Case, 1 Lawrence, Compt. Dec., 2d ed., 263, 285; Klink's Case, Id. 247,

250.

If the claimants could now assert a right against Francis Baring & Company in a court of equity, they would be met with the objection of stale claim. Thus it is said:

"A defence, peculiar to courts of equity, is founded upon the mere lapse of time, and the staleness of the claim, in cases where no statute of limitations directly governs the case." (2 Story, Eq. Jur., 12th ed., § 1520, citing English authorities; Smith v. Clay, Ambler, 645; Bond r. Hopkins, 1 Sch. & Lefr., 428; Hovenden v. Lord Annesley, 2 Id., 630; Stackhouse r. Barnston, 10 Ves., 467; Ex parte Dewdney, 15 Id., 496; Beckford and others v. Wade, 17 Id., 96; Cholmondeley v. Clinton, 2 Jac. & Walk., 138; Portlock v. Gardner, 1 Hare, 594; Vigers v. Pike, 8 Cl. & Fin., 650.)

"Courts of equity refuse to interfere after a considerable lapse of time, from considerations of public policy, from the difficulty of doing entire justice, when the original transactions have become obscure by time, and the evidence may be lost, and from the consciousness that the repose of titles and the security of property are mainly promoted by a full enforcement of the maxim, vigilantibus, non dormientibus, jura subveniunt." (1 Story, Eq. Jur., § 529; 1 Fonbl., Eq., B. 1, ch. 4, Sec. 27; Jeremy, Eq. Jurisdiction, B. 3, Pt. 2, ch. 5, p. 519; 1 Madd., Pr., ch. 79.)

The case of Combs v. Hodge et al. (21 How., 397) will illustrate the danger of treating a blank indorsement as prima facie evidence of a right, especially after such lapse of time as would lose the evidence to rebut the claim of such a right.

The claimants in this case are not entitled to payment, because there is no such evidence as is required to support any equitable right in them. If it be said, such right should be presumed from their undisputed possession during such a lapse of time, it is a sufficient answer to say, that there is no evidence to show how long the claimants have been in possession of the papers, and that, if there was, the lapse of time would raise a presumption of payment.

There is no evidence that Charles Wall, who seems to have executed the blank assignment and power on behalf of Francis Baring & Company, was a partner in that firm, unless the ex parte statement of the notary, before whom his acknowledgment purports to have been taken, is to be so regarded. The assignment itself does not show any such fact. And if so, there is no evidence of a sealed authority, by which one partner could make such assignment so as to give a right at law. The claimants are not entitled to payment.

TREASURY DEPARTMENT,

First Comptroller's Office, January 13, 1883.

IN THE MATTER OF THE ALLOWANCE OF A CLAIM AGAINST THE UNITED STATES IN FAVOR OF A FIRM, ONE MEMBER OF WHICH IS A DULY ADJUDICATED BANKRUPT.-WINCHESTER'S CASE.

1. The bankrupt act of March 2, 1867 (14 Stat., 517), adopts the common-law rule, that, in the distribution by legal proceedings of the assets of a partnership, its creditors are generally entitled to priority over the creditors of the individual members of the firm, and that, in the distribution of the separate estates of the individual partners, their respective creditors are entitled to priority.

2. The general rule at common law is, that, when one partner dies, the survivor, or survivors, settle up the partnership business, and account to the legal representatives of the deceased partner for the proper share of the surplus assets, if any, after discharging liabilities.

3. By the common law, if a creditor of one partner levy an attachment or execution on the interest of such partner in the firm assets, the partners retain possession thereof, settle the partnership business, and account to such creditor after satisfying partnership creditors.

4. The common law remains in force until altered by some written law. And statutes are not to be construed as altering or repealing the common law further than their language and purpose reasonably require.

5. In case of the bankruptcy of one member of a partnership, the firm, or the remaining solvent members, are entitled to collect all claims of the partnership, pay its liabilities, and account to the assignee of the bankrupt, if required by him to do so, for the proper share of the surplus, if any.

December 27, 1882, the Commissioner of Internal Revenue addressed a letter to the First Comptroller, saying:

"This office has under consideration a claim presented by C. and G. C. Winchester, copartners, for an allowance of drawback of internalrevenue tax on articles exported under the provisions of section 171 of the act of June 30, 1864 [13 Stat., 302; Rev. Stat. 3441], and *

it now appears that one of the partners, George C. Winchester, became bankrupt subsequent to such exportation. As a question has arisen whether the allowance * * * should be made to the firm of C. and G. C. Winchester, or jointly to C. Winchester and the assignee of G. C. Winchester, *, this question is respectfully submitted for your

opinion thereon."

