Brief for the Appellee.

187; Adams v. Wood, 8 id. 152; Adams v. Haskell, 9 id. 24; Ross v. Titsworth, 37 N. J. Eq. 333; Holmes v. McDowell, 15 Hun, 585.

Appellants were not estopped from asserting their lien by accepting a pro rata distribution of the funds in the receiver's. hands. Lanahan v. Latrobe, 7 Md. 278.

By their creditor's bill appellants acquired, not a right to a lien, nor a mere right to priority out of the general assets, but an actual, specific lien, which could only be defeated by satisfaction of the judgment or a successful defence of the suit. Weed v. Price, 9 Cow. 7; Edmeston v. Lyde, 1 Paige, 639; Eager v. Price, 2 id. 333; Corning v. White, 2 id. 567; Clarkson v. De Peyster, 3 id. 320; Insurance Co. v. Power, id. 365.

The assets of the firm are legal-not equitable-assets. Adams' Eq. *252, 254; 2 Leading Cases in Eq. pt. 1, p. 384.

Mr. I. K. BOYESON, for the appellee:

The appointment of a receiver placed the co-partnership property in the hands of the law, and no creditor could get a preference by obtaining a judgment subsequent to the appointment of the receiver. High on Receivers, 334, 345, 361; Holmes v. McDowell, 15 Hun, 585; 76 N. Y. 585; Law v. Ford, 2 Paige, 310; Rutter v. Tallis, 5 Sandf. 611; Marr v. Bank, 4 Cold. 471; Van Alstine v. Cook, 25 N. Y. 489.

The appointment of a receiver places the property in custodia legis. Nicoll v. Boyd, 90 N. Y. 519; Temper v. Brooks, 40 Mich. 333; Maynard v. Bond, 67 Mo. 315; Wait on Fraudulent Conveyance, 183, 261.

The title of the receiver relates back to the order appointing him. High on Receivers, 93; Maynard v. Bond, 67 Mo. 315; Rutter v. Tallis, 5 Sandf. 611; Ex parte Evans, L. R. Ch. Div. 260.

Appellants are estopped by proving under the receivership and participating in proceedings before the master. Bigelow

19-114 ILL.

Opinion of the Court.

on Estoppel, 503; 2 Leading Cases in Eq. 139, 141; Am. Leading Cases, (1 Hare & Wall.) 556; Rapallee v. Hewart, 27 N. Y. 312; Rodermund v. Clark, 46 id. 354; Howes v. Henriques, 13 Wend. 243; Irwin v. Tabb, 17 S. & R. 419; Adlum v. Yard, 1 Rawle, 163; Jones v. Norsey, 4 Md. 306; Lanahan v. Latrobe, 7 id. 268.

The assets in the hands of the receiver being equitable assets, which appellants could only reach through a court of equity, they must pay the price of equitable assistance, which always is, that they share pari passu. Silk v. Prine, 2 L. C. in Eq. 358; Purdy v. Doyle, 1 Paige's Ch. 558; Benton v. Le Roy, 4 Johns. Ch. 651; Washburn v. Bank, 19 Vt. 278; Jones v. Lackland, 2 Gratt. 87.

Mr. JUSTICE SCOTT delivered the opinion of the Court:

On the 26th day of April, 1883, Samuel H. Richardson filed a bill in the circuit court, against Truman B. Handy, in which it is alleged the partnership that had previously existed between them was not formed for any specified length of time; that the affairs of the firm had become disordered and embarrassed, and no longer profitable, and that complainant had elected to terminate the partnership; that various parties had instituted suits against complainant and defendant, and that there was danger of the firm assets being wasted by litigation; that the assets of the firm consisted mostly of open accounts and evidences of indebtedness, and office furniture. The prayer of the bill is for the appointment of a receiver to take charge of and collect and preserve the assets, that the cause be referred to a master to take an account between complainant and defendant, and that on final hearing a decree be entered according to the equities existing between complainant and defendant. On the same day, defendant, by stipulation in writing, entered his appearance in the court, waived service of process, and consented to the appointment of a

Opinion of the Court.

receiver, which was done. Afterwards, on the 31st day of May, 1883, on motion, the cause was referred to the master in chancery to take proof of all claims against the firm, and it was by the court ordered that all persons having claims against such firm should present the same before the master for allowance by a day fixed, and that the master give the usual notice to all creditors. Under this order the creditors,—among whom are the petitioners in this case,-came before the master and proved up their claims against the assets of the firm in the hands of the receiver. When the court made its order calling the creditors before the master, the receiver had previously collected, and had then in his hands, the sum of $20,274.31. That sum constituted most Since then a further sum,

of the assets to be distributed.

