or

that he has ostensible authority to cancel

$ 2395. satisfy the purchaser's indebtedness to

1. Partnership, what is a.- A partnership the company by assuming, for a consideration entirely personal to himself, personal

for the purpose of dealing in real estate and

dividing the profits may be formed by oral liability for such indebtedness.-Wiley B.

agreement and its continuation proved by Allen Co. v. Wood, 32 Cal. App. 76, 162 Pac.

parol evidence.-Arnold v. Loomis, 170 Cal. 121.

95, 148. Pac. 518. $ 2319.

2. It is not of the essence of a partner

ship that the parties to it should have 1. What agent can not do.-A local man

known that their contract in law created a ager of a piano company who is authorized

partnership; if by contract or by conduct or to receive money for it from its patrons and

by both they have in point of law engaged execute and deliver receipts therefor in the

in a partnership venture, so far as third company's rame does not have implied authority to make settlements with debtors

persons are concerned they can not be heard of the company on

to deny the relationship and the liabilities a basis different from

arising therefrom.-Westcott v. Gilman, 170 that prescribed by the company's contracts

Cal. 562, Ann. Cas. 1916 E 437, 150 Pac. 777. with its debtors, or to deliver receipts for

3. money in the company's name when none is

A partnership may be organized for actually paid.—Wiley B. Allen Co. v. Wood,

the prosecution of one or two adventures,

as well as for the conduct of a general and 32 Cal. App. 76, 162 Pac. 121.

continuous business.—Westcott v. Gilman, $ 2330.

170 Cal. 562, Ann. Cas. 1916E 437, 150 Pac.

777. 1. Acts of agent-Scope of authority.

4. An agreement for engaging in a cerAn agent of the pledgor of corporate stock

tain building venture wherein the skill and is liable to his principal for damages result

labor of the one were to be combined with ing from the sale of the stock by such agent

the capital of the other with an equal diviin a wrongful and negligent manner.-Lem

sion of the profits and losses satisfies the v. Wilson, 27 Cal. App. 512, 150 Pac. 641. code definition of a partnership.-Lanpher v. 2. An agent may not, as such, make a

Warshauer, 28 Cal. App. 457, 152 Pac. 933. secret profit out of a transaction wherein he represents his principal.—Teats v. Caldwell,

$ 2404. 28 Cal. App. 206, 151 Pac. 973.

1. 3. The fact that an agent is acting gratu

Partnership-When division of losses itously does not justify him in making a

implied.-Where it is understood that the secret profit out of a transaction in which he

parties to

to

a business transaction are represents his principal.—Teats v. Caldwell,

share equally the profits, and that the ex28 Cal. App. 206, 151 Pac. 973.

penses should be paid out of the proceeds

of the business, there is an equal liability 8 2332.

for the losses which the law will imply.1. Notice to agent -“Stable bucks.”—

Irvine & Muir Lumber Co. v. Holmes, 26 Cal. Where it appears, in an action to recover for

App. 453, 147 Pac. 229. personal injuries sustained by the plaintiff while driving a team furnished him by the

2411. defendant, that the defendant kept in charge 1. Good faith between partners.--Where of its stables no responsible person and no

in an action for the dissolution of a partnerperson at all other than "stable bucks," ship and for an accounting it is found that whose authority was limited simply to the the defendant was induced to enter into the feeding of the animals and at times to hook- partnership agreement solely by reason of ing them up, such "stable bucks" were suffi- the fraudulent representations of the plainciently in charge to warrant the lodging of tiff, the latter is not entitled to any relief.complaints with them as representatives of Miller v. Kraus, 51 Cal. Dec. 154, 155 Pac. their employer, and knowledge of the com- 834. plaints thus lodged were imputable to such 2. Partnership contracts create a fiduemployer.-Barrett v. Metropolitan Contract- ciary relation between the partners, and ing Co., 172 Cal. 116, 155 Pac. 645.

they must be founded in good faith and 2. -Notice to husband. Where there upon the consent of the parties for a lawful was no evidence that the husband was the purpose; where one of the parties to an wife's agent or authorized by her to borrow agreement of partnership has been induced money upon the security of the wife's prop- to enter into it by the fraudulent represenerty, except the declarations of the husband, tations of the other, the partnership may be which were incompetent, notice of the trans- declared void and dissolved, or, what in action can not be imputed to the wife under effect amounts to the same thing, the agreesection 2332 of the Civil Code; nor can ment of partnership rescinded.-Miller V. such an agreement be upheld as an executed Kraus, 51 Cal. Dec. 154, 155 Pac. 834. agreement binding the wife, the husband not 3. Where one who has been induced to having had any authority, actual or osten- enter into a partnership agreement by fraud sible, to make the agreement, and it not elects to avoid the contract, the situation appearing that he was the general agent of becomes, as between the partners, as though the wife.-Raleigh v. Lee, 26 Cal. App. 229, no partnership ever existed, although the 146 Pac. 696.

