This case, has heretofore been before the court upon appeal. On the former trial the plaintiff recovered a judgment, which was-affirmed upon appeal by the General Term, and is reported in 2i New York State Reporter, 369. It was subsequently reversed in the Court of Appeals, and a new trial granted. (See 119 N. Y. 623. Reported in full in 28 N. Y. St. Repr. 855.)
The Court of Appeals reversed the judgment in favor of the plaintiff upon the ground that there was no proof that the accounts transferred were the property of the firm of Sheldon & Lawlover. Judge Peckham, who wrote the prevailing opinion in the case, says: “ I have looked in vain in this case for some evidence that the accounts alleged to have been transferred to A. Sherman were the property of Sheldon & Lawlover. This was a necessary fact to be proved, in order to enable the plaintiff to maintain this action. Nor do I find any. evidence of the transfer of any accounts by Sheldon & Lawlover or Lawlover to Sherman.” Then follows a discussion of the testimony permitted to be given by witnesses upon the former trial, which the learned judge held should not have been received.
It appears from an examination of the record here that there is evidence now before us which was not presented upon the former trial. The position in which the casé now is, is this : The defendant in his answer alleges the transfer and delivery to him by Thomas Lawlover, on the second day of June, of certain personal property and book accounts, amounting to the sum of $1,165. We have in *63evidence s written bill of sale signed by both Sheldon and Lawlover, on the 1st day of June, 1882, of certain personal property, consisting of wagons, etc., as before stated, and there is some evidence to show that some of these wagons, at least, had been used in the business carried on under the firm name of Sheldon & Lawlover. Then we have the transfer in writing, signed by Thomas Lawlover, dated June 2, 1882, of a list of accounts, which are characterized by" the statement in writing, at the topi of such list, “ Sundry parties, debtor to Sheldon and Lawlover.” It seems to me to be conclusively established by the parol evidence, and by this documentary evidence, that the personal property and book accounts set forth-in the defendant’s answer, as having been transferred to his testator on June second by Lawlover in payment of money loaned by him to said Lawlover, are the same property and the same book accounts as are mentioned in the written instrument.! have referred to. In fact, there is very little pretense but that such accounts were accounts contracted in the course- of the business carried on by Sheldon & Lawlover, and the wagons, harness, sleighs, etc., were property used by them in such business. The title to the personal property, other than the book accounts, is derived directly from the instrument signed by the.members of such firm.
The contention, however, upon the part of the defendant is, that Sheldon had no interest in this property ; that it was in fact Law-lover’s individual property, and that, therefore, it could be used 'to-pay his individual debts. I do not think this contention can be sustained. The transfer by Sheldon to Lawlover of all his right,, title and interest in the firm property was not valid as against pier-sons dealing with the firm without notice of such transfer. No notice was given of it, or the fact published, but the business continued to be conducted at the same place, and under the same name.'
It would appear from the summary statement in the record before us, of the judgment roll in favor of the- plaintiff,"that the plaintiff himself sold goods to, them jointly, and also received a note executed.-by them, and obtained judgment against them thereon. In addition to that, they make an assignment of their effects, signed by each of them, for the benefit of creditors. I know of no provision of the statute in relation to assignments which allows two or more persons to join in an assignment, unless they have joint interests to *64assign, and persons to whom they are jointly indebted, to protect or distribute their assets among.
The instrument of assignment of Sheldon to Lawlover itself shows that there was no intention to dissolve the firm, but that it was made to protect and secure Lawlover for the advancements he had made for the purpose of carrying on the business, and that the assignment was only to last until the contributions by Sheldon to the business should equal those of Lawlover. As between themselves, possibly, it may be that Lawlover was for the "time being, at least, the owner, of all the copartnership property; but as to third persons dealing with them as copartners, and having no knowledge of t-he agreement between them, it was of no effect. (Kelly v. Scott, 49 N. Y. 595.)
. The property, then, belonging to and used in the business of this firm, should first have been appropriated to pay the firm’s debts, and the transfer thereof to Augustus Sherman to pay Lawlóver’s individual debts was void as against the firm’s creditors,"and the plaintiff was, therefore, entitled to recover such property, or the value thereof, "from the defendant, as executor of the estate of Augustus Sherman, and the judgment should, therefore, be reversed and a new trial granted.
The Court of Appeals, in discussing the testimony upon the former trial, criticised the testimony of one of the witnesses in particular, holding that certain questions put to him that were objected to should have been ruled out.
I notice upon this second trial, in the examination of the witness Morgan, that the same questions were repeated and the evidence received. Undoubtedly the referee was not aware of the ruling of the Court of Appeals, but the attorneys should have called his attention to such ruling and not permitted him to be misled. It seems to me proper to call attention to this matter lest the same errors be committed upon the next trial.
The judgment appealed from should be reversed, the referee discharged and a new trial granted, with costs to abide the event.
All concurred.
Judgment reversed,, referee discharged and a new trial granted, costs to abide the event. ■ .