The

less than $5000, has been collected by the receiver. usual steps were being taken as rapidly as was practicable to close up the partnership affairs and pay the creditors.

On the 5th day of May, 1883, petitioners commenced an action in assumpsit in the circuit court against the firm of Handy, Richardson & Co. Service was had on both defendants, and on the 23d day of the same month judgment was rendered against them by default, for the sum of $9052.12, on which execution was issued on the 25th of the same month, and placed in the hands of the sheriff. On the 29th day of the same month the sheriff made return on the execution, he had made demand on Richardson for property; that he failed or refused to deliver any in satisfaction of the execution; that Handy could not be found so that demand could be made on him, and that he made return of the execution by order of petitioners' attorney, which was as follows: "The sheriff will return the execution in the above case forthwith no property found, no part satisfied.-May 29, 1883." Two days thereafter, that is, on the 31st day of May,-petitioners filed the usual creditors' bill, in which was set forth the recovery of their. judgment against Richardson and Handy,

Opinion of the Court.

the issuing of the execution thereon, and the return of the sheriff no property found and no part satisfied, and concluding with the prayer that defendants may be required to answer, and for a discovery of property to be subjected to the payment of the execution. Service of process was had on Richardson on the same day the bill was filed, but Handy was not found. Richardson answered the bill, and disclaimed having any property subject to execution, and averred that he had turned over all his property to the receiver, and that no debts were due him or the firm other than those already in the hands of the receiver. Afterwards Handy was brought into court by publication, and nothing further seems to have been done in this case, except on the 13th of July an order was entered extending the receivership to this suit, and that assets in the hands of the receiver, or thereafter to be received by him, be held for the benefit of all parties to both suits, to be disposed of under the direction of the court.

Turning back, now, to learn what was done in the original suit, it is seen that on the 5th day of July, 1883, an order was entered granting leave to the present petitioners to file a petition praying that complainant and defendant in the original suit be not allowed to dismiss their suit, or the receiver be discharged. On the 6th day of the same month the time for filing claims before the master was extended to the August term, 1883, and it was ordered that the master mail notice. to all persons appearing on the books of the firm to be creditors, and who had not then come forward and filed their claims. Other parties were allowed to file intervening petitions, and other orders were made, but it is not necessary to an understanding of the case to state them.

It appears from the report of the master, that divers claims were filed before him in June, 1883; that on the 29th day of the same month petitioners filed their claim before him, and for greater certainty referred to the judgments that had been previously obtained by them against the firm, and that in

Opinion of the Court.

the proceedings on proof of claims petitioners had taken an active part, and had contested a large number, but not all, the claims presented. It also appears that at the date of the filing of the original bill in this suit, Handy, Richardson & Co. were in fact insolvent, and that numerous creditors of the firm had commenced, and others were about to commence, suits against them. On the 28th day of January, 1884, petitioners were, by the court, granted leave to file their petition herein, instanter, in the original cause, for priority over other creditors participating in the assets in the hands of the receiver, which they did. In their petition they set forth the recovery of the judgment against the firm of Handy, Richardson & Co., the issuing of the execution on such judgment, and the return of the sheriff no part satisfied; that on the 31st day of May, 1883, they filed their creditors' bill, making both partners defendants; that service of process was duly had on Richardson, and the other defendant having ceased to be a resident of the State, service was had on him by publication; that in July, 1883, they filed with the master, to whom the reference had been made to take proof of claims, their claim, and made proof of the same; that they had received no part of it, and that it had been allowed by the master and approved by the court. It is further stated no decree was entered in the original cause declaring the partnership dissolved, or for an accounting, or for the application of the partnership assets to the partnership debts, until after the bringing of their creditors' bill, and not until after petitioners had asserted a priority to the assets in the receiver's hands, and had obtained an extension of the receivership to their creditors' suit. The prayer is, that petitioners' creditors' bill may be declared to have created a lien on all the assets of the firm, and to have entitled them to priority, to the extent of their judgment, over other creditors. The receiver, by his answer to this petition, admitted the commencement of the original suit April 26, 1883, in which