defrauded partner, if he has held himself out ch.II,arts.I-VII.) as an apparent member of the firm, may be ship assets be applied to the payment of the liable to creditors of the partnership.-Mil- partnership debts.-Rapple v. Dutton, 226 ler v. Kraus, 51 Cal. Dec. 154, 155 Pac. 834. Fed. 430.

1.

§ 2412.

8 2458. 1. Liability to account-Right not lost, 1. Powers of partners after dissolution.when.—The right of the partner who was to Upon the dissolution of a partnership each contribute his skill and labor to the building member thereof, in the absence of an agreeventure to come into a court of equity and ment to the contrary, has the same right have an accounting and settlement of the and authority to collect, compound, and repartnership affairs, is not lost by reason of lease the debts of the firm existing at the the fact that he abandoned the work before time of the dissolution; such members, howits completion.-Lanpher V. Warshauer, 28 ever, may by agreement restrict such right Cal. App. 457, 152 Pac. 933.

and commit the liquidation of its affairs, or

any part thereof, to one or more members. 2442.

Hill v. Maryland Casualty Co., 28 Cal. App. LIABILITY OF PARTNERSHIP TO THIRD

422, 152 Pac. 953. PERSONS. 1. Liability of copartners.

8 2466. 2. Liability of members of unincorporated

Fictitious partnership name Construcassociation.

tion.—A firm name of "Abrams Bros." is not 3. Liability of retiring partner.

a designation "showing the names of the

persons interested as partners" within the 1. Liability of copartners.-A copartner, meaning of this section.—North v. Moore, while his obligation is joint, is still liable 135 Cal. 621, 67 Pac. 1037. to a creditor for the entire amount of the 2. The identity of the partners is not debt.-Brazil v. Azevedo, 32 Cal. App. 364, shown in the designation "P. H. Murphy and 162 Pac. 1049.

Son."-Schwartz v. Marcuse, 22 Cal. App. 2. Llability of members of unincorporated Dec. 1063. associations.-While as between the mem

3. The statute not only requires that the bers of an unincorporated association each names of the persons comprising the fictiis bound to pay only his numerical propor- tious partnership must be stated but truthtion of the indebtedness of the concern, yet fully stated. One can not be permitted to as against the creditors, each member is do business under a fictitious name and be individually liable for the entire debt pro- protected by a certificate that falsely reprevided, of course, the debt is of such a nature sents the names of the partners to be some and has been so contracted as to be binding other persons. The very object of the staton the association as a whole,

An ute would be thwarted if such evasion were unincorporated association organized for countenanced.-Schwartz v. Marcuse, 22 Cal. business or profit is in legal effect a mere App. Dec. 1063. partnership so far as the liability of its 4. -Certificate setting forth initials only. members to third persons is concerned; and -A certificate of copartnership which sets accordingly, each member is individually forth the initials of the respective partners' liable as a partner for a debt contracted by given names instead of their names in full the association.-Webster v. San Joaquin is sufficient when the partners are generally Fruit and Vegetable Growers' Protective known by the names as thus given.-Hill v. Assn., 32 Cal. App. 264, 162 Pac. 654.

Nerle, 29 Cal. App. 473, 156 Pac. 981, 3. Liability of retiring partner.-A retir. ing copartner may be held for the obliga- 8 2468. tions of the partnership theretofore created.

1. Filing certificate of partnership-Con-Mission Fixture Co. v. Potter, 26 Cal. App.

struction.-An action commenced before the 691, 148 Pac. 223.

amendment of 1911 is governed by the law

as it stood then which permitted assignees $ 2450.

of such partnerships to maintain suits.1. Total dissolution of

partnership. - Creditors' Adjustment Co. v. Rossi, 26 Cal. Where a partnership is dissolved by a de- App. 725, 148 Pac. 528. cree of a court of equity, the court will see 2. The word "maintain” as used in secthat the property of the partnership is tion 2468 of the Civil Code providing that properly and equitably divided according to

