Clay v. Freeman - 118 U.S. 97 (1886)
U.S. Supreme Court
Clay v. Freeman, 118 U.S. 97 (1886)
Clay v. Freeman
Submitted January 12, 1886
Decided April 26, 1886
118 U.S. 97
The surviving partner of a partnership, after payment of the partnership debts, may retain the partnership property until the indebtedness of the firm to him is paid if no proceedings are taken against him to enforce a settlement; in such case, if the statute of limitations runs against anybody, it is against the representatives of the deceased partner.
A and B became partners in 1855 for the purpose of carrying on a plantation in Mississippi owned by them jointly as partners. B furnished the larger part of the capital, and received the firm's notes for the amount advanced by him in excess of A's advances. A died in 1859, and his administrator and B carried on the partnership business until the outbreak of the war, without a settlement. In July, 1867, B died, having been for some time administrator of A (but without receiving any property or filing any account), and leaving surviving his sole heir and daughter P, who became of age in November, 1869. On the death of B, C was appointed administrator of each estate, and obtained a decree of court for sale of the real estate. It was struck off at the sale to P in December, 1869; the amount of the purchase money was credited on the partnership notes, and P entered into possession; but the whole proceeding subsequently proved to be illegal and invalid, and the supposed sale and transfer to be void. In 1876, dower in the estate was allotted to the widow of A in a proceeding in which P contested her right to it. In 1880, the widow began suit, which is still pending, to recover damages for dower, and about the same time, the heir at law of A, having come of age, sued to recover an undivided half interest in the real estate, claiming that the partnership debts were outlawed. P then brought this bill in equity to settle the partnership business and to charge all the real estate, including the undivided interest of the heir at law of A therein, and the interest of the widow, with the partnership debts. Held, that the statute of limitations could not be set up by the heir at law of A or by the widow against P; that P was the proper party to bring the suit; that the cancellation of the sale restored P to her rights as partnership creditor, and that while the court would not set aside the assignment of dower, no further exaction for detention would be enforced.
In equity. The case is stated in the opinion of the Court.