f. Negotiable instruments by public agents. As a general rule, when public agents, in good faith, contract with parties having full knowledge of the extent of their authority, or who have equal means of knowledge with themselves, they do not become individually liable unless the intent to incur a personal responsibility is clearly expressed, although it should be found that through ignorance of the law they may have exceeded their authority." This

such cashier was not necessary to give title to the bank.

can make any difference in this respect whether the party signing deIn the case of Bank of Genesee v. scribes himself as agent simply, or Patchin Bank, 19 N. Y. 312, S. B. adds the name of his principal; in Stokes, the cashier of the Patchin either case the principle upon which Bank, sent to the Bank of Genesee to his liability is established and parol be discounted, a bill of exchange pay- testimony excluded must be the same; able to the order of "S. B. Stokes, the instrument upon its face is his Cas.," indorsed by him with the same own, and not the promise of his prinaddition to his signature and inclosed cipal. To this rule usage has estabin a letter dated at the banking-house lished an apparent exception, in the and signed "S: B. Stokes, Cas." It instances where a bill is drawn or was held that these circumstances imported that the indorsement was that of the Patchin Bank in the regular course of business, and not that of S. B. Stokes, individually. In Bank of New York v. Bank of Ohio, 29 N. Y. 619, it was held that a draft drawn payable to "D. C. Converse, Esq., cashier," who was cashier of the defendant, was in judgment of law payable to the bank of which he was the cashier.

In Watervliet Bank v. White, 1 Den. (N. Y.) 608, the indorsement was in these words: "Pay to E. O., Cashier, or order;" it was held a transfer to the bank of which E. O. was the cashier. See also Robb v. Bank, 41 Barb. (N. Y.) 586; Mechanics' Bank v. White Lead Co., 35 N. Y. 505; Farrar v. Gilman, 19 Me. 440; Burnham v. Webster, 19 Me. 232; Nichols v. Frothingham, 45 Me. 220, 71 Am. Dec. 539; Russell v. Folsom, 72 Me. 436; Bank v. Wheeler, 21 Ind. 90; Nave v. Lebanon Bank, 87 Ind. 204; Vater v. Lewis, 36 Ind. 288, 10 Am. Rep. 29; Houghton v. First Nat. Bank of Elkhorn, 26 Wis. 663, 7 Am. Rep. 107; Kennedy v. Knight, 21 Wis. 345, 94 Am. Dec. 543; Stamford Bank v. Ferris, 17 Conn. 268; Collins v. Johnson, 16 Ga. 458.

accepted by the cashier of a bank. But it is rather apparent than real, since the custom by which a cashier represents his bank in such matters, by simply signing his own name, is so general that the practice has reduced the custom to the certainty of law, as it is everywhere understood that in such cases, whether he describes himself as cashier or not, he is an alter ego of the bank. His signature is a recognized mode in which a bank may become a party to commercial paper; and the obligation so created is that of the bank and not of the cashier."

52. Presumption as to authority of public agent. In the case of Sanborn v. Neal, 4 Minn. 126, 77 Am. Dec. 502, a note was executed on behalf of a school district in form following: "One year from date, we, as trustees of school district No. 10, in Rice Co. promise to pay," etc., and signed by the three trustees with their individual names with no appendage to show their representative capacity. The trustees were held not to be personally responsible. In the course of its opinion the court uses the following language: 'In this as in all other cases, the intention of the parties governs, and when a person, known to be a Exception to general rule in favor public officer, contracts with reference of bank cashiers. In the case of Rob- to the public matters committed to inson v. Kanawha Valley Bank, 44 his charge, he is presumed to act in Ohio St. 441, 58 Am. Rep. 829, the his official capacity only, although court said: "We fail to see how it the contract may not in terms allude

