
    
      W. B. Wilson, et al., Assignees, vs. Administrators of S. L. McConnell. Thomas F. Woolridge vs. Admin’rs of S. L. McConnell and Mary C. McConnell.
    Where a husband dies insolvent, his widow has the right to require his administrators to apply the personal estate to a specialty debt secured by a mortgage of land, given before the marriage, so- as to subject the land to her claim of dower, discharged from the incumbrance of the mortgage.
    Where a copartner, having a separate estate, dies, the eo-partnership creditors have the right first to exhaust the co-partnership estate, and if that prove insufficient to pay their demands, then they are to be paid from the separate estate of the copartner pro raía with his separate creditors.
    In ascertaining the pro rata due a copartnership creditor from the sepa, rate estate of a deceased copartner, who died insolvent, the debt should be regarded as standing in the precise condition in which it stood at the death of the copartner, without regard to any subsequent payments derived from the copartnership assets; though, to avoid double satisfaction, such creditor is not entitled to receive more than the balance due, after deducting such payments.
    A debt due the copartnership by a deceased copartner is to be proved against his estate as any other separate debt.
    BEFORE DUNKIN, OH., AT YORK, JUNE SITTINGS, 1857.
    This case came before the Court on exceptions to the report of the Commissioner. So much of the report as relates to the questions decided by the Court of Appeals is as follows:
    “ In this case, at June Term, 1856, the following order was made:
    “ ‘ On motion of Smith, complainant’s solicitor, and by consent of Williams and Beatty, defendants’ solicitors, ordered, that tbe administrators of Samuel L. McConnell, account before the Commissioner for the administration of the estate of their intestate; that the Commissioner take an account of the real estate, or the proceeds of the sale thereof, which have been sold by order of this Court; and of the liens thereon ; that the Commissioner inquire and report whether Mary C. McConnell, widow of said intestate, is entitled to any part of the proceeds of sale, of any of the real estate of Samuel L. McConnell, in lieu of her dower, and of what particular tracts, and if so entitled, the amount due her as to each.; that he report the order in which the creditors are entitled to payment out of the real and personal assets of intestate; that said Commissioner take an account of the sum due complainant, T. E. Woolridge on his judgment, mentioned in the pleadings, and that he report any special matter in relation to any of said matters; that the Commissioner call in the creditors to prove their demands before him by advertisement in the Gazette, by a day to be fixed by him, and that all creditors of the intestate, whether parties to the suit or not, upon notice of this decree, forbear and be restrained and enjoined from proceedings at law or equity or otherwise, than herein provided, for the recovery of their debts, with leave to creditors to apply for the suspension or modification of this order. It is further ordered, that W. A. Latta, as to his mortgage debt against intestate, be exempted from the operation of the injunction herein ordered. June 21st, 1856.’
    “ In obedience to the foregoing order, I have inquired into the said several matters so referred to me, and beg leave to submit the following report: ‘ The administrators of Samuel L. McConnell, have accounted before me for their administration, and herewith filed, is a statement of the same.
    “ ‘At the time of the death of said Samuel L. McConnell, he was seized and possessed of the following real estate: A tract of land in York district, on Bullock creek, containing one thousand four hundred and forty acres, more or less.
    “ ‘ This tract was subject to the lien of a mortgage, in favor of W. A. Latta, for the sum of twenty-five thousand dollars, dated the 28th of March, 1853, given to secure the payment of said McConnell’s four sealed notes, to said Latta. One for eight thousand five hundred dollars, due 1st January, 1854, with interest on twenty-five thousand dollars, from 1st July, 1853 ; one for six thousand seven hundred and fifty dollars, due the 1st January, 1855, with interest on sixteen thousand five hundred dollars, from 1st January, 1854; one for four thousand eight hundred and seventy-five dollars, due the 1st January, 1856, with interest on nine thousand seven hundred and fifty dollars, from 1st January, 1855 ; and one for four thousand eight hundred and seventy-five dollars, due 1st January, 1857, with interest from 1st January, 1856. After the death of McConnell, Latta filed his bill to foreclose said mortgage, and on the 2nd October, 1854, said lands were sold under the decree of this Court for that purpose. The whole amount due to Latta on said mortgage and notes, has been satisfied. The payments have been made partly by the administrators and partly out of the sales of the mortgaged lands. Latta, himself was a purchaser of a part of the mortgaged premises, and I have applied the amounts due on his bonds given for the purchase money, when due, in satisfaction pro tanto, of so much of the mortgaged debt.
    “1 On the proceedings commenced by Latta, the widow, Mary C. McConnell, was made a party. She .claimed dower in said lands. She interposed no objection to the sale, but claimed compensation for her dower out of the sales ; and at June Term, 1854,1 was ordered to inquire and report whether said widow was entitled to any part of the proceeds of sale, of said mortgaged premises, in lieu of her dower, and if so, the amount. On the 18th June, 1856, I made a report, recommending that she be paid the sum of one thousand eight hundred and nine dollars, and that tbe said amount should be paid to her by the administrators, as a, much larger amount than said sum, over and above what the administrators had paid, was applicable out of the personal estate to the payment of the mortgage, and sealed notes due to the said Latta, according to their legal priority. Said report was confirmed at June Term, 1856, and the said administrators ordered to pay said amount to the widow. As against Latta, the widow would not be entitled to dower until the mortgage debt was paid; his mortgage being given to secure the payment of specialty demands, he was entitled by law to payment of said notes out of the personal estate, according to their legal priority. It is true, that he had a lien on the land, for his whole debt; so had the widow for dower, a lien on the land, and in my opinion she has an equity to' compel him to look to the personal estate for the payment of his debt, so far as said estate may be liable, and if he has received out of the sales of the mortgaged land, according to the foregoing principles, more than his share thereof, then she should be compensated out of the personal estate. Accordingly, I have ascertained, what sums were applicable to said mortgage debts out of the personal estate, deducted the same from the mortgage debts, and then applied a sufficiency of the sales of the mortgaged premises to pay the balance of said mortgage. In making up the accounts in this way, a large surplus of the sales of said mortgaged premises remains, to one-sixth of which she is entitled in lieu of her dower. I, therefore, report that she is entitled, in lieu of her dower in said lands, to the sum of one thousand eight hundred and nine dollars, with interest thereon, from the 15th June, 1856.
    ‘“In my report above alluded to, oh the said matter, I made a full statement of the whole estate of S. L. McConnell, together with my reasons for allowing said claim of dower; and to avoid unnecessary labor and re-casting the whole accounts, I bave made that report tbe basis of tbis report in regard to said claim of dower, and herewith file a copy of said report marked D.
    
