be no dissolution on the 1st of January next ensuing. It was held, that this agreement did not suspend the plaintiff's right to sue the defendant for the separate debt due from him to the plaintiff. In delivering the judgment of the Court, Park, J., observed, that although by the stipulation of interest at £2 per cent. for six months, it seemed probable that it was in the contemplation of the contracting parties to suspend any proceedings at law for that period at least, yet it was certainly quite clear that there was no precise stipulation for a suspension; and, therefore, how could the Court say to what period that stipulation should extend? He added, that the stipulation also, that the defendant's share of the partnership assets, when received by the plaintiff, should go in discharge of the private debt, was an advantage to the defendant, for it gave him a legal set-off to that extent; whereas, without such stipulation, the plaintiff might have sued for the whole private debt, and left the defendant to a suit in equity to recover his share. This seemed another reason for not considering anything in the agreement as amounting to a suspension.

Where, by a deed of trust executed by A., one of several partners, the trustees were to stand possessed of that partner's share upon trust, "thereout to pay the just proportion or share of him the said A., of all such debts as were or should thereafter appear to be owing from him jointly and as a copartner;" it was held, that this provision referred not to what, as among the partners, A. might be bound to contribute, but to what, with reference to the state of the partnership funds, and the ability of the other partners, he might eventually be called on to contribute to the joint debts; so as they might be fully paid (a).

It may here be remarked, that, although different classes of creditors are specified by a deed of this nature, yet the Court always leans in favour of an equal payment; and a declaration, that one class, as, for instance, separate and scheduled creditors, are to be paid rateably and in proportion to each other, is not of itself sufficient to prove that they are not also to take rateably and in proportion with the other creditors, as, for instance, the joint creditors (b).

(a) Wadeson v. Richardson, 1 Ves. & B. 103.

(b) Ibid. See Pearce v. Slocombe, 3 You. & Col. 84.

A deed of dissolution, which on the face of it purports to settle all past transactions, and to prevent all future reckonings between the parties, will extend, under certain circumstances, to contracts which were not originally partnership contracts. In Belcher v. Sikes (a), an indenture of dissolution, after reciting that A. and B., in May, 1813, had entered into a contract with the commissioners for victualling the navy, to supply his Majesty's ships with sea-provisions and victualling stores, and that the said A. and B., in September, 1813, had mutually agreed to dissolve the copartnership entered into by them as aforesaid, for carrying on the business of the said contract, and all other contracts entered into with the commissioners by B. or A., and in which they or either of them were in anywise interested &c., witnessed, that A. and B., by mutual consent, dissolved the said copartnership so entered into, and then or lately subsisting between them, under or by virtue of the said recited contract, and of all other contracts in which B. and A., or either of them, had any interest or concern as aforesaid. The deed then contained a mutual release of all actions, accounts, reckonings &c., for or by reason of the said copartnership or copartnerships so thereby dissolved as aforesaid, or for or by reason of any of the acts, matters, and things whatever in anywise relating to the said recited contract, and all other contracts in which B. and A., or either of them, had any interest whatsoever. B. then assigned to A. all the share and interest of him (B.) of and in all the debts and sums of money whatsoever, then due and owing to them (A. and B.), under or by virtue of the same several contracts or otherwise, and all bonds, bills, &c., relating to the said contract, debts, and sums of money, or any part thereof, and all the goods, stock, and effects whatsoever then belonging to them, the said A. and B., as such copartners respectively, and all the right, title, and interest of him (B.) of, in, to, from, out or in respect of the premises; and a power was then given to A. to recover and give discharges for the said debts. At the time when this deed was executed, B. and A. had been concerned in conducting business together as contractors for the navy. In some contracts, B. was solely interested as contractor; in others, A. was solely interested as contractor; and in some, they were jointly interested as partners and contractors.

(a) 8 B. & C. 185; 9 D & R. 231.

