Again, if a person has been induced by fraud to purchase shares, he is entitled to file a bill for a return of the purchase-money, and for an indemnity, and the only necessary party to such a bill is the person who sold the shares. Thus, in Stainbank v. Fernley,' the directors of a joint-stock company, in order to sell their shares to advantage, represented in their reports and by their agents that the affairs of the company were in a very prosperous state, and declared large dividends at a time when the affairs of the company were greatly embarrassed. A person who had been induced by those means to purchase shares of one of the directers, filed a bill against that director, praying to be repaid his purchase-money, and to be indemnified, and offering to re-transfer the shares. A demurrer for want of equity, and because all the other partners ought to have been made parties, was overruled on the ground that the question in the suit was one with which no person was concerned except the plaintiff and the defendant. Rule in Mare v. Malachi. 100 SEC. 228. Another illustration of the same principle is afforded by the case of Mare v. Malachi. There a mining company was formed by the two defendants, who had obtained a lease of the mine proposed to be worked. The plaintiff hadths shares. Some time after the mine had been worked, and, as the plaintiff alleged, at a profit, the defendant sold the mine in order that it might be carried on by a larger company. This sale was concurred in by all the old shareholders except the plaintiff. He contended that he was entitled to adopt or reject the sale; and if he adopted it to be paidths of the consideration for the sale; and if he rejected it to have transferred to him by the defendants such a number of shares as would be equal to ths shares in the original company. The bill was demurred to for want of parties, but the demurrer was overruled by Cottenham, L. C., who held, first, that the new trustees in whom the mine was vested were not necessary parties, inasmuch as the object was to have it decided to whom certain shares belonged; secondly, that the original adventurers were not necessary parties, inasmuch as they had consented to the sale of their interests, and had no further concern with the mine; and, thirdly, that the new adventurers were not necessary parties, because it appeared that the sale was made to the purchasers without notice of the plaintiff's title, and that the defendants possessed in their own right, and unaffected by the claims of others, the subject-matter 19 Sim. 556. 21 M. & Cr. 559. The Lord Chancellor held to which the plaintiff asserted his title. that, as the plaintiff's claim was not made against the corpus of the property, but against that only which, in the shape of money or shares, had come to the hands of the defendants, the objection for want of parties could not prevail. As observed by his Lordship, the plaintiff's case against the defendants came to this-"If; as between you and me the transaction is advantageous, I have a right to claim a corresponding share of the profits and purchase-money which you have received in respect of it. If not, you had no right to convert my shares into money, and I am entitled to have out of the shares in the mine now vested in you a transfer of such a number as will be equivalent to the amount of my interest." Turner v. Hill SEC. 229. The same principle was acted on in the cases of Turner v. Hill, Turner v. Tyacke, and Turner v. Borlase,' in each of which the assignee of a bankrupt shareholder in a cost-book mine filed a bill against one of several persons who had fraudulently purchased the bankrupt's shares, praying for an account of the profits received by such purchaser in respect of the shares he had purchased. Demurrers to these bills for want of parties were overruled on the ground that the only persons really interested in the matters in question in each suit were the plaintiff and the defendant against whom the relief was sought. These cases go even further than Mare v. Malachi, inasmuch as the defendant there was the vendor of the plaintiff's shares, whereas the defendant in each of the other cases was one of several purchasers; but the purchasers were not joint purchasers, and the case against each was distinct from that against the others. Moreover, in Turner v. Hill the bill prayed a receiver of the profits of the mine, but the context showed that the only receiver sought was a receiver of the profits of the shares in question. Persons induced to enter companies by fraud. SEC. 230. Again, where persons have been induced by fraud to subscribe to a bubble company, each one may institute a suit on his own behalf against those who have fraudulently obtained his money, for a return thereof; and in such a case it is not necessary that the other persons defrauded should be parties to the suit, or be represented therein, unless, perhaps, the fraud was the same in each case, e. g., by a representation to the public, by which all were alike deceived." 