    
      
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      “ ‘ Tbe creditors of tbe said S. L. McConnell, were called in to establish tbeir claims, and herewith filed is a statement of the specialty debts due by said S. L. McConnell, and still remaining unpaid: also a statement of simple contract debts due by bim.
    “ ‘ Shortly after tbe death of S. L. McConnell, Jerome C. Miller, the survivor of McConnell and Miller, made an assignment of the partnership assets, and also of his individual property to W. B. Wilson and A. E. McConnell. By the terms of the assignment, the partnership assets are first to be applied to the payment of debts due by the firm to Wardlaw, Walker and Burnside, and to Caldwell, Blakely & Co.; and then to the payment of other debts due and owing by the firm. Said assets are wholly insufficient to pay the preferred claims. Jerome C. Miller’s individual property was assigned to pay first his own individual debts, and then to be applied to the payment of all other demands for which he was liable. His individual debts have been paid, but the amount in the hands of his assignees will be wholly insufficient to pay the debts of McConnell & Miller. Under these circumstances, the said creditors of McConnell & Miller claim to establish their partnership debts against Samuel L. McConnell’s estate, and to be paid rateably with his other simple contract creditors. Herewith, filed, is a statement of said copartnership debts, so established before me.
    “1S. L. McConnell was largely indebted to the firm of McConnell & Miller, and the assignees of Jerome C. Miller, survivor, present the amounts so due by him, as a claim against the estate of S. L. McConnell, to be paid rateably with other simple contract debts. Said Jerome C. Miller, is insolvent; and I am of opinion that tbe amount due to bim by said Samuel L. McConnell, as above stated, and also the outstanding debts due by McConnell & Miller, should rank as simple contract debts against the estate of S. L. McConnell.’ ”
    Williams and Beatty, for. themselves and other creditors of Samuel L. McConnell, excepted to-the report of the commissioner, in the following particulars:
    1. Because the commissioner has recommended the partnership debts of McConnell and Miller to be paid out of the estate of S. L. McConnell, the deceased partner, pari passu with the individual and separate debts of said S. L. McConnell, when, at the death of said S. L. McConnell, there was partnership property which was properly applicable to the payment of partnership debts, and J. 0. Miller, the surviving partner in fact applied said partnership property to the payment of partnership debts.
    2. Because, if any of the creditors of McConnell & Miller, are to be allowed payment of their claims out of the estate of McConnell, pari passu with his individual and separate creditors, Wardlaw, Walker and Burnside, and Caldwell, Blakely & Co., should not be so allowed, only on conditions of adding to the estate of S. L. McConnell, applicable to the payment of simple contract debts, the amount received by them from the partnership assets since McConnell’s death, and letting both of said funds be divided amongst the simple contract creditors of S. L. McConnell.
    8. Because, under the assignment of J. C. Miller, surviving partner of McConnell & Miller, of his individual estate to W. B. Wilson and A. E. McConnell, it is provided that his own individual debts are to be paid first; and then the whole balance of his estate is to be applied to the payment of debts for which he was in any manner liable for other persons, as surety, endorser, or partner; and in ascertaining the pro rata shares of the creditors of McConnell and Miller, of the separate estate of S. L. McConnell, the amount to which they are entitled under said assignment, should be deducted before the demands are brought into the general account, which was not done, and in this, it is submitted, the said commissioner erred.
    4. Because the commissioner has recommended the amount due to J. 0. Miller, from S. L. McConnell’s estate, on account taken between said partners, J. C. Miller and S. L. McConnell, to rank in equal degree with the separate simple contract debts of S. L. McConnell, in the administration of the estate, and be paid pari passu with them.
    The -complainants, Stanley Eewell and John Barnes, excepted to the commissioner’s report, on the ground, inter alia:
    