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same rule should in reason be adopted in case of the making, drawing, accepting, and indorsing of negotiable instruments by public agents. The cases upon this question are not all in favor of the application of this rule to such instruments, although the weight of authority would seem to be upon that side.54 Justice Story has said: "The same principle applies to cases, where public officers, contracting for a public purpose, afterward, upon a settlement of accounts with the other contracting party, strike a balance, and in writing promise to pay that balance on a specific day, signing their names with their official designations annexed, as for example, as commissioners; for such a written document is quite to the character in which he acts, un- In Wing v. Glick, 56 Iowa, 473, it less the officer by unmistakable lan- was held that a contract containing the guage, assumes a personal liability, or words "We promise to pay," and is guilty of fraud or misrepresenta- signed by two persons describing themtion. Being a public agent with his selves respectively as "President powers and duties prescribed by law, School Board" and "Secretary School the extent of his powers are presumed Board," but which contained no referto be as well known to all with whom ence to any school district, was held he contracts as to himself." to be the personal obligation of the signers, who could not show by parol evidence that such was not in fact the intention. See also Fowler v. Atkinson, 6 Minn. 579; Bayliss v. Peterson, 15 Iowa, 279.

Parsons, in his work on Notes and Bills (p. 122), says: "As a general rule, one who acts professedly as a public agent, and had authority so to act, is not liable, although the public fail to perform the contract, unless circumstances indicate that it was understood between him and the party dealing with him that the contract was made on his personal credit. As, for example, that an officer charged with the erection of some public building induced laborers to engage in it by his personal promise that their wages should be paid at all events, and whether funds were provided or not. So if he drew bills or gave notes for the public, but with the same personal assurance, or guar anty, or if such assurance could be implied from the nature of the case." 53. Authority to bind not presumed. -In the case of Cahokia v. Rautenberg, 88 Ill. 219, a note in the form: "Ninety days after date I promise to pay to the order," etc., and signed by the persons as "school trustees," was held to be the personal obligation of the signers. It appeared in this case that while the money borrowed on the note was used for the benefit of the school district, the term of office of the trustees had expired and they had no authority to bind the district.

54. Monticello v. Kendall, 72 Ind. 91, 37 Am. Rep. 139; Moral School Township v. Harrison, 74 Ind. 93; Sheffield School Township v. Andress,

56 Ind. 157.

Where public agents sign a note adding their character of agents, they are not personally liable, unless, at the in their hands. They are not liable on time of the suit, they have public funds ments on contracts entered into subsethe ground that they have made payquent to the note on which they are sued, and thus exhausted their funds. Fox v. Drake, 8 Cow. (N. Y.) 191.

In Iowa it has been held, contrary to the case cited in the preceding note, that a note reading, "We, the undersigned directors of school district No.

etc., signed with their individual names merely, creates no individual liability against its signers, but holds them only in their official capacity. Baker V. Chambles, 4 G. Greene (Iowa), 428.

A foreign consul who draws a bill on account of his government in his official capacity is not personally liable thereon. Jones v. Le Tombe, 3 U. S. (3 Dall.) 384, 1 L. Ed. 647.

consistent with an intention not to incur any personal responsibility; but merely to apply the public funds, which might be in their hands at the time prescribed, toward the discharge of the public debt." 55

30. Partners.

a. In general; what constitutes a partnership.- Many of the rules applicable to agents as makers, drawers, acceptors, and indorsers of negotiable paper are also applicable to partners.

A partnership exists where two or more persons enter into a joint undertaking, with an agreement to share in the profits and losses of the business;56 as where two persons make a joint purchase for a particular adventure, upon an agreement to share jointly in the ultimate profit and loss;57 or where persons become joint proprietors of property and funds, and engage in a business upon a contract to share the profits and losses.58 A community of interest in land does not make mere partners, nor does a community of interest in personal property. There must be some joint adventure, and an agreement to share in the profit and loss of the undertaking.59 As between the parties themselves, in order

55. Story on Agency, § 304.

56. Definitions.- In the English Partnership Act, 1890, a partnership is defined as "the relation which subsists between persons carrying on a business in common with a view of profit.

