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down, that unless there be an authority for that purpose, either expressed or implied, a sale of the whole property by one tenant in common is, with respect to the other, a wrongful conversion of his undivided part (a). How far this general dictum will apply to partners, must in a great measure depend on the mode, extent, and subject of their trade.

But although trover may be maintainable by one partner against another, in the case of a wrongful conversion, yet the general rule is, that one joint tenant or tenant in common cannot bring trover against his companion for a thing still in his possession, because the possession of one is the possession of both; if he do, it is good evidence upon not guilty (6). And hence, the mere taking and refusal to deliver up by one of two joint tenants or tenants in common, will not give the other a right of action against him (c).

l'pon the bankruptcy of one of two partners, the assignees become tenants in common with the solvent partner, his representatives, or assigns, and cannot sue any of these parties in trover for the partnership goods (d).

It may here be remarked, that ejectment will lie by one partner against his copartners on a demise by him to the firm; and that the lessees in such case cannot dispute their lessor's title on the ground of partnership (e).

() / Bey, J., 5 B. & Ald. de la seco, Litt, 900, a. () B. X. 2:34; Brown v. Hedges

, I h. 99); Heideg v. Camsell, it' R . It has been held in Amore than a surviving partner Me maintain derime against the inquination of the dexrwsed partHwy Birthe hands of count, Jure

ray v. Mumford, 6 Cowen, 441.

(c) Fenning v. Lord Grenville, 1 Taunt. 241.

(d) For v. Hanbury, Cowp. 445; Smith v. Stokes, 1 East, 363; Smith v. Oriel, 1 East, 368; Salomons v. Nissen, 2 T. R. 674.

(e) Francis v. Doe, 4 Mee. & W. 331.

259

BOOK THE THIRD

OF THE RELATIVE RIGHTS OF PARTNERS AND THIRD PERSONS.

CHAPTER I.

OF THE LIABILITIES OF PARTNERS FOR THE

ACTS OF THEIR

COPARTNERS.

GENERALLY, under the law of England, one partner has an implied authority to bind the firm by contracts relating to the partnership, whether such contracts be evidenced by bare agreements, oral or written, or by negotiable securities, as bills of exchange and promissory notes (a). To use a strong expression of Lord Kenyon—"One partner may pledge the credit of the other to any amount.” The exceptions to this general rule will be noticed in another chapter. The rule is applicable both to dormant and nominal partners. For, notwithstanding some few dicta which tend to a contrary doctrine (b), it is now an undoubted and universal proposition, that a dormant partner is in all cases liable for the contracts of the firm during the time that he is actually a partner (C); and we have already seen, that a nominal partner is similarly liable during the time that he holds himself out to the world as partner (d).

(a) The firm, however, are not (c) Hubert v. Nelson, Davies' B. bound by entries in the partnership L. 8; Hoare v. Dawes, 1 Doug. 371; books which have not been com- Coope v. Eyre, 1 H. Bl. 37; Robertmunicated to their customer. Simp- son v. Wilkinson, 3 Price, 538; Winson v. Ingham, 2 B. & C. 65. tle v. Crowther, 1 Cromp. & Jerv.

(6) D. Gibbs, J., Young v. Hunter, 316. 4 Taunt. 583; D. Lord Tenterden, (d) Ante, p. 3; p. 60, art. V. 1. Lloyd v. Ashby, 2 Carr. & P. 138.

It makes no difference, as to third persons, whether the partnership is carried on for the benefit of the partners themselves, or for the benefit of their cestui que trusts (a). Both the trustees and the cestui que trusts are liable. In regard to the liability of the latter, this rule has been carried so far, that where A. took a lease of a mine for twenty-one years, and declared himself a trustee for five persons who worked the mine in partnership, it was held, that the lessee being insolvent, the lessor might recover the rent from the partners for the time during which they took the profits; they being deemed in equity in the same situation as if they had been assignees of the

lease (6).

Of course, any arrangement between the partners themselves cannot limit or prevent their ordinary responsibilities to third persons, unless the latter assent to such arrangement. “Suppose a case,” said Lord Tenterden, “where two persons in partnership for the sale of horses agree between themselves never to warrant any horse; yet, though this be their course of business, there is no doubt that if upon the sale of a horse, the property of the partnership, one should give a warranty, the other would be thereby bound (c).” Again, as we shall see presently, it is within the general authority of a partner to bind the firm by drawing, accepting, or indorsing bills of exchange in the partnership name. Now, even if it be agreed that a partner shall not have such authority, and he transgress the terms of the agreement in this respect, the firm will nevertheless be bound, as far as regards all third persons who have no notice of the arrangement. In the case of the South Carolina Bank v. Case (d), Crowder, Perfect, and J. B. Clough carried on business in copartnership, as factors and commission merchants, in England and America; in England, under the firm of Crowder, Clough, & Co.-in America, in the name of Clough alone. When Clough went to America, he had written

(a) Thicknesse v. Bromilow, 2 Crom. & Jerv. 428.