    1. Because Mary C. McConnell is allowed any sum whatever, as compensation for dower in the Latta land, as the land sold for a sum insufficient to satisfy the mortgage, to the vendor to secure the purchase money, given before the marriage, and simultaneous with the deed to intestate; she is entitled to dower only out of any surplus over and above the mortgage. Dower being a lien on the land, and not a charge upon the general funds of the estate, she has no equity to have any portion of the mortgage paid out of-the personal estate, and as to all such sums paid by the administrators, the general creditors are entitled to stand in the place of the mortgage by reason of special lien.
    The decree of his Honor, the presiding Chancellor, is as follows ?
    Dunkin', Ch. Samuel L. McConnell and Jerome C. Miller, were co-partners as grocers, in York District. Samuel L. McConnell died intestate, 19th September, 1858, leaving a widow, the defendant, Mary C. McConnell, and a child, in ventre sa mere, who was since born. On 24th September, 1853, Jerome C. Miller, as surviving co-partner, executed an assignment of the assets of McConnell & Miller, to the plaintiffs in tlie cause first stated, for the benefit, in the first place, of certain preferred creditors of the firm. Letters of administration on the individual estate of Samuel L. McConnell, deceased, were granted to the defendants, George W. Williams and Jerome C. Miller.
    The object of the first bill is to pray that an account be taken as between the parties, and that an alleged balance of some twenty thousand dollars due by the deceased co-partner to the firm, may be paid out of his estate. The bill in the name of Thomas E. Woolridge, is a creditor’s bill, praying that the assets of the estate of Samuel L. McConnell, deceased, may be marshalled, and in this view, the administrators of the intestate, and the widow, (in reference to her claim of dower) are made parties defendant.
    A decretal order of reference was made at June sitting, 1856; and the cause was now heard upon the commissioner’s report, and the exceptions of the several parties.
    In the case of the assignees of McConnell & Miller, against the representatives of McConnell, an order of reference had been made in June, 1855, as to the amount due by the intestate to the firm, with leave to the plaintiffs to examine Jerome C. Miller, the surviving partner, on said reference. On 17th June, 1856, the commissioner reported the debt of Samuel L. McConnell to the firm, at fourteen thousand one hundred and eighty-nine dollars and forty-four cents, with interest from the 19th September, 1853 ; whereupon, it was ordered that the debt, as reported, stand proved ; subject to the right of any contestant to contest the same. The order . under which the report now to be considered was made, bears date 21st June, 1856, and is entitled in the creditor’s suit of “Wo.olridge vs. Mary C. McConnell and others.” This order is recited in the commissioner’s report, filed 8th June, 1857.
    It may be convenient, in the first place, to consider and dispose of those exceptions which challenge the right of the assignees of McConnell and Miller, to rank with the individual creditors of Samuel L. McConnell, deceased, in the distribution of his assets. — This subject was fully considered by the Court of Appeals, in the recent case of Gadsden vs. Garson, heard at Charleston, January, 1857. Among other things, it is said by the Court, “ a partnership creditor has a right to be paid, not only out of the joint property of the firm, but also out of the property of the individual partners. The private creditor, who has only one fund to resort to, has an equity to compel the partnership creditor who has two, to resort first to partnership assets until he exhaust them. But after this is done, the partnership creditor has as good a right to be paid any balance still remaining unsatisfied, out of the private property of the partner, as any other of his individual creditors. This is in conformity to the case of Wardlaw vs. Gray, (Dudley, 113,) with which we see no reason to be dissatisfied.”
    The only interest which Samuel L. McConnell’s estate would have in the partnership assets, would be his share of the dry balance after the co-partnership debts were paid.— But the assets of the firm are wholly insufficient to pay the debts. The plaintiffs are, therefore, entitled to rank with the other simple contract creditors of Samuel L. McConnell, deceased, for the amount of their debt as heretofore established. See also, Gowan vs. Tvm.no, Rich. Eq. Cases, 377. Such would be the law if the plaintiffs were merely creditors of McConnell & Miller; but a debt due by S. L. McConnell, is as much his individual debt, as that due by him to any other firm or person.
