This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
A bankrupt may be discharged from his liability to the creditors of a partnership of which he is a member by a discharge given in bankruptcy proceedings affecting himself alone if due notice is given to the creditors of the partnership.1 Hence partnership creditors may participate in individual insolvency and bankruptcy proceedings.2 Under a state statute which requires a creditor who accepts a dividend from an estate assigned for the benefit of creditors to release the debtor from further claims, partnership proceedings will relieve the partners from their partnership and individual debts. Hence the assignment of a partnership which does not include individual property is void.3 If in individual proceedings a discharge is sought which will affect partnership debts such debts must be scheduled,4 notice must be given to partnership creditors5 and the petition in bankruptcy and the petition for discharge should refer to such debts and ask relief therefrom.6 In other jurisdictions it has been held that a discharge of an individual member of a firm does not bar his liability on partnership debts.7 In other jurisdictions it lias been held that a discharge cannot be granted in partnership proceedings to the partners as individuals.8
National Bank v. Mfg. Co., 127 Mass. 563.
15 Elsbree v. Burt, 24 R. I. 322; 53 Atl. 60.
16 Abendroth v. Van Dolsen, 131 U. S. 66; Hill v. Trainer, 49 Wis. 537.
17 Childs v. Childs, 10 O. S. 339; 75 Am. Dec. 512.
1 Tuckers v. Oxley, 5 Cranch (U. S.) 34; Jarecki Mfg. Co. v. McEl-waine, 107 Fed. 249; Hawley v. Campbell, 62 Cal. 442; Clarke v. Stan wood, 166 Mass. 379; 34 L. R. A. 378; 44 N. E. 537; Curtis v. Woodward, 58 Wis. 499;
46 Am. Rep. 647; 17 N. W. 328.
2 Clarke v. Stanwood, 166 Mass. 379; 34 L. R. A. 378; 44 N. E. 537.
3 McCord-Brady Co. v. Mills, 8 Wyom. 258; 46 L. R. A. 737; 56 Pac. 1003.
4 In re Laugblin, 96 Fed. 589; In re Hartman, 96 Fed. 593.
5 In re Russell, 97 Fed. 32; In re Laugblin, 96 Fed. 589; In re Mc-Faun, 96 Fed. 592.
6 In re McFaun, 96 Fed. 592.
7 Glenn v. Arnold, 56 Cal. 631; Perkins v. Fisher, 80 Ky. 11.