Page:Federal Reporter, 1st Series, Volume 1.djvu/845

 m EE FRANKLIN M. KBTCHUM. 837 �act of the fii-m and the transfer of the money was not. The two things may be abstractiy considered as separate acts, but they were in reality one act, and the firm cannot take the benefit of the one without being responsible for the other. �The case thus differs from the case of the proceeds of the securities sold and the money afterwards paid in. In that case Belknap individually converted the property into money, and then, having the money in hand, paid it in. Here Bel- knap never had the money, or what purported to be the money, held by him as his own, but he held what purported to show that the money belonged to the firm, or to Morris Ketchum, himself; and the firm, not Belknap individually, converted the money, and appropriated it to their own use. If the checka had been drawn by Morris Ketchum, payable to Belknap's order, and by him indorsed to the firm, there might be some ground for holding that the firm received money from Bel- knap ; but on these facts they received what did not purport to be his money, and cannot, as to this part of the case, invoke in their defence the rule that they are not liable to repay money paid in by a partner, which in fact belongs, without the knowledge of the other partner, to a third party. �Similar considerations apply to the stocks hypothecated to the bank for a loan. The raising of money by loan was a firm transaction, especially committed by the firm to Bel- knap. He pledged certain securities, which may be assumed to be in sueh form that they passed by delivery. He pre- sented them to the bank in this form. Nothing else appears as to any representation of title. The borrowing and the pledge were one act. The firm converted the securities by hypothecating them. One of the partners, as a member of the firm, handed them to the bank as securities of the firm. �The transaction did not purport on its face that the securi- ties were Belknap's, but rather that they were the firm's. If Franklin M. Ketchum had been present and witnessed the transaction there would have been no more reason for him to conclude that they were Belknap's than "that they were the firm's. The ordinary presumption that a man knows his own business, and, therefore, that he knew the firm owned ��� �