    The assignees of Jerome C. Miller, surviving partner of. McConnell & Miller, except on the ground that the commissioner has not included the sales of the “ Styles ” tract of land as part of the co-partnership assets. The intestate purchased this land and took the conveyance in his own name. Under proceedings instituted by Ms administrators, Gr. "W. Williams and J. 0. Miller, against the widow and heirs of McConnell, the land was sold by the commissioner as part of his estate, in Aug. 1854. It is now suggested, that although the conveyance was in the name of McConnell, he made the purchase on account of the firm, and this, as it appears to the Court, rests on a loose statement of a witness that McConnell paid his purchase out of the funds which he drew from the firm, and for which amount the assignees have obtained a decree against McConnell’s estate in June, 1856. — If McConnell had, after the purchase, told half-a-dozen witnesses that he purchased for the firm, such parol declaration would not prove the trust, as is well illustrated by Lord Roslin in Foster vs. Hale, 3 Yes. 707. The Statute of Erauds does not require that the trust should be created in writing, but that it shall be manifested and proved by writing. But it is said McConnell paid for the land with money which he drew from the firm. Of itself this would no more entitle the co partnership to the land, than it would entitle the Bank of Chester, if he had chanced to pay for the land on a note discounted at that institution. McConnell & Miller were co-partners as grocers. It is not surmised that the “ Styles ” tract of land was necessary, or convenient for their operations in trade. But all the material facts were well known to the assignees in June, 1856, when the report establishing their debt at' fourteen thousand one hundred and eighty-nine dollars, and including this item, was ordered, at their instance, to stand as a debt in the administration of assets of the intestate. In the judg* ment of this Court, the assignees, at that time, took a correct view of their rights, and they ought not now to be at liberty to insist that the report of June, 1856, was erroneous, and that they had no such debt as they then established by the judgment of the Court. The exceptions on this point are overruled.
    The creditors of Samuel L. McConnell except, because dower is recommended to be allowed out of the sales of the Latta tract of land. The facts are fully detailed in the report of the commissioner in the case of Wm. A. Latta, against the personal representatives, as well as widow and heirs of Samuel L. McConnell, deceased. The report recommended the allowance of dower, on certain principles therein stated, and the report was confirmed and made the judgment of the Court at June sitting, 1856. Allowing that the creditors of McConnell may now show error in that judgment or granting (as is more probable), that it should be considered conclusive only as to the amount, reserving the question of rights; the Court is of opinion that the judgment may be well sustained on principle. The mortgage to Latta was to secure the purchase money, and was also executed prior to the marriage of intestate. In England, and by the common law, a widow, under such circumstances, was held not entitled to dower. The conveyance to the vendee, and the immediate re-conveyance by way of mortgage, was held not to create such seizin in the husband, as would render his widow dowable. Upon this principle was decided the case of Bogie vs. Rutledge, 1 Bay, 812. But the effect of the transaction between mortgagor and mortgagee, was altered by the Act of 1791. The seizin of the husband was, thenceforth, not instantaneous. But the re-conveyance to the mortgagee was declared not to entitle him to maintain any possessory action for the real estate mortgaged, even after the time of payment had elapsed: “ but that the mortgagor shall still be deemed owner of the land, and the mortgagee as owner of the money lent or due.” 5 Stat. 170.
    According to repeated decisions under this Act, the widow has been held entitled to dower in lands mortgaged for the purchase money, but that her right is subordinate to the lien of the mortgage; Stopplebein vs. Shulte, 1 Hill, 200. In some cases, it is said, she is “ entitled to dower against all but the mortgagee.” Her situation is not different from that of a wife, who has renounced her dower on a mortgage executed by her husband, to secure any debt. Seized of an estate worth ten thousand dollars, he executes a mortgage to secure a debt of two thousand dollars, on which mortgage his wife executes a renunciation of dower. This affects her right only in relation to the mortgage. If the debt is paid, her right is perfect. Nor does it make any