concerned. But, in such cases, we must remember the words of Lord Mansfield:-" The objection, that a contract is immoral or illegal, sounds, at all times, very ill in the mouth of a defendant. It is not for his sake, however, that the objection is ever allowed; but it is founded in general principles of policy, which the defendant has the advantage of, contrary to the real justice as between him and the plaintiff. The principle being e dolo malo non oritur actio (a).”

SECTION II.

Of the Contract of Partnership quoad third Persons.

We have already had occasion to observe that individuals become liable as partners quoad third persons, either by contracting the legal relation of partners inter se, or by holding themselves out to the world as partners. To speak correctly, these are the only means of incurring the liability in question. For, although it appears to be laid down, that they who are not partners inter se, may nevertheless, even without holding themselves out in that character, be partners quoad third persons (b); this, surely, must be understood to mean, that they who stipulate not to be partners inter se, may nevertheless be liable to third persons. It is certainly clear, that a person may stipulate not to be a partner, and yet, contrary to his express intention, and by the very same instrument by which he stipulates, he may enter into such terms as by law constitute a partnership. He will then unquestionably be liable to third persons; but, on the sole ground, that he has entered into a legal contract, which, as between himself and the world, controuls the stipulation (c). It must be admitted, that this doctrine is inconsistent with the case of Hesketh v. Blanchard; but we shall endeavour, in a future page, to shew that that decision stands on questionable principles.

(a) Per Lord Mansfield, Holman

v. Jackson, Cowp. 341.

10; Car. Partn. 7.

(c) Consider Geddes v. Wallace,

(b) Wats. Partn. 33; Gow, Partn. 2 Bligh, 270.

II. It is clear, from what appears in the foregoing section, that the main feature in the contract of partnership is the communion of profit between the parties. Without that quality, a partnership cannot exist; and with it, a case can hardly be stated in which a partnership shall not exist. Persons, therefore, who are known to share the profits of a trade, are prima facie liable as partners to all who deal with them in respect of that trade, whatever be the private agreement between them.

One of the earliest cases on this subject is that of Bloxam v. Pell (a), in which the parties, by their agreement, seem to have intended a dissolution of the partnership; yet, as Pell, the retiring partner, retained an interest in the profits, and as the legal presumption of partnership with Brooke was not rebutted, Lord Mansfield held, that Pell was a dormant partner and liable to third persons. The facts were these: Brooke and Pell had commenced partnership for seven years. At the end of the first year they agreed to dissolve partnership, but no express dissolution was had. The agreement stated, that Brooke, being desirous to have the profits of the trade to himself, and Pell being desirous to relinquish his right to the trade and profits, it was agreed, that Brooke should give Pell a bond for £2485, which Pell had brought into the trade, with interest at £5 per cent., which was accordingly done. And it was further agreed, that Brooke should pay to Pell £200 per annum for six years, if Brooke so long lived, as in lieu of the profits of the trade; and Brooke covenanted that Pell should have free liberty to inspect his books. Brooke became a bankrupt before anything was paid to Pell. And this action being brought for a debt incurred by Brooke in the course of trade, Lord Mansfield held, that Pell was a secret partner.

The decision in Bloxam v. Pell was sanctioned by the observations of Lord Chief Justice De Grey, in Grace v. Smith (b); but the foregoing principles were very fully discussed and completely established in the celebrated case of Waugh v. Carver (c), in which it was decided that persons are answerable to the world as partners, if they participate in the profits of a trade, although they may have entered into an express agree

(a) 2 Sir W. Bl. 999.

See ante,

p. 28.

(b) Ante, p. 26.
(c) 2 H. Bl. 235.

ment not to be partners inter se. That was an action of assumpsit for goods sold and delivered, work and labour done, &c., in which a verdict was found for the plaintiff, subject to the opinion of the Court on a case which was in substance as follows:-In February, 1790, articles of agreement were executed between the defendants Erasmus and William Carver, of Gosport, in the county of Southampton, merchants, of the one part, and Archibald Giesler, of Plymouth, in the county of Devon, merchant, of the other part; whereby, after reciting that the respective parties had received appointments from various foreign ship-owners, merchants, and insurers, to act as their agents in the south of England, and that it had been agreed that Giesler should remove from Plymouth, and establish himself at Cowes; and that the respective parties should allow to the other certain portions of each other's commissions and profits, in manner thereafter more particularly mentioned and expressed; the said Giesler covenanted, promised, and agreed to and with E. and W. Carver, that the said Giesler would, when required so to do by the said E. and W. Carver, remove from Plymouth, and establish himself at Cowes, for the purpose of carrying on a house there in the agency line, on his own account; but, in consequence of the promised assistance and recommendations of the said E. and W. Carver, would well and truly pay to the said E. and W. Carver one full moiety or half part of the commission agency to be received on all such ships or vessels as might arrive or put into the port of Cowes, or remain in the road to the westward thereof, within the Needles, of which the said Giesler should procure the address, and likewise one full moiety or half part of the discount on the bills of the several tradesmen employed in the repairs of such ships or vessels. And the said E. and W. Carver, for the considerations thereinbefore mentioned, covenanted with the said Giesler, that they would well and truly pay to the said Giesler, his executors, administrators, or assigns, three fifth parts or shares of the commission or agency to be received by the said E. and W. Carver, on account of all such ships or vessels, the commanders whereof should in consequence of the endeavours, interference, or influence of the said Giesler, proceed from Cowes to Portsmouth, and there put themselves under the direction of the said E. and W. Carver; and likewise one and one half per cent. on the