2 111 Sim. 1, 16, 17. 2 Colt v. Woollaston, 2 P. W. 154; Green v. Barrett, 1 Sim. 45; Cridland v. DeMauley, 1 De G. & S. 459. 3 See Macbride v. Lindsay, 9 Ha. 574. Compare this case with those cited in the last note. Suits against executors of deceased partners for fraudulent acts of deceased. SEC. 231. Whether in a suit against the executor of a partner to make him account for profits made by wrongfully employing the assets of the deceased in the business of a firm of which the executor is a member, it is necessary to make the other members of the firm parties, seems to be open to some doubt; for, whilst in one recent case it was intimated that to such a suit they were necessary parties, in another recent case it was held that they were not, and the two cases seem undistinguishable with reference to this point.' The latter, however, the writer submits to be correct. But although a person may have no interest in the account to be taken, and would, therefore, be an improper party to a mere bill for such account, yet, if an injunction is sought to be obtained against him specially, he must be made a party. For this reason, sheriffs are often made parties to suits in which they have no real interest." Where some partners may sue on behalf of themselves and others. SEC. 232. It has been held in many cases that to a bill praying for a dissolution of a partnership all the partners, however numerous, are necessary parties, and that consequently a bill filed by some on behalf of themselves and others, and praying for a dissolution, is bad on demurrer. This rule is supposed to admit of no exception, and it has, though with expressions of regret, been held to apply to modern companies as well as to ordinary partnerships. The reason given for the rule is that the affairs of a partnership cannot be finally wound up and settled without deciding all questions arising between all the partners, which cannot be done in the absence of any one of them. Even if a partnership is empowered to sue and be sued by a public officer, his presence is not, in a suit for a dissolution, equivalent to the presence of all the parties. 6 Exceptions to the rule that all the partners must be parties to suit for dissolution. SEC. 233. But notwithstanding these numerous authorities, it may be permitted to doubt whether it can be considered as a rule admit 1 Compare Simpson v. Chapman, 4 De G. Mac. & G. 154, and M'Donald v. Richardson, 1 Giff. 81. 2See, for example, Vulliamy v. Noble, 3 Mer. 593; Bevan v. Lewis, 1 Sim. 376. 3 Evans v. Stokes, 1 Keen, 24; Richardson v. Hastings, 7 Beav. 301; Harvey v. Bignold, 8 id. 343; Deeks v. Stanhope, 14 Sim. 57; Wheeler v. Van Wart, 9 Sim. 193; Long v. Yonge, 2 Sim. 369; Ireton v. Lewis, Finch, 96; Moffat v. Farquharson, 2 Bro. C. C. 338. 4 Van Sandau v. Moore, 1 Russ. 441; and Davis v. Fisk, in Farren on Life Assurances, and cited by counsel in Younge's Reports, p. 425. 5 See Richardson v. Hastings, 7 Beav. 307. "See Van Sandau v. Moore, 1 Russ. 441; Davis v. Fisk, cited in You. 425; Abraham v. Hannay, 13 Sim. 581; Seddon v. Connell, 10 Sim. 58. ting of no exception whatsoever, that to every bill, praying for a dissolution, all the partners must individually be parties. All that can on principle be requisite is that every conflicting interest shall be substantially represented by some person before the court. If, which is possible, the interest of each partner conflicts with that of all the others, then all must undoubtedly be parties. But if the partners are numerous, and it can be shown that they are divisible into classes, and that all the individuals in each class have a common interest, then, although the interest of each class conflicts with that of every other class, there seems to be no reason why, if each class is represented by one or two individuals composing it, a decree for a dissolution should not be made conformably with the ordinary doctrines of the court of equity.' There is not, however, so far as the writer is aware, any case in which a decree for a dissolution has actually been made in the absence of any of the partners. There is, it is true, one case in which a bill by some on behalf of themselves and others, praying expressly for a dissolution, was