of exchange not matured, on a proper discount being made.

The above order, as it will be seen, gives the dividend equally to all creditors. Chancellor Walworth, in Law v. Ford, 2 Paige's C. R. 310, and which was a case of partnership, says: "In such a the court would direct the receiver to apply "the partnership property and funds to the pay"ment of all the debts of the firm, ratably, without giving a preference to the favorite creditors of "either partner."

case,

Creditors, in partnership, are entitled to receive dividends for their whole debts, notwithstanding any securities they may have from third persons who stand in the situation of mere sureties for the partnership: Wilder v. Keeler, 3 Paige's C. R. 167.

In paying a dividend, the receiver had better take a receipt from the creditor on the back or at the foot of a certified copy of the order which authorized the dividend. If the number of the creditors be large, then he had best have the receipts taken in a book, which book might have a certified copy of the order for the dividend placed as a first sheet.

The form of order which we have above given (page 567) for a dividend, is so drawn as to dispense with a reference to a referee or master. Such a reference, however, may be advisable where the concern is extensive or the claims are complicated or doubtful. This was done in the cause of Phillips v. Stewart and others, before the vice-chancellor of the first circuit (September, 1839). The case re

lated to a limited partnership. The receiver, in his petition to make a dividend, suggested that many claims against the estate had changed hands since the appointment of the receiver, the same having been purchased by present holders at from twentyfive to fifty cents on the dollar, and he wished the suggestion of the court whether the dividend, in such cases, would have to be paid on the original amount of the debt or on the amount actually paid by the holders? The vice-chancellor, who, it is believed, settled the order, has not inserted any thing which would leave one to say that the creditors are not all to share equally. We give below the form of order that was entered and the master's advertisement thereon. (a)

(a)

Present,

At a court of chancery held for the State of New York at the city of New York, on the tenth day of September, one thousand eight hundred and thirty-nine.

William T. McCoun, Vice-Chancellor of the First Circuit.

William Phillips

28.

Seneca Stewart and others.

On reading and filing the petition of Meigs D. Benjamin, receiver in this cause, and affidavits of verity and notice of this motion to the solicitors of the respective parties in this cause and affidavit of the due service thereof, and on motion of Henry E. Davies, of counsel for said receiver: It is ordered, that it be referred to Stephen Cambreleng,

Esquire, one of the masters of this court, residing in the city of New York, to call before him the creditors of the limited partnership of the said Seneca Stewart mentioned in the pleadings in this cause; and that the said master ascertain the amount due to said creditors respectively; that the said master give three weeks previous notice of the time and place of proceeding to ascertain the amount of said debts and for the said creditors to exhibit their demands, by publishing the same once in each week for at least three weeks, in four of the daily newspapers in the city of New York and in the State paper. And it is further ordered that the said master be at liberty to examine any of said creditors on oath, if required by said receiver, and to examine any witnesses produced to sustain or oppose the claim or demand of any creditors. And it is further ordered, that, on the coming in and confirmation of said master's report, the clerk of this court do pay over and transfer to said receiver the funds now on deposit in this cause to the credit of the clerk of this court in the New York Life Insurance and Trust Company, with the interest which has accrued thereon; and that said receiver immediately pay over to the said creditors a dividend of twenty-five cents on the dollar of the amount ascertained by the said master to be due to said creditors respectively, or a larger sum if the funds in hand will safely pay the same; and if the funds on hand shall not be equal to a dividend of twenty-five per cent., then that said receiver declare and pay such dividend on said debts as shall be ascertained by said master the funds in his hands will safely pay. It is further ordered, that in case any of said creditors shall be dissatisfied with the decision of said master on their claims and shall except to his report, then the said receiver shall reserve a sufficient sum to pay the dividend directed on the amount claimed by such creditors and proceed to pay the other creditors who shall be satisfied with the decision of said master on their claim and shall not except to his report.

And it is further ordered, that the said master ascertain and inquire what compensation the said receiver is entitled to for his services in managing, closing up and transacting the business of his trust up to and including the declaring and paying said dividend; and that said receiver be authorized to retain in his hands out of the funds he may have received in this cause such sum as the said master shall so ascertain and determine he is entitled to. And it is further ordered that the said receiver pay to the solicitor for the complainant in this cause, out of the funds in his hands as such receiver, the sum of five hundred dollars on account of the costs and counsel fees of the said complainant in this cause.

ADVERTISEMENT thereon:

Before the Vice-Chancellor,

In Chancery.

William Phillips

V8.

Seneca Stewart and others.

NOTICE. Pursuant to an order of the court of chancery, made in the above entitled cause and dated the 10th day of September, 1839, notice is hereby given to all the creditors of the limited partnership of the abovenamed Seneca Stewart, mentioned in the pleadings in the above entitled cause; and they are hereby. required to present and exhibit their respective claims to the undersigned, one of the masters of this court, at his office, No. 20 Nassau Street, in the city of New York, on the 7th day of October next, at 1 P. M., together with the evidences of their respective demands, in order that the amounts respectively due to said creditors may be then and there ascertained. New York, September 11, 1839.

STEPHEN CAMBRELENG,

Master in Chancery.

CHAPTER XIV.

PERSONAL AND PECUNIARY LIABILITY OF A RECEIVER. PRIVILEGES AND LIABILITIES OF THE SURETIES OF A RECEIVER.

Personal and Pecuniary liability of a receiver.

A RECEIVER should keep the exclusive control of his funds. If he do not, and loss ensue, he will be liable.

The case of Knight v. Lord Plymouth, 3 Atk. 480; S. C. 1 Dick. 120, would seem to trench upon this principle, provided it were to be depended upon; but we shall hereafter see that it is not. However,

it

may be right to give an outline of the case and an extract from the decision of the court. The receiver had received a large sum in specie, which he wanted to get to London, where he was to account and pay his balances. He did not think it fit to remit the money; but took a bill of exchange from a person who was a considerable tradesman. This person became bankrupt; and the receiver petitioned that the amount might be made good out of the estate. Lord Hardwicke referred it to a master to inquire into the fact and to state it with all circumstances;