amount of the bills of the several tradesmen employed in the repairs of such ships or vessels, together with one fourth part of such sum or sums as should be charged or brought into account for warehouse rent, on the cargoes of such ships or vessels, respectively; and also one sixth part of such sum or sums as should be charged or brought into account for warehouse rent on the cargoes of such ships or vessels as should be landed at Cowes aforesaid. And also, that they the said E. and W. Carver would well and truly pay unto the said Giesler one fourth part or share of the commission or agency to be received by the said E. and W. Carver, on account of all such ships or vessels that should arrive or put into the port of Portsmouth, or remain in the limits thereof, under the care and direction of the said E. and W. Carver, and likewise one half per cent. on the amount of the bills of the several tradesmen employed in the repairs of such ships or vessels. The articles then provided that one fifth part of the commission or agency on each ship should be first retained by the party under whose care such ship or vessel should be, as a full compensation for clerks, boat hire, and all other incidental charges and expenses in regard of such ships or vessels respectively; after which deduction, the then remaining balance of such commissions or agency should be divided between the said E. and W. Carver, and the said Giesler, in the proportion therein before mentioned. The articles then, after providing for the term of the contract, and that neither party should be connected with other houses in ship agency during that term, contained the following clause: "And it is hereby likewise covenanted, declared, and agreed, by and between the said E. and W. Carver, and the said Archibald Giesler, that each party shall separately run the risk of, and sustain, all such loss and losses as may happen on the advance of monies, in respect of any ships or vessels under the immediate care of either of the said parties respectively; it being the true intent and meaning of these presents, and of the parties hereunto, that neither of them the said E. and W. Carver and A. Giesler, shall at any time or times during the continuance of this agreement, be in anywise injured, prejudiced, or affected, by any loss or losses that may happen to the other of them, or that either of them shall in any degree be answerable or accountable for the acts, deeds, or receipts of the other of them, but that each of them,

the said E. and W. Carver, and A. Giesler, shall in his own person, and with his own goods and effects, respectively, be answerable and accountable for his own losses, acts, deeds, and receipts." In pursuance of these articles, Giesler removed from Plymouth, and settled at Cowes, where he carried on the business of a ship-agent in his own name, and contracted for the goods, &c., which were the subject of action; and the question was, whether the defendants were partners, on the true construction of the articles.

On the part of the plaintiffs it was urged, that, looking to the terms of these articles, it was impossible to express more clearly an agreement to participate in the profits of the business of ship-agents, and to establish a joint concern between the houses, and that such a participation in the profits made them partners. That it might be objected, that there was a proviso that neither party should be answerable for the losses of the other; but this certainly would not be binding on the creditors. For the defendants it was urged, that this was no partnership quoad the world, because, on the authority of Puffendorf, there was no partnership between the parties: it was merely a purchase of Giesler's profits, by giving him a share of Carver's, to prevent a competition between them.

The Court of Common Pleas held, that the defendants were liable as partners; and Eyre, C. J., concluded a learned and elaborate judgment with the following observations :-"It is plain upon the construction of the agreement, if it be construed only between the Carvers and Giesler, that they were not, nor ever meant to be partners; they meant each house to carry on trade without risk of each other, and to be at their own loss. Though there was a certain degree of controul at one house, it was without an idea that either was to be involved in the consequences of the failure of the other, and without understanding themselves responsible for any circumstances that might happen to the loss of either. That was the agreement between themselves. But the question is, whether they have not, by parts of their agreement, constituted themselves partners in respect to other persons. The case, therefore, is reduced to the single point, whether the Carvers did not entitle themselves, and did not mean to take a moiety of the profits of Giesler's house, generally and indefinitely as they should arise, at certain times agreed upon for the settlement of their ac