as debts against that firm; that two of said creditors, after the making of such assignment, had obtained judgments on such claims, and made levies on executions thereunder upon the real estate of said T. I. Gilbert & Co., so assigned to the petitioner Trowbridge, and had advertised the same for sale. No attempt was made at the hearing to impeach the assignment of T. I. Gilbert & Co. as illegal or fraudulent, but its validity was conceded. The court granted an order in substance as stated, for the sale of the property and assets of T. I. Gilbert & Co. at public auction, and directed that after paying the expenses of the assignment the assignee should, out of the proceeds, pay all creditors of the assignors who had proved their claims growing out of the business carried on by them at Blair under the name of T. I. Gilbert & Co., in full, and that the remainder should be applied pro rata to the payment of the creditors of the assignors who became such by reason of the business conducted under the name of Gilbert & Hallenger at Eleva, and that the threatened sale of the real estate of the assignors upon executions in favor of contestants be restrained and enjoined. From this order the contesting creditors appealed.

Bleekman, Bloomingdale & Bergh and S. Richmond, for appellants.

John C. Gaveny, H. A. Anderson,...