upheld; but the point now in question was not discussed. The case referred to is Cockburn v. Thompson. There a company had proved abortive, and a resolution to dissolve had been made. A bill was filed by several proprietors on behalf of themselves and all the other proprietors against the solicitor and the bankers of the company, and it prayed, inter alia, that the institution might be declared dissolved, that an account might be taken of the moneys received by the defendants on behalf of the proprietors, and that the rights and interests of the plaintiffs and other proprietors might be declared and established. An objection was taken for want of parties, but was disallowed by Lord Eldon. In this case, however, the real object was to make the defendants account for the money they had received; it does not appear from the report that the defendants were proprietors in the concern, and it is clear that the question as to want of parties was not raised with reference to that part of the prayer of the bill which sought a dissolution. The case cannot, therefore, be considered either as opposed to the numerous authorities already cited,' or to be an illustration of the principle that some may represent others in a suit for a dissolution. The question of parties dependent upon rights sought to be enforced. 'See Richardson v. Larpent, 2 Y. & C. C. 514, and the observations of Lord Cottenham in Walworth v. Holt, 4 M. & Cr. 635. 216 Ves. 321. 3 See in Long v. Young, 2 Sim. 380, per V. C. Shadwell. parties turns entirely on the nature of the right sought to be enforced. If an account is required and it is one in which the interest of each partner is distinct from and in conflict with that of all the others, then all the partners, however numerous, must be parties, and their representation by others or by a public officer or secretary will not be sufficient. On the other hand, if there are no such conflicting interests as above supposed, it will be sufficient if each distinct interest is represented by a party to the record. It was held in Walworth v. Holt' that, where partners are too numerous to be brought before the court, and they are divisible into classes, and all the individuals in one class have a common interest, a suit instituted by a few individuals of that class on behalf of themselves, and all the other individuals of the same class against the other members of the company, is sustainable. Since this decision there have been many suits by some shareholders on behalf of themselves and others, praying for very general accounts (but studiously avoiding a prayer for a dissolution), and such suits have been successful whenever the interest of the absent partners has been the same as that of the plaintiffs on the record. For example, it was held in Apperley v. Page, that a bill might be filed by some of the shareholders of a provisionally registered railway company, on behalf of themselves and all the other shareholders, except the defendants, against the directors, although the bill prayed not only for the collection of the joint property and its application in discharge of the joint liabilities, but also for the distribution of the surplus amongst the shareholders. So, in the case of bubble companies, any one of the deceived shareholders may file a bill on behalf of himself and the others, in order to obtain repayment of the deposits or subscriptions which they have been induced to make." When dissolution is not sought. 3 SEC. 235. When no dissolution is prayed, and no winding up of See Van Sandau v. Moore, 1 Russ. 441; Seddon v. Connell, 10 Sim. 58; Abraham v. Hannay, 13 id. 581; McMahon v. Upton, 2 id. 473; Sibley v. Minton, 27 L. J. Ch. 53, V. C. Kindersley. 24 M. & Cr.619; Cockburn v. Thompson, 16 Ves. 321, is an earlier decision on this point. See, too, Good v. Blewitt, 13 Ves. 397. See as to some on behalf, etc., in cases of voluntary societies assuming to be corporations, Lloyd v. Loaring, 6 Ves. 773. 31 Ph. 779; Compare Sibson v. Edgworth, 2 De G. & Sm. 73. 4 See, for other instances, Wilson v. Stanhope, 2 Coll. 629; Harvey v. Col lett, 15 Sim. 332; Cooper v. Webb, id. 454; Clements v. Bowes, 17 Sim. 167, and 1 Drew. 684; Richardson v. Has. tings, 7 Beav. 323; Butt v. Monteaux, 1 K. & J. 98; Sheppard v. Oxenford, id. 491; Sibson v. Edgworth, 2 De G. & S. 73. Compare Williams v. Salmond, 2 K. & J. 463. 5 Blain v. Agar, 2 Sim. 289; Beeching v. Lloyd, 3 Drew. 227; Bryson v. The Warwick, etc., Canal Co., 4 De G. Mac. & G. 711. See, too, Macbride v. Lindsay, 9 Ha. 574; Cridland v. De Mauley, 1 De G. & S. 459; Bell v. Mexborough, 5 Ra. Ca. 149, and 12 Jur. 65. |