(6) Clavering v. Westley, 3 P.W. 402. For an instance of a partner being considered at law in the light of a tenant, see Doe v. Sales, 1 M. & S. 297.

(c) 2 Barn, & Ald. 697. See

Smith v. Jameson, 5 T. R. 601; Lord Craven v. Widdows, 2 Chan, Cas. 139. An arrangement of this kind by a dormant partner is not more effectual. Hubert v. Nelson, Davies. B. L. 8; Wats. Partn. 168.

(d) 8 Barn. & Cres. 427; 2 Man, & Ryl. 459

instructions from his partners, one of which was—“It is understood that our names are not to appear on either bills or notes for the accommodation of others, and that they should appear as little as possible on paper at all, and then only as regards direct transactions with the house here." Crowder, Perfect, and Clough, in order to obtain consignments from America, made advances, or granted drafts or bills of exchange, or indorsements of them, to their principals, on the security of the goods consigned. In order to obtain a consignment from Weyman, of Charleston, Clough in his own name indorsed bills for him, which were to be provided for by others drawn by Weyman on Crowder, Clough, & Co., in England, which were to be provided for by the proceeds of the consignment. Before the latter bills were presented for acceptance, Crowder and Perfect had become bankrupts; it was held, that the indorsement of the bills by Clough must be considered as an indorsement by the firm, and that the bankrupts and Clough were liable as indorsers of the bills.

On the other hand, where the creditor has express notice of a private arrangement between the partners, by which either the power of one partner to bind the firm, or his liability in respect of partnership contracts, is qualified or defeated; in such case, it is clear that the creditor himself must be bound by the arrangement between the partners. In Minnet v. Whitney (a), three persons were in partnership as sugar brokers; and after the trade had been carried on some time, one of the partners gave notice of his intention to withdraw from the firm, which was agreed to. Afterwards the other partners treated with a trader for some raw sugar. The retiring partner then gave notice to the trader, that he would not be accountable for any sugars which the remaining partners might buy of him; and the trader having answered that he was satisfied with the security of the remaining partners only, the retiring partner was held not liable. So, in the case of Ex parte Harris (6), wines were ordered in the joint names of two partners, A. and B. Before the delivery of them the partnership was dissolved, and the creditors had notice of the dissolution. The creditors drew a bill upon both partners for the

(a) 5 Bro. P. C. 489; 16 Vin. Abr. 244. See Vice v. Fleming, 1

Younge & Jerv. 227.

(6) i Madd. 583.

wines; but when it was presented at the house where the partnership had formerly been carried on, and where A., the remaining partner, carried on his separate concern, A. refused to accept the bill in the partnership firm, and accepted it only on his separate account, and in his own name, and the wines were afterwards delivered to A.; it was held that the delivery of the wines was made to A. only, and that B. was not liable in respect of this contract.

Upon the same principle, where the creditor has express notice, that by an arrangement between the partners, one of them, though appearing to the world as a partner, is not to participate in the profit and loss, and is not to be liable as a partner, the creditor will be bound by the arrangement (a).

It seems also, that the mere disclaimer by one partner, of the future contracts of his copartner, will be binding on third persons, whatever be the effect of such an act between the parties themselves, or whether it be or be not in conformity with the partnership agreement. Thus, in Willis v. Dyson (6), one of two partners sent a circular in these words :-“I am sorry that the conduct of my partner compels me to send the annexed circular. I recommend it to you to be in possession of my individual signature before you send any more goods.” The partnership was afterwards dissolved. There appears to have been no proof of any misconduct on the part of the accused partner. But Lord Ellenborough ruled, that a person who had supplied goods between the times of the receipt of the letter and of the dissolution, could not charge the firm, unless he could prove some act of adoption by the partner who gave the notice, or that he derived some benefit from the goods.

Hlaving made these preliminary remarks, we will proceed to examine, seriatim, the various liabilities which may be incurred by one partner for the acts of his copartner.

(a) Alderson v. Clay, 1 Camp. 404. But see Brown v. Leonard, 2 Chit. 120.

(6) 1 Stark. 164. See also

v. Layfield, 1 Salk. 291; Minnet v. Whitney, supra; Rooth v. Quin, 7 Price, 193; Lord Galway v. Mathew, 1 Camp. 438.

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