Partnership is a legal entity formed by the association of two or more persons for the purpose of carrying on business together and dividing its profits between them. Parsons on Partnership, § 1; 3 Kent's Comin. 23; New York (Proposed) Civil Code.

Partnership is the relation which subsists between persons who have agreed to combine their property, labour or skill in some business, and to share the profits thereof between them. Indian Contract Act, § 239.

57. Reynolds v. Cleveland, 4 Cow. (N. Y.) 288; Champion v. Bostwick, 18 Wend. (N. Y.) 175.

58. Cumpston v. M'Nair, 1 Wend. (N. Y.) 457; Chase v. Barrett, 4 Paige (N. Y.), 148.

59. Porter v. McClure, 15 Wend. (N. Y.) 187.

A contract by the terms of which the owner transfers to another the

exclusive use and control of property, and is to receive as rent therefor a portion of the profits arising from such use is not a partnership contract. Garrett v. Republican Pub. Co., 61 Neb. 541, 85 N. W. 537.

Community of interests in profits, not by way of compensation for services rendered or capital loaned, but profits as such, and community of interests in the property the subject of the venture, and community of power of management of such property, are correct tests of copartnership. Waggoner v. Bank, 43 Neb. 84, 61 N. W. 933.

Where several persons joined in a written agreement, each to pay a certain definite sum of money to defray the expenses of sinking a gas well, and, in the event that gas was found in paying quantities, to share in the proceeds thereof, if any there were, they did not thereby become partners as to each other, since the agreement did not constitute such a community of profit as to constitute a partnership. Clark v. Rumsey, 59 App. Div. (N. Y.)) 435, 69 N. Y. Supp. 102. See also Winslow v. Young, 94 Me. 145, 47 Atl. 149.

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to constitute a partnership there must be a joint ownership of the partnership funds, according to the intention of the parties; and an agreement, either express or implied, to participate in the profits and losses of the business, either ratably or in some other proportion agreed upon. To constitute a person a partner in a firm in this sense, he must have an interest in the stock, with the right of control, and thus have a right to the profits as the result of capital and industry in which he and the others concerned are all interested, and must be liable for losses; for a mere participation in the profits of a business by way of payment for his labor and services, without having any interest in the capital stock or right to control the business, does not make him a partner.

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60. If one party furnishes the 58 Ind. 379; Heshion v. Julian, 82 Ind. largest part of the capital, a store 576; Holbrook v. Oberne, 56 Iowa, 324; and a clerk, and the other carries on Porter v. Curtis, 96 Iowa, 539, 65 N. the business, and by the agreement W. 824; Dwinel v. Stone, 30 Me. 384; between them there is to be a divi- Holden v. French, 68 Me. 241; Redsion of the profits, this is a partner- dington v. Lanahan, 59 Md. 429; ship. Cushman v. Bailey, 1 Hill (N. Judson v. Adams, 8 Cush. (Mass.) Y.), 526. So. if one party furnishes 556; Emmons v. Westfield Bank, 97 the capital and the other carries on Mass. 230; Partridge v. Kingman, 130 the business of manufacturing, under Mass. 476; Morrison v. Cole, 30 Mich. an agreement between them that the 102; Stockman v. Michell, 109 Mich. first is to receive back his capital and 348, 67 N. W. 336; Richardson v. a certain portion of the profits made, Hewitt, 76 N. Y. 55; Cassidy v. Hall, this is a partnership. Everett v. Cox, 5 Den. (N. Y.) 180.

61. Ogden v. Astor, 4 Sandf. (N. Y.) 311; Cornell v. Redrow, 60 N. J. Eq. 251, 47 Atl. 56; Leeds v. Townsend, 89 Ill. App. 646; McWilliams v. Elder (La.), 27 South. 352.