difference whether the debt be paid by the husband in his lifetime, or by his representatives after his decease. In Bolton vs. Ballard, 13 Mass. R. 330, Chief Justice Parker, used this language in an analogous case. “ There is no reason why she, the wife, should not be placed in a situation which may enable her to redeem, or hold the estate if it be otherwise redeemed, as it may be by the mortgagee’s pursuing his remedy for his debt, against the personal estate of the husband after his decease.” And in Snow vs. Stephens, 15 Mass. R. 279, the widow was held entitled to dower, where the debt was paid by the administrator of the mortgagor. It seems to be argued, as if Latta had an estate in the mortgaged premises to the extent of his debt, or that, on the death of the intestate, he was obliged to resort to his mortgage. But any such view is inconsistent with Francis v. Lehfe, 1 Rich. Eq. 271. The land in that case, was mortgaged to secure a bond given for the purchase money. The Court ruled, that the personal estate was the primary fund for the payment of debts, and that the .executor should pay the bond from the assets in his hands, and that the mortgaged premises should be resorted to only on a deficiency of assets. Then it was suggested, that the simple contract creditors had an equity to compel the bond creditors to take payment out of the land, so as to leave the personalty for the satisfaction of their demands. But this claim to derange the legal administration of assets, is met by a correspondent equity on the part of the widow, who is entitled to the position of a purchaser for valuable consideration against all but existing liens. It is therefore, the duty of the personal representative of the intestate, to marshal the assets in the mode 'prescribed by law, and to pay the mortgaged debt according to its rank.
    It is entirely consistent with these principles, that in a suit at law, by the widow against a purchaser to recover dower, under such circumstances, where the estate of the husband is insolvent, as in Brown vs. Duncan, 4 McO. 346, the amount due on the incumbrance is deducted from the value of the land in the assessment of dower. The purchaser whose land is liable for the debt, is entitled to this equity. But if the debt be paid by the husband, in his life time, or by his representatives in due course of administration after his death, the effect is the same. The encumbrance being removed in consequence of the payment of the debt by the party properly liable, the right of dower is perfect and subject to no modification.
    According to the report of the Commissioner, a part of Latta’s bond was paid from the personal assets, "and the deficiency satisfied from the proceeds of the mortgaged premises. The amount of this deficiency has been deducted from the value in the assignment of the widow’s dower. In the opinion of the Court, there is no error in the judgment of the Commissioner, and the exception is overruled.
    The exception in relation to dower in the Metts land, would be ruled by the same principle. But her claim to dower in that tract may be vindicated on independent grounds. By the judgment in partition, the land was vested in the intestate, charged with the payment of ascertained sums to his five co-tenants. The land stood mortgaged for the payment of these sums. Four of the co-tenants were minors, of whom the intestate became’ guardian and gave them credit in his account, as guardian, for these sums. The remaining co-tenant was Mary Jane McConnell, who intermarried with ’W. D. Miller, and according to the Commissioner’s report, “ the intestate (S. L. McConnell) in his life time, settled in full with "W. D. Miller, who had intermarried with Mary J. McConnell.” The statutory mortgage was therefore as completely extinguished, and the right of dower as absolute, as if the husband had settled in full with his co-heirs on the day after the judgment in partition was rendered.
    This exception is overruled.
    The exception of W. D. Miller, is overruled for the reasons ■ stated in the report of the Commissioner, thereon.
    The report of the Commissioner on the several exceptions of Williams and Beatty for themselves and others, and on those of S. Eewell and John Barnes, furnishes a satisfactory answer to said exceptions, and the same are overruled.