It is not expressly stated, but may be assumed, that only one member of the firm is in bankruptcy.

OPINION BY WILLIAM LAWRENCE, First Comptroller.

The question presented involves a construction of certain provisions of the bankrupt act of March 2, 1867 (14 Stat., 517, sec. 19, Rev. Stat., 5067-5072; sec. 27, Rev. Stat., 5091, 5092; sec. 28, Rev. Stat., 5101; sec. 32, Rev. Stat., 5114, 5115; sec. 33, Rev. Stat., 5117, 5118; sec. 34, Rev. Stat., 5119, 5120; sec. 36, Rev. Stat., 5121). The bankrupt act recognizes and adopts the common-law rule, that, in the distribution by legal proceedings of the assets of a partnership, its creditors are gen

erally entitled to priority of payment over the creditors of the individual members of the firm, and that, in the distribution of the separate estates of the individual partners, their respective creditors are entitled to priority. (1 Parsons, Contracts, 6th Am. ed., 204 [224]; Murrill et al. v. Neill et al., 8 How., 414.) Thus, it provides, that "the net proceeds of the joint stock shall be appropriated to pay the creditors of the copartner. ship, and the net proceeds of the separate estate of each partner shall be appropriated to pay his separate creditors." (Rev. Stat., 5121.)

The general rule at common law is, that, when one partner dies, the survivor, or survivors, settle up the partnership business, and account to the legal representatives of the deceased partner for the proper share of the surplus of assets, if any, after discharging liabilities. (1 Williams, Exrs., 6th Am. ed., 722 [653], note; 3 Id., 1842 [1740], note; Bump, Law and Practice of Bankruptcy, 499; In re Stevens, 5 Bankrupt Reg. ister, 112; s. C., 1 Pacific Law Reporter, 45).

If a creditor of one partner levy an attachment or execution on the interest of such partner in the firm assets, the partners retain possession thereof, settle the partnership business, and account to such creditor after satisfying partnership creditors. (1 Parsons, Contracts, 6th Am. ed., ch. xii, sec. xv, 204 [224], 207 [227], 3 Id., 468, 484.) The bankrupt act recognizes these principles. It does not repeal them. They therefore remain in force, as all common-law principles do, until repealed. Statutes are not to be construed as altering the common law further than their language and purpose reasonably require. (Sedg wick, Construction Stat. and Const. L., 2d ed., 267, note; Bacon, Abr., Stat., G.; Potter's Dwarris, Stats., 74.) It follows from these principles, that, in case of the bankruptcy of one member of a partnership, the legal title to the partnership property remains in the firm, with a right in the firm, or the remaining solvent partners, to settle up the partnership business, and account for the proper share of surplus, if any, to the assignee of the bankrupt. Thus, it is said:

"It is a universal rule, that the assignee represents the insolvent, so far as to be subject to all the equities against him which attach to any effects in the assignee's hands." (3 Parsons, Contracts, 468 [419]; Ex parte Newhall, 2 Story, 360; Ex parte Hanson, 12 Ves., 346.)

And again it is said:

"If a member of a partnership became insolvent, his interest in the property of the firm would pass to his assignee, subject to the rights of other partners, much as it would by attachment or levy." (3 Parsons, Contracts, 483 [435].)

The bankruptcy of one partner does not affect the rights of creditors of the firm, including their right of priority in payment. The rights of creditors are worked out through the partners. (Sigler and Richey v. Knox County Bank, 8 Ohio St., 511).

The result stated is supported by opinions in bankrupt cases. Thus, where one member of a firm applied for a certificate of discharge, the

remaining members being bankrupts, the court approved the report of the register, declaring it necessary to bring into court "all of his copartners," and saying:

*

*

"In no other way could the court get jurisdiction of the partnership If property so as to administer upon it. the other partners are solvent and have committed no act of bankruptcy, it is clear that they cannot be brought in, for they cannot be adjudged bankrupts. The assignee in that case becomes a tenant in common of the solvent partners, and after the partnership creditors are paid from the partnership property or their claims are otherwise disposed of, the assignee of the bankrupt partner may have an accounting with the other members of the copartnership, and obtain from them and bring into the bankruptcy court for distribution among the individual creditors, whatever interest the bankrupt may have remaining in the copartnership property."

And further saying:

"The proceedings

[were not] of any avail to convey the interest of the members of the firm * to any assignee in bankruptcy." (In the matter of Greenfield, 42 Howard, Pr., 469 et seq.; In re Beal, 2 Bankrupt Register, 178; s. c., 2 Law Times Bankrupt Reports, 95.)