“no person doing business under a fictitious the circumstances of the case as disclosed name

his assignee,

shall by the proofs.----Miller v. Kraus, 51 Cal. Dec. maintain an action," etc., means to com154, 155 Pac. 834.

mence, institute, begin, or bring.--Creditors'

Adjustment Co. v. Rossi, 26 Cal. App. 725, § 2451.

newspaper known as the San Francisco Call, and that the plaintiff is engaged in conducting the business of publishing said newspaper under the

name of his agent W. W. Chapin, who is the ostensible publisher. The particular transaction on which the contract is based, which is set forth in full in the complaint, shows on its face that W. W. Chapin is the publisher of said newspaper. It is not contended that the name W. W. Chapin is fictitious.-Spreckels v. Grace Darling Hospital Assn., 28 Cal. App. 646, 153 Pac. 718.

4. -Raising question of capacity to sue.The question as to plaintiff's want of legal capacity to sue may be raised by special demurrer on that ground, when the fact that he is doing business under a fictitious name within the meaning of section 2466 and this section appears upon the face of the complaint.-Spreckels v. Grace Darling Hospital Assn., 28 Cal. App. 646, 153 Pac. 718.

2. It is essential to the existence of a mining partnership that the parties actually work the mine together for their mutual benefit, the parties to contribute to the expenses of the work and to share in the profits according to their respective interests.-Peterson v. Beggs, 26 Cal. App. 760, 148 Pac, 541.

3. An agreement between attorney and client that the former is to sell mining properties of which he holds the title in trust for both, and from the purchase price from time to time deduct a sum sufficient to repay to him all sums paid out for the benefit of the properties and to compensate him for his legal services, and that after such repayment and the payment of the expenses of the sales, the sums remaining are to be divided equally between the parties, and any remaining property held as joint owners, does not constitute them mining partners, and the attorney is not liable for the services of a watchman or keeper employed by the client.---Peterson v. Beggs, 26 Cal. App. 760, 148 Pac. 541.

4. Cotenants of a mine are not necessarily mining partners, or partners at all; the partnership arises only when the COowners unite and co-operate in working the mine.-Peterson v. Beggs, 26 Cal. App. 760, 148 Pac. 541.

2512. 1. Mining partnership - Express agreement not necessary.-A mining partnership is not created by an agreement between persons who combine to acquire, develop, and deal in mines, unless the agreement contemplates the actual joint working of the mines by the parties upon the acquisition and development of the property.-Peterson v. Beggs, 26 Cal. App. 760, 148 Pac. 541.

TITLE IX.

INSURANCE.

an

a

§ 2581.

landlord.--Covey v. National Union Fire Ins.

Co., 31 Cal. App. 579, 161 Pac. 35. 1. Material misrepresentation.--For a pro

2. Service of notice of disagreement or fessional gambler to allow insurance

demand for appraisement within the time agent to state his business as that of a

required by a policy of fire insurance, pro"capitalist” is to make a material misrepre- viding that the company "shall be deemed to sentation.—Elliott v. Frankfort Marine etc. have waived assent to the amount of the Ins. Co., 172 Cal. 261, L. R, A. 1916F 1026, 156 loss claimed by the insured in his prelimiPac. 481.

nary proof of loss, unless within twenty 2. It is also a material misrepresentation

days after receipt thereof

. the for an applicant for insurance to state that

company shall notify the insured in writhe is of good habits, when he is living with

ing," etc., is not made where given by letter woman who is not his wife.-Elliott v.

mailed on the twentieth day after receipt Frankfort Marine etc. Ins. Co., 172 Cal. 261,

of proof of loss to the insured residing at a L. R. A. 1916F 1026, 156 Pac. 481.

different place and received by him two days after mailing.–Covey v. National Union Fire

Ins. Co., 31 Cal. App. 579, 161 Pac. 35. $ 2586.

3. Service of demand for an appraisement 1. Insurance-Construction of policy.-A of loss within the time required by a policy building is not vacant or unoccupied within of fire insurance, providing that "if for any the meaning of a clause in a policy of fire reason not attributable to the insured or to insurance providing that the company will the appraiser appointed by him, an appraisenot be liable for loss or damage occurring ment is not had and completed within ninety while the building is vacant or unoccupied days after said preliminary proof of loss is beyond the period of ten consecutive days, received by this company, the insured is not where at the time of the fire the tenant who to be prejudiced by the failure to make an had occupied the premises for a year as a appraisement and may prove the amount of dwelling for himself and his family had va- his loss in an action brought without such cated the possession of the premises, but appraisement," is not made, where given by had not removed all of his household effects letter mailed before the expiration of the therefrom, or surrendered possession to the ninety day period, but not received until after the expiration thereof.-Covey v. National Union Fire Ins. Co., 31 Cal. App. 579, 161 Pac. 35.

total loss under a policy of marine insurance it is not necessary that there should be an actual abandonment, it being sufficient if the right to abandon exists. — Victoria S. S. Co. v. Western Assur, Co., 167 Cal. 348, 139 Pac. 807.