    The Court is not satisfied as to the exception in behalf of John Barry. The Commissioner has cut off the value of three years services as “ barred.” The Court infers that the statute of limitations was relied on. But it is by no means certain that the statute applies between parties having mutually subsisting demands of this kind. See the remarks of Lord Kenyon as reported in Gatlin vs. Shoulding, 6 T. R. 141. Then as to the agreement of Eebruary, 1838, between A. McConnell and Barry, it amounted to no more than a mortgage to secure future advances. In the settlement of September, 1845, between Barry and S. L. McConnell, (who, it seems, was administrator of A. McConnell,) Barry was properly allowed the real value of the land. The Court agrees with the Commissioner that Barry is properly chargeable with legal interest on the advances, but the Court is not satisfied that his demands for services, as annually accrued, may not be properly set off against such interest. It may be that Barry would be precluded from objecting to the usury, but the Commissioner does not proceed on that assumption, if it were tenable. It is the opinion of the Court, that the subject matter of this exception should be recommitted for further enquiry, and that the Commissioner report thereon, with, leave to report any special circumstances. To meet this demand, if finally established, provision may be easily made. Except in relation to the claim of John Barry the several exceptions of the parties are overruled, and the report of the Commissioner is confirmed and made the judgment of this Court.
    It is ordered and decreed, that after the payment of the costs of these proceedings, and reserving a sufficient sum to pay the pro rata dividend on the claim of Barry (if hereafter established) the assets of the estate be paid and distributed according to the report of the Commissioner, and the principles of this decree. It is further ordered, that, on adjusting with the parties entitled, the Commissioner have leave to assign to each or any of them, the bonds, or any of them in his hands, which the said parties may be willing to receive in payment; any of the parties in the cause to have leave to apply at the foot of this decree, for such further and other order as may be necessary to carry the same into effect.
    Williams & Beatty for themselves, and other creditors of Samuel L. McConnell, appealed, and now moved this Court to reverse or modify the decree, on the grounds :
    •1. Because the Chancellor overruled appellants’ first exception to the Commissioner’s report, and decreed that the partnership debts of McConnell & Miller were to be paid rateably and pari passu with the simple contract debts of S. L. McConnell, out of his individual estate; when it is submitted, that as there were partnership assets at the death of S. L. McConnell, which have been exclusively applied to the payment of partnership debts, the individual creditors of S. L. McConnell, are entitled to priority in payment of their demands out of his estate over the partnership creditors.
    2. Because the Chancellor overruled appellants’ second exception to the Commissioner’s report, when, it is respectfully submitted, he erred therein; and that Caldwell Blakely & Co., and Wardlaw, Walker & Burnsides, who have received the whole partnership assets of McConnell & Miller, in part payment of their claims, ought not to be allowed payment of the balance of their claims, pari passu with S. L. McConnell’s individual and separate creditors out of his estate, unless they consent to add to the estate of S. L. McConnell, applicable to the payment of simple contract debts, the amounts received by them from the partnership assets, and let the whole of both funds be divided rateably amongst the simple contract creditors of S. L. McConnell, and McConnell and Miller.
    8. Because the Chancellor overruled appellants’ third exception to the Commissioner’s report, and decreed that the claims of the creditors of McConnell & Miller were to be brought into the account against S. L. McConnell’s estate, without deducting therefrom the sums applicable to them from the individual estate of the surviving partner, J. C. Miller, assigned by him to W. B. Wilson and A. F. McConnell. In this, it is respectfully submitted, the Chancellor erred.
    4. Because the Chancellor overruled appellants’ fourth exception, and decreed a large sum in favor of J. C. Miller, surviving partner, against S. L. McConnell’s estate. The greater part of the account so allowed, is for monies drawn from Wardlaw, Walker & Burnside, and Caldwell, Blakely & Co., on draughts of McConnell & Miller, but applied by S. L. McConnell to his own use; and it is submitted, that as Wardlaw, Walker & Co., and Caldwell, Blakely & Co., are allowed payment of said monies out of S. L. McConnell’s estate, Jerome C.' Miller is not to be allowed ..payment again; and the said Jerome C. Miller having contributed nothing to the capital of McConnell & Miller, and the said firm being insolvent and having made no profits, said J. G. Miller is entitled to no account.
    Complainant, Stanley Eewell, and other creditors of S. L. McConnell, also appealed on the ground inter alia:
    
