Page:Federal Reporter, 1st Series, Volume 1.djvu/823

 IN EE FEANKLIN M. KBTCHUM. 815 �In 'THE Mattee of Franklin M. Ketchum and others, Bankrupts. �{District Court, 8. D. New York. January 10, 1880.) �PAKTMBRSHIP — CONVBRSIOK OF CHATTBL8 BT ACT OF PABTNBB. — If a �flrm acting through an agent or one of the partners, while engaged in the regular course of the business of the firm, innocently or wrongfully appropriates chattels, other than money, or -what has the quality of money, and sella it, and reçoives and uses in its business the proceeds, or, without a sale, uses it in the flnn's business, the flrm is liable for conversion, and it is wholly immaterial that ail or any of the members of the flrm were ignorant of the wrong conunitted, or innocent of any wrongful intent. �gAMB — Conversion of Monky bt Aot of Partner. — The flrm is liabla for the mlsappropriation of money under such circumstances where the innocent partner, on the facts proved, appears to have no equity to avail himself of the payment of the money to the firm» as a payment between himself and his copartner, of money in settlement or adjustment of any balance dne to him on account of the partnership business, or as a pay- ment of money to him upon any consideration whatever, in recel ving ■which he relied upon his copartner's possession as proof of ownership, ■where by reasonable inquiry such innoceat partner could have dis- covered the source from which the misappro'priated money came. �Sahe — Conversion by Firm. — A flrm is liable for conversion, where an individual partner fraudulently drew and deposited checks and hypo- thecated securities for the beneflt of the flrm, without flrst rcceiving the proceeds of such checks and hypothecations. �C. W. Bangs, for Morris Ketchum. �G. W. Betts, for F. M. Ketchum. �0. E, Bright, for opposing oreditors. �Choate, J. This is a proceeding to expunge two proofs of debt made and filed by Morris Ketchum. The bankrupts, Franklin M. Ketchum and Thomas Belknap, Jr., were part- ners, composing the firm of Ketchum & Belknap, and they were adjudicated bankrupts on the petition of Ketchum, one of the partners, filed August 31, 1878. They did business as stock-brokers, in the city of New York, down to the twenty- fourth of July, 1878, when they failed. The proofs of debt now objeoted to were s wom to by Morris Ketchum and filed July 30, 1879, One is for the sum of $8,612.37, alleged to be due "upon an account stated between deponent and said Ketchum & Belknap, of which account a copy is hereto annexed." ��� �