v. Buchanan, 1855, 17 D. 996. See, as to recall of interdict, Dundee Gas Light Co. v. Dundee New Gas Light Co., 1844, 7 D. 109. As to breach of interdict, Fleming v. Caled. Ra. Co., 1847, 9 D. 792; Hamilton v. Caled. Ra. Co., 1847, 10 D. 41; revd. in part, 1850, 7 Bell's App. 272, 22 Jur. 622.

CHAPTER VIII.

JUDICIAL FACTOR (a).

the Court of

Session.

THE Court of Session being in Scotland the Supreme Court of Appointed by Law and Equity, and coming in the place of the old Scottish Privy Council, has long been in use to appoint judicial factors for the management and administration of estates subject to litigation, or not protected by any one legally entitled to their management. Anciently, it should seem, sequestration of the estate was in all cases required as a preliminary to the appointment; but though this has been relaxed in modern practice, it would still appear that this is the proper course of procedure in the case of corporations or copartneries (b).

in England.

In England, judicial factors are termed receivers, or receivers and How termed managers, according to the nature of their powers and duties (c); and even in Scotland they have received this appellation (d).

The appointment of a judicial factor on the estate of a firm or Principles of appointment; company, involves a much greater interference with the company affairs than the mere granting of interdict against certain proceedings complained of; for it takes the management entirely out of the hands of the partners or shareholders, and thus operates as an interdict against their interfering in any way with the company affairs. The Court are therefore very chary in making such appointments, and will not do so unless a very strong case for such interference is made out.

(a) Upon this subject generally, see Thoms on Judicial Factors.

(b) Beck, 1836, 14 S. 1056; Dixon, 1832, 10 S. 209; Morrison, 1857, 20 D. 276; Glasgow v. Barrhead Ra. Co., 1850, 12 D. 1014.

(c) Bennet's Receiver, ch. ii. s. 2; Daniell's Chancery Practice, 3d ed., 978.

(d) Duke of Roxburgh, 1824, 2 Shaw's App. 18.

in private firms, winding up.

Misconduct,

etc.

Generally speaking, the Court will not appoint a judicial factor to manage the affairs of a private partnership, unless the application is made for the purpose of winding up the concern. The reason of this is, that it would serve no good purpose to perpetuate the existence of a concern which its own partners were unable to manage, and that no limit could well be set to the duration of the appointment (a).

When the concern has not already been dissolved, misconduct on the part of some of the partners is the most common ground on which the appointment of a judicial factor is sought; but if, apart from the alleged wrong-doers, there still remain a sufficient number of partners to manage the concern, the Court will not in general make such an appointment, the proper remedy being by interdict. Hence it is much more difficult to obtain the appointment of a judicial factor where the membership is numerous, than where it consists of only two partners (6). It is presumed that when men enter into a partnership, they have full confidence in each other's honesty; and therefore it is not mere squabbling or every piece of apparent misconduct that can be taken as sufficient to warrant the Court to take the management of the concern out of the hands of the partners, and thus break up the original agreement (c). When, however, it is plain from the conduct of some of the partners that all confidence is forfeited, a judicial factor will be appointed with the view of winding up the concern. The most common examples of such conduct as is here referred to are the following: Where an attempt is made to exclude a partner from his share of the management, by alleging that he is not a member of the concern, or has no interest in the company property (d); where a partner is applying the company property for carrying on a business of his own, or making away with it for unexplained purposes; when he colludes with the company debtors, so as to enable them to escape or delay payment of the company claims; and when,

(a) Goodman v. Whitcombe, 1 Jac. and W. 589; Hall v. Hall, 3 Mac. and G. 79; Waters v. Taylor, 15 Ves. 10; Harrison v. Armitage, 4 Madd. 143; Oliver v. Hamilton