    1. Because the Chancellor overruled the appellants’ first exception to the Commissioner’s report, and decreed that the administrators pay out of the personalty, to Mary C. McConnell, the sum recommended by the Commissioner, as compensation for dower in the Latta land, when it is submitted, she is not entitled to be paid any sum whatever for dower in said la'nds, inasmuch as at the death of her husband, her right to dower was subject to the encumbrance of Latta’s mortgage, given before her marriage, for the purchase money; the whole proceeds of the sale of the land having been, in fact, applied and exhausted in payment of the mortgage; the payments by the administrators on the mortgage not exceeding the balance remaining due after application of the sales, cannot operate as satisfaction of the encumbrance to entitle her to have as compensation for dower, any sum whatever out of the personalty.
    Williams, for Williams & Beatty.
    
      Smith, for Eewell.
    
      Wilson, Witherspoon, contra.
    
      
       The following is the report; referred to:
      
        " On the 28feh day of March, 1853, William A. Latta bargained and sold, and oonveyed to Samuel L. McConnell, a tract of land in York district, on Bullock creek, containing fourteen hundred and forty acres, more or less, and the horses, mules, cattle, hogs, sheep, wagons, and* implements of husbandry, then being on said plantation. He also conveyed at the same time, to S. L. McConnell, the use and services of nineteen slaves, then being on said plantation, until the first day of January, thence next ensuing, and sufficiency of corn and fodder for the use of said horses, mules and stock, until the crop of 1853 was fit for use. The consideration of said land, negroes, &c., so conveyed, was twenty-five thousand dollars; the land being estimated at twenty-one thousand, seven hundred dollars; the provisions furnished, at one thousand dollars; the horses, mules, cattle, plantation tools, &e., at fifteen hundred dollars; and the hire of the negroes at eighteen hundred dollars. To secure the payment of said sum of twenty-five thousand dollars, the said S. L. McConnell, on said 28th day of March, 1853, executed and delivered to Wm. A. Latta, his four sealed notes or obligations. One for eight thousand and five hundred dollars, due 1st January, 1854, with interest on twenty-five thousand dollars from the 1st of July, 1853. One for six thousand, seven hundred and fifty dollars, payable on 1st January, 1855, with interest on sixteen thousand, five hundred dollars, from 1st January, 1854. One for four thousand, eight hundred and seventy-five dollars, payable on the 1st January, 1856, with interest on nine thousand, seven hundred and fifty dollars, from 1st January, 1855. And one for four thousand, eight hundred and seventy-five dollars, with interest from 1st January, 1856, And the said Samuel L. McConnell, also, at the same time, to secure the payment of the said sealed notes, mortgaged the said land and other property conveyed to him as aforesaid, and pledged the crop to be made upon said plantation. After the conveyance and mortgage aforesaid, S. L. McConnell intermarried with the defendant, Mary C. McConnell. He made no payments in his lifetime, and died on the 19th of September, 1853. His estate is insufficient to pay all his debts, but entirely sufficient to pay all the specialty debts, including the four sealed notes due to Wm. A. Latta, as aforesaid. The widow claims compensation for her dower in said lands, either out of the sales of the mortgaged lands, or the personal estate. This is a question entirely between her and the simple contract creditors. It is conceded that as against Latta, she would not be entitled to dower, until the mortgage debt was paid. But the said Mary C. McConnell contends that the personal estate of said S. L. McConnell, is the primary fund for the payment of his debts, and that the said debts due to W. A. Latta, being specialty demands, should be paid rateably out of the personal estate, with the other specialty demands, and only the balance should be satisfied out of the sales of the land. This will leave a large surplus of said sales, to one-sixth of which she contends she is entitled, in lieu of her dower. It is said on the other hand, that Latta has a specific lien on the land for the payment of his debts, and that the other creditors of S. L. McConnell, have an equity to compel said Latta to exhaust his said lien, before resorting to any other part of the estate for payment. The claim of dower is one highly favored in the law. The widow is entitled to it over the claims of the general creditors of the husband. The land mortgaged was, not even after condition broken, the land of Latta, but of McConnell. Latta merely had a lien on it for the payment of his debt. I think, therefore, that the sealed notes of Latta, should be paid out of the personal estate according to their legal priority.
      “To carry out the view which I have taken of the widow's right to dower, it will be necessary to ascertain at a fixed period, what the whole specialty demands against said S. L. McConnell would have amounted to, if no payments had been made thereon by the administrators. In like manner of the mortgage debts, of the personal estate of the deceased, and of the sales of the mortgaged lands. I have made these several estimates as of the date, 5th June, 1856,
      