They had, however, both been concerned in all the contracts; A. having been agent in managing those contracts in which B. was solely interested, and B. having been agent in managing those contracts in which A. was solely interested; and there was money due from the commissioners of the navy in respect of each of these classes of contracts. The Court of King's Bench held, that by this deed the contracts in which B. had been originally separately interested were constituted as between A. and B. partnership contracts, and, consequently, that A. was entitled by the deed to receive all sums due to B. in respect of those contracts, at the time of the execution of the deed.

Where, upon the dissolution of a partnership, it is agreed that certain specific articles shall become the exclusive and separate property of one of the partners, that agreement is final, and the other partners have no lien upon that property in case of a deficiency of assets. Thus, upon the dissolution of a partnership between A. and B., coach-founders, it was agreed that B. should have a certain book used in their trade, containing plates of the articles they sold; that until a copy thereof was made for A., the latter should have the use of the original; and that a fund should be appropriated to the payment of the partnership debts. The partnership was dissolved upon these terms, and B. entered into a fresh partnership with the plaintiff. B. having become bankrupt, and the fund having proved insufficient, A., who had got the book into his possession, refused to deliver it up until B.'s estate should have been applied to make up one moiety of the deficiency. Upon a bill filed by B.'s partner to enforce his right to have a copy of the book made and delivered to him, it was decreed according to the prayer of the bill, with costs (a). Sir J. Leach, in delivering judgment, observed, that if this reference book remained partnership property, it would be unquestionable that the plaintiff could not be entitled to relief without a general arrangement of the partnership concerns; for, until such general arrangement, no partner could claim an exclusive right in any article of the partnership property. But, upon a dissolution, any part of the partnership property might, by contract of the partners, be converted into the separate individual property of either; and

(a) Lingen v. Simpson, 1 S. & S. 600.

it was clear here that, upon the dissolution, the book became the separate property of B., subject to the delivery of the copy to the defendant, and the interim inspection. The plaintiff's claim, therefore, did not refer to any article of partnership property.

Where a retiring partner takes from the continuing partner a covenant or bond of indemnity against the partnership debts, that bond or covenant may be enforced by a decree for specific performance (a).

IV. This section may be concluded with the observation, that in cases of extensive partnerships acting by means of directors and other officers, and regulated by a deed containing a great variety of laws and stipulations, a Court of equity will frequently decline to interfere to relieve those parties, who have not in the first instance endeavoured to avail themselves of the provisions of their deed (b).

(a) Warren v. Taylor, 8 Sim. 599.

(b) Ellison v. Bignold, 2 Jac. & W. 503: Waters v. Taylor, 15 Ves. 10.*

M

162

CHAPTER III.

OF THE LEGAL AND EQUITABLE REMEDIES BETWEEN
PARTNERS.

SECTION I.

Of the Enforcement of Covenants between Partners.

ONE partner may maintain an action of covenant against his copartner, whether the covenant be to pay any sum or do any act for the purpose of only launching the partnership (a), or whether it be to perform any of the articles after the partnership has actually commenced (b). It seems, however, that this proposition must not be extended to the case where the damages to be recovered are, of necessity, payable out of, or, when recovered, payable into the partnership fund; because, in this case, the party bringing the action is liable to contribute to the fund out of which he seeks payment (c).

An action of covenant will lie, although there may be accounts between the parties which require unravelling in equity (d). And where partnership covenants have not been infringed for any length of time, the action of covenant is the proper remedy; a Court of equity in such case not interfering to restrain the breach of covenant, unless the bill pray and there are just grounds for a dissolution. In the case of Marshall v. Colman (e), articles of partnership were entered

(a) Walker v. Harris, ante, p. 136; Ex parte Notley, 1 Mont. & A. 48.

(b) Want v. Reece, 1 Bing. 18; Hatcher v. Seaton, 2 M. & W. 47.

(c) 1 Bing. N. C. 407. But see

post, book 5, chap. 1, sect. 3, art.
V. 2; and Andrews v. Ellison, 6 B.
Moore, 199.

7.

(d) Venning v. Leckie, 13 East,

(e) 2 Jac. & Walk. 266.