8 2608.

1. Warranties in insurance-Construction of section.-A warranty is deemed material when it is "to do or not to do a thing which materially affects the risk.” This section is not applicable only to implied warranties.Victoria S. S. Co. v. Western Assur. Co., 167 Cal. 348, 139 Pac. 807.

8 2610.

1. Acts voiding insurance policy -Construction.-- This is not confined to implied warranties alone.-Victoria S. S. Co. v. Western Assur. Co., 167 Cal. 348, 139 Pac. 807.

$ 2705.

1. Maritime insurance Constructive total loss.--In order to constitute a constructive

$ 2717.

1. Maritime insurance-When freightage may be abandoned (subd. 4). Where there is an actual total loss and destruction of the ship and an actual abandonment, no constructive abandonment is necessary as to the ship. Hence freightage may be structively abandoned notwithstanding the provision of the last sentence of subd. 4, that “freightage can not in any case be abandoned, unless the ship is also abandoned." Victoria S. S. Co. v. Western Assur. Co., 167 Cal. 348, 139 Pac. 807.

con

CHAPTER IV.

LIFE AND HEALTH INSURANCE.

$ 2767. Disposition by beneficiary of interest in installment [new].

8 2767. DISPOSITION BY BENEFICIARY OF INTEREST IN INSTALLMENT. The beneficiary under a policy of life insurance, providing for the payment of the proceeds thereof in periodical installments, may be restrained from disposing of or incumbering his interest in any such installment, prior to the date when it shall become due and payable by the insurer, by a condition or stipulation in the policy.

History: Enactment approved May 29, 1917, Stats, and Amdts. 1917, p. 1314. In effect July 28, 1917.

$ 2778

referred to in the body as "the undersigned.”

-Union Trust Co. v. Dickinson, 30 Cal. App. 1. Indemnity insurance Construction of

91, 157 Pac. 615. section (subds. 5 and 6).- These two subdivisions merely declare rules of evidence under which a judgment recovered against

§ 2806. the indemnitee may become prima facie or 1. Guaranty-How construed.-A contract conclusive evidence of liability in his action guaranteeing an account to a stated amount against the indemnitor.- Eva V. Andersen, "provided the amount may be due and pre166 Cal. 420, 137 Pac. 16.

sented" to the guarantor by a specified date, 2. —Pleading and proof (subd. 4).-In an is a conditional one dependent upon presentaaction to enforce a contract of indemnity tion and demand being made within the it is not necessary to allege that suit has time limited in the proviso, and when the been brought against the indemnitee and an demand is not made until after the time opportunity given the indemnitor to defend specified no liability accrues upon the conit. The notice to be given to the indemnitor tract.-Schwab v. Bridge, 27 Cal. App. 204, is not compulsory. The failure to give notice 149 Pac. 603. to the indemnitor does not go to the right 2.

A guaranty for the payment of rent of action against him, but simply changes reserved under the terms of a lease of real the burden of proof and imposes upon the

property for a period of ten years at a indemnitee the necessity of again litigating

monthly rental of six hundred dollars for and establishing all the actionable facts.

the first five years and seven hundred dolEva v. Andersen, 166 Cal. 420, 137 Pac. 16.

lars for the remaining five years, which pro

vides for the indemnification of the lessors $ 2793.

"in the sum of three thousand six hundred 1. Guaranty-Sufficiency of.-A guaranty dollars, being for six months' rent at six is not defective because the names of the hundred dollars per month," obligates the guarantors do not appear in the body of the guarantor only in the payment of the rent instrument, where the name of the guarantee reserved for six months during the first five is contained therein and the names of the years of the lease not to exceed the sum guarantors are subscribed at the bottom, and of three thousand six hundred dollars at six hundred dollars per month, and does not tiff, if it so elected, to proceed against the cover any default of the lessees in payment guarantors directly and without first looking of the rent without regard to whether such to the principal debtor for the extinguishdefault occurred during the first five years, ment of the obligation and without seeking when the rent was fixed at six hundred dol- to recover satisfaction by resort to any collars per month, or during the second five lateral security which may have been pledged years, when the rent was fixed at seven hun- for its payment, and the words "at once" dred dollars per month.-Rosenthal v. Bauer, were clearly intended only to emphasize the 30 Cal. App. 277, 157 · Pac. 1137.