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      “I have thus ascertained that the whole personal estate of the-intestate, on said 5th June, would amount to forty-four thousand, nine hundred and forty dollars and forty-one cents,* and the amount of specialty demands against it, including- those due to Wm, A. Latta, to sixty-three thousand, and eighty-one dollars and eighty-seven cents. The mortgage debts to the sum of thirty-one thousand and eighty-two dollars and sixty-three cents; and the sales of the mortgaged lands to nineteen thousand, seven hundred and ninety-three dollars. The Latta mortgage debts to be paid out of the personal estate will amount to the sum of twenty-two thousand, one hundred and forty-three dollars and seventy-one cents. This will leave due to Latta, to be paid out of the sales of the mortgaged lands, eight thousand nine hundred and thirty-eight dollars and ninety-three cents. There will then remain of the sales of said land, ten thousand eight hundred and fifty-four dollars and seven cents. To the one-sixth of this sum the widow is entitled ,* and I recommend that the sum of one thousand eight hundred and nine dollars be paid to her. The result to the general creditors, is precisely thesaine, whether this amount be paid to her by the administrators or out of the balance of the sales. Latta has received out of the sales, more than the amount hereby reported payable on his debts, out of that fund added to the dower, and I recommend that the dower be paid to Mary C. McConnell, by the administrators, out of the personal estate. Considerable payments have be'en made to Latta on account of the mortgage debts, and there remained due to him, on the 5th June, 1856, on account of the three notes that have fallen due, the sum of ono thousand nine hundred and fourteen dollars and ninety-eight cents, which sum I Recommend be paid to him by the administrators,
    
    
      
       Ante, p. 252.
    
   The opinion of the Court was delivered by

Johnston, Ch.

The only grounds of appeal insisted on are the first ground of Mr. Smith, in relation to dower, and the four grounds made by Mr. Williams.

It seems to me nothing need be said in support of what is said by the commissioner and the chancellor on the first point.

On tbe other gronnds, the doctrine is -well established in this State, that in a conflict between copartnership creditors and private creditors of one of the copartners, the private creditors have a right to compel the copartnership creditors to exhaust the joint assets before seeking a remedy out of the individual estate of the partners.

It seems equally established in the case of Morton & Courteney vs. Caldwell, the last and leading case on the subject, where the point was elaborately considered, with especial reference to principles, that demands are presentable against the estate of an intestate, in the precise condition in which' they existed at his death, and subsequent payments do not affect this principle. It follows, necessarily, from this position that the demands of the two Charleston houses and, also, the demand of the firm of which McConnell was a member, are provable against his estate for their full amount, as they stood against him when he died. The creditor of a firm is also a creditor of each partner to the full amount of his demand; and would be entitled to take his remedy against the partner but for the opposing equity of his private creditors, who may compel him to resort for his remedy, in the first instance to the partnership assets. But his debt in the meantime is the debt of the individual partner, no less than if there were in fact no partnership assets, and he had not this double resort, and he is entitled to be considered his creditor for such pro rata as his assets would have paid. When it is said he is entitled to come against the private estate of the partner for such balance as may be left after he has exhausted the partnership funds, the meaning is, not that his demand against the private estate is only for that balance, but that his remedy is limited to it.

The partnership is no less entitled to prove against the individual partner’s estate, for any debt he owes the firm than any other of his creditors. It is very clear that the sums which McConnell drew from the Charleston Houses, by using the name of his firm, were partnership assets, chargeable to his private account with the firm: and that the firm were entitled to prove against his estate for these as well as any other debt he owed them.

Ye have, then, in this case, two or more creditors (the Charleston creditors, and McConnell’s own firm,) entitled each to prove the fall amount of their debts against his estate, and to have their pro rata declared. The amount allowed to McConnell & Miller is partnership assets, and passes under the assignment of the surviving partner, according to its terms. The portion to which the Charleston houses are entitled under the assignment, is to be added to what they have already received out of the joint assets, and (to avoid a double payment,) transferred to and deducted from their entire demands, respectively. If by this process there is still left to them a balance equal to or beyond their pro rata portions as creditors of Me Connell’s estate, they are then entitled to receive their whole pro rata. If their balance is reduced below their pro rata, the amount to which the joint assets, thus applied, have reduced it below that pro rata, displaces assets of the private estate, which would otherwise have been applicable to the demands of these parties: which assets fall back into the estate, for the benefit of his other creditors.

It is ordered that the decree be modified according to this opinion, and that the report be recommitted.

DARGAN and Wardlaw, CO., concurred.

Dunkin, Ch., absent at the hearing.

Decree modified. 
      
       3 Strob.^Eq. 161.
     