U.S. Supreme Court
Nelson v. Hill, 46 U.S. 5 How. 127 127 (1847)
Nelson v. Hill
46 U.S. (5 How.) 127
It is not irregular for two mercantile firms to unite as complainants in equity in a creditor's bill.
An objection that a bill is multifarious must be made before answer, and can be tested only by the structure of the bill itself.
The creditor of a partnership may, at his option, proceed at law against the surviving partner or go in the first instance into equity against the representatives of the deceased partner. It is not necessary for him to exhaust his remedy at law against the surviving partner before proceeding in equity against the estate of the deceased.
Where there were two mercantile firms and some of the members common to both, a creditor's bill was not multifarious when filed against the personal representatives of two of the deceased partners of the two firms and also against the surviving partner of one of the firms.
The suit originated in the District Court of the United States for the Middle District of Alabama, from which it was carried by appeal to the circuit court and thence was brought to this Court.
In 1834, the appellants, consisting of two mercantile houses in New York, became the creditors of two firms in the State of Alabama, namely the firms of Whitsett, Gray & Co. and of Whitsett & Gray, the former composed of William H. Whitsett, Thomas Gray John J. Hill the latter of William H. Whitsett and Thomas Gray.
The debts of these Alabama houses to their New York creditors set forth as follows:
Whitsett, Gray & Co. to Nelson, Carleton & Co., a note dated May 17, 1834, for $1,061.36, at 9 months; Whitsett, Gray & Co. to Parish, Marshall & Co., two notes, one dated May 10, 1834, for $1,470.95, at 9 months, and one, same date, for $1,470.95, at 11 months; a bill of exchange drawn by Whitsett, Gray & Co. on John C. Sims & Co. for $1,901.56, at 4 months; and a note to White, Brothers & Co., by Whitsett, Gray & Co., for $331.46, at 12 months.
Of the individuals composing the two Alabama firms, William H. Whitsett died in October, 1835, and administration of his estate was committed to Lipscomb & Hardin. Thomas Gray died in 1835, and administration of his estate was granted to James Gray and Ann R. Gray the widow of Thomas, who afterwards intermarried with Lorenzo Sexton. chanroblesvirtualawlibrary
Upon three of the above notes judgments were obtained in December, 1835, against Hill as surviving partner of Whitsett, Gray & Co. In January, 1840, a bill was filed on the equity side of the District Court of the United States for the Middle District of Alabama by the New York firms, which, in August, 1841, was amended. The amended bill included, as defendants, James Gray Lorenzo Sexton and Ann R. Sexton (formerly Ann Gray), administrators of Thomas Gray deceased, Absalom Hardin, John P. Lipscomb, and Joseph J. Hill administrators of William H. Whitsett, deceased.
The bills recited the above fact, stated that execution had been sued out against Hill but that no property could be found, that the estate of Whitsett had been reported to the County court as insolvent, but that the estate of Gray was fully able to pay the debts of the partnerships, praying for a discovery and payment &c.
Lipscomb and Hardin answered the bills, denying generally the merits of the claim.
Hill answered separately, and concluded his answer with denying the right of the complainants to unite their claims in one suit.
Gray filed a separate demurrer, assigning therefor the following causes:
"I. That the said complainants have not by their said bill and amended bill made such a case as entitles them in a court of equity to any discovery from this defendant or any relief against him as to matter contained in the said bill and amended bill &c."
"II. That the complainants have joined in their bill and amended bill distinct matters which, according to law and the practice of this Court, ought not to be joined &c. -- that is to say, have joined matters against the late firm of Whitsett & Gray composed of Wm. H. Whitsett, deceased, and Thomas Gray deceased, with matters against the late firm of Whitsett, Gray & Co., composed of the said Whitsett & Gray and one John J. Hill the said John J. Hill having no interest in the matter against the said late firm of Whitsett & Gray. They have joined matters of debt against said late firm, Whitsett & Gray created by note, payable to certain persons using the name and style of White, Brothers & Co., to which debt the said complainants, or either of them, have not any interest, as far as appears by their said bill or amended bill, and in which the said defendant Hill is in no wise interested, nor in any wise liable &c."
"III. The complainants' bill and amended bill do not show that complainants had exhausted their remedy at law before coming into this court in such manner as to entitle them to the aid of this Honorable Court as a court of chancery &c. Wherefore, for the foregoing causes, and for divers other causes of demurrer appearing in the said bill and amended bill, this defendant doth demur thereto, and he prays the judgment of this Honorable Court whether he shall
be compelled to make further and other answers to the said bill, and he humbly prays to be dismissed from hence with his reasonable cost in this behalf sustained."
In December, 1841, the cause came before the district court, which sustained the demurrer.
The complainants appealed to the circuit court, which in March, 1843, affirmed the decree of the district court. From the decision of the circuit court the complainants appealed to this Court. chanroblesvirtualawlibrary