right intended to be vested by the instru

ment in the plaintiff to proceed against the 2807.

guarantors as independent obligors.-Union 1. Liability extinguished when.-The ex

Trust Co. v. Dickinson, 30 Cal. App. 91, 157 ecution by the school trustees in addition

Pac. 615. to such indorsement of a guaranty that the specified sum of money should be repaid

8 2814. to the assignee upon the completion of the 1. Continuing of guaranty-What is a.school building "out of the twenty-five per A contract of guaranty attached to a lease, cent of the contract price of said building, which guarantees to the lessors the payment held back until the completion of said build- of the rent specified in the lease at the times ing," does not make them guarantors of the and in the manner therein stated "up to the original obligation, and upon the abandon- amount of one thousand dollars," is a conment of the contract by the contractor their tinuing guaranty applicable to any delinliability is extinguished.-Lynip v. Alturas quency in the payment of rent, and is not School District, 29 Cal. App. 158, 155 Pac. satisfied upon payment of more than one 109.

thousand dollars of such rental.-Sinnige v. 2. An assignment by a contractor, en

Oswald, 170 Cal. 55, 148 Pac. 203. gaged in constructing a school building, of a specified sum of money "out of the twenty- 8 2823. five per cent of said contract price to be paid 1. Delay of creditor-Discharge of guarto me under said contract after the comple- antor.-Where the creditor grants the debtor tion and acceptance of the building,” op- an extension of time within which to pay, erates solely upon the fund to become due

under such circumstances as to impair or and payable only upon the completion of the to suspend his right to proceed against building, not upon moneys becoming due the debtor in accord with the terms of the and payable as the work progresses; and

original obligation there is such an alteraif the contractor abandons the contract be

tion of the original obligation as will release fore completion, the school trustees are not

the surety where it has been without his liable to the assignee for the amount of the consent.—Bridge v. Connecticut Mut. Life assignment, under their indorsement thereon

Ins. Co., 167 Cal. 774, 141 Pac. 375. recognizing the assignment and reciting an agreement to pay the sum named "out of

3 2836. the payment" to be made "at the time of

1. completion and acceptance of said building."

Surety not bound beyond contract.-In -Lynip v. Alturas School District, 29 Cal.

a suit against a surety the principal obligaApp. 158, 155 Pac. 109.

tion and its non payment must be clearly set

forth, because the surety's liability is only 3. -Right to recover, when lost. - The

conditional.-Stockton Sav. Bank v. McCown, right to recover on a guaranty, whereby

170 Cal. 600, 150 Pac. 985. the defendant jointly and severally guaran

2. The liability of a surety is not to be teed to the plaintiff unconditionally and at

extended, without his consent, beyond the all times the prompt payment of any and

precise terms of his contract.-Alexander v. all indebtedness not exceeding twenty thou

Bosworth, 26 Cal. App. 589, 147 Pac. 607. sand dollars which a certain person might

3. When a surety has shown that the at the time of the execution of the guaranty

contract as to which he became surety has or at any time thereafter owe to the plain

been changed, he has then shown that there tiff, is not lost by failure to bring the action

has been an attempt to make him liable on immediately upon the maturity of the note

a new and different contract; and the burden given to evidence the indebtedness, by rea

is then upon the other party to show that son of the provision of the guaranty giving

the surety has consented to the new contract. the guarantee the option, upon default of

--Alexander v. Bosworth, 26 Cal. App. 589, the debtor, to proceed directly and "at once"

147 Pac. 607. against the guarantors to collect the full

4. While it is elementary that sureties are amount of the liability without first proceed

never bound beyond the strict letter of their ing against the debtor, or foreclosing upon

contract, it is also elementary that a bond any collaterals held as security for such

given to guarantee the execution of a conindebtedness.-Union Trust Co. v. Dickinson,

tract according to its terms becomes a part 30 Cal. App. 91, 157 Pac. 615.

of such contract, and to that contract the

sureties become parties the same as though $ 2808.

they had actually made and executed the 1. Liability on guaranty of conditional contract themselves.-W. P. Fuller & Co. v. obligation.-Such provision of the guaranty Alturas School District, 28 Cal. App. 609, was merely intended to authorize the plain- 153 Pac, 743.