Agents and employees given shares of profits. A person is not a partner where he is employed as an agent in conducting the business of a firm at an annual salary, with a stipulation that he is to receive in addition thereto one-third of the profits of the business, not being liable for losses. Vandenburgh v. Hull, 20 Wend. (N. Y) 70. See also Randle v. State, 49 Ala. 14; Wheeler v. Farmer, 38 Cal. 203; Le Fevre v. Cartagino, 5 Colo. 564; Loomis v. Marshall, 12 Conn. 70; Pond V Cummins, 50 Conn. 372; Sankey 7. Columbus Iron Works, 44 Ga. 228; Thornton v. McDonald, 107 Ga. 683, 33 S. E. 680; Stevens v. Faucet, 24 Ill. 483; Burton v. Goodspeed, 69 Ill. 237; Mayfield v. Turner, 180 Ill. 332, 54 N. E. 418; Ellsworth v. Pomeroy, 26 Ind. 158: Emmons v. Newman, 38 Ind. 372; Keiser v. State,

97 N. Y. 159; Leggett v. Hyde, 58 N. Y. 272; La Flex v. Burss, 77 Wis. 538, 46 N. W. 801; Sohns v. Sloteman, 85 Wis. 113, 55 N. W. 158.

And the law is well settled that a mere agent or servant who is bound to obey orders, and has no interest in the capital stock, is not rendered a partner even as to third persons, merely because he is to be compensated for his services by receiving a share of the profits which may arise from the business in which he is employed. Burckle v. Eckhard, 1 Den. (N. Y.) 337. On the other hand, the doctrine has been stated thus: "Traders become partners between themselves by a mutual participation of profit and loss; but, as to third persons, they are partners if they share the profits of a concern; for he who receives a share of the profits, receives a part of that fund upon which the creditors of the concern have a right to rely for payment, and is, therefore, to be made liable for losses, although he may have expressly stipulated for exemption from them." Dob v. Halsey, 16 Johns. (N. Y.) 34, 40. But, as Chief Justice

As was said by Mr. Justice Gray of the United States Supreme Court,62 after an exhaustive review of the authorities, both English and American, relating to the question of what constitutes a partnership: "In the present state of the law upon this subject, it may, perhaps, be doubtful whether any more precise general rule can be laid down than that those persons are partners who contribute either property or money to carry on a joint business for their common benefit, and who own and share the profits thereof in certain proportions. If they do this, the incidents or consequences follow, that the acts of one in conducting the partnership business are the acts of all; that each is agent for the firm and for the other partners; that each receives part of the profits as profits, and takes part of the fund, to which the creditors have a right to look for the payment of their debts; that all are liable as partners on contracts made by any of them with third persons, within the scope of the partnership business; and that even an express stipulation between them that one shall not be so liable, though good between themselves, is ineffectual as against third persons. And participating in profits is presumptive, but not conclusive evidence of partnership."

To subject a person to responsibility as a partner, for the acts of another, done without his express concurrence, he must stand in one or the other of these two positions: first, he must at the time of making the contract, whether bill, note, or other instrument, have been actually a partner in the joint concern; or, secondly, admitting that he was not, he must have represented or permitted himself to be represented as such, before or at the time of making the contract, either generally to all the world, or to several individuals, or to the plaintiff in particular, or to some person through whom he claims.63

Bronson observes, in Burckle v. Eck- 63. Per Tindale, C. J., in the leadhard, 1 Den. (N. Y.) 337: "But this rule is not universal; and the exception which will best reconcile the cases, is least liable to abuse, and is so distinctly marked that it can be easily administered, is that adopted in this State (New York), which allows one man to employ another as a subordinate in his business, and agree to pay him out of the profits, if any shall arise, without giving the party employed the rights or subjecting him to the liabilities of a partner."

62. Meehan v. Valentine, 145 U. S. 611, 12 Sup. Ct. 972, 36 L. Ed. 836.

ing English case of Fox v. Clifton, 6 Bing. 791, and in which he also says: "By the general rule of law relating to partnerships in trade, each member of it is liable to the debts and engagements of the whole company, contracted in the course of the trade. This is a consequence not confined to the law of this country, but extending generally throughout Europe and it is founded partly on the desire to favor commerce, that merchants in partnership may obtain more credit in the world, and more especially on the principle that members of trading