"The provisions of the [bankrupt] act in regard to the marshaling of assets only apply in a case where the partnership is brought into bankruptcy, and does not apply to a case where only one of the partners is in bankruptcy." (Bump, Law and Practice of Bankruptcy, 198; In re Melick, 4 Bankrupt Register, 26; In the matter of William Downing, bankrupt, 1 Dillon, 39.)

When only one member of a firm becomes bankrupt, his assignee has no right to the custody of the partnership effects. Thus, it is said of the assignees of one bankrupt member of a firm:

"They do not become partners in his stead, because the dilectus personarum, and other principles of the law of partnership, prevent this. But they become tenants in common, with the partners, and have the rights and obligations of tenants in common, with some qualifications, and, perhaps, some additions, which arise from the peculiar origin of the tenancy. Thus, the assignees may claim an account, and require a prompt and complete settlement of the concern. They cannot take the property and business into their own hands, and, settle it themselves, because the solvent partners, at least in equity, hold, in somewhat the same way that surviving partners do, all the effects and property, and for the same purpose, that of winding up the concern,"

(Parsons, Partnership, 2d ed.; [472], 488; Hilliard, Bankruptcy and Insolvency, 60, Murray v. Murray, 5 Johns., ch., 78; Wilson v. Greenwood, 1 Swanst., 482; Marquand v. N. Y. Man. Co., 17 Johns., 525; Richardson v. Tobey & another, 3 Allen, 81; Crawshay v. Collins, 15 Ves., 218; Hubbard v. Guild, 1 Duer, 662; Freeland v. Stansfield, 13 Eng. L. & Eq., 336; Brown v. De Tastet, Jac., 284.)

The assignee of the bankrupt partner should not be named in the allowance of the claim.

TREASURY DEPARTMENT,

First Comptroller's Office, January 16, 1883.

IN THE MATTER OF THE RIGHT OF A SUBCONTRACTOR FOR CARRYING MAILS TO RECEIVE PAYMENT THEREFOR FROM THE UNITED STATES.ANDREWS'S APPEAL CASE.

1. The rights of subcontractors for carrying mails are subject to, and controlled by. the statutes regulating the mail service, as fully as if these statutes were incorporated in their subcontracts.

2. The laws in force at the date when a contract becomes operative are generally applicable in giving it construction and effect.

3. The act of May 4, 1882 (22 Stat., 53), does not in terms, or by any reasonable implication, or in its purpose, affect the rights of subcontractors for carrying mails, as prescribed by the act of May 17, 1878 (20 Stat., 62).

4. Section 626 of "The Postal Laws and Regulations" issued July 1, 1879, by authority of the Postmaster-General, was a valid regulation.

5. This section of the regulations was superseded by the circular regulation on the same subject of October 15, 1880.

6. A regulation which revises the whole subject of a former one, and has the same objects, supersedes the former, without any express words of repeal.

7. The sole authority to prescribe regulations "for the Government of" the Post-Office Department, "the conduct of its officers and clerks, the distribution and performance of its business, and the custody, use, and preservation of the records, papers, and property appertaining to it," is in the Posmaster-General.

8. He cannot delegate such authority to any other officer or person.

9. The act of May 17, 1878 (20 Stat., 62), does not prescribe any time when, or within which, subcontracts for carrying mails shall be filed in the office of the Second Assistant Postmaster-General. The effect of the statute and the regulation of the Post-Office Department on the subject is, that a subcontractor is entitled to the authorized payment for the service of any quarter, when his contract is filed, and notice given to the proper Auditor, before a balance is certified therefor in favor of the original contractor.

10. Whether a subcontractor is entitled to payment, when his contract is filed, and notice given to the proper Auditor, after a balance is certified therefor in favor of the original contractor, but before warrant issues, or actual payment-quære. 11. The act of May 17, 1878 (20 Stat., 62), in effect requires subcontracts for carrying mails to be in writing. This requirement is mandatory, not directory. Hence, a subcontract cannot provide for compensation to a subcontractor before its execution, nor can it be made so to operate by being antedated.

12. Performance by a subcontractor of the conditions of his subcontract is essential to give him a right to compensation.

13. A subcontract for carrying mails, which in terms gives to the subcontractor the whole original contract price, is fraudulent and void as against the United States, if there be an agreement that the subcontractor shall pay a portion of such price to the original contractor, and if such original contractor be otherwise indebted to the United States.

Albert E. Boone entered into a contract with the United States, by which he agreed to transport the mail in the "star route" service on route No. 30107, from Pearl River, Louisiana, to Halloo and back, once a week, by a schedule satisfactory to the Post-Office Department, at $89 per year, for and during the term beginning July 1, 1882, and ending June 30, 1886, said sum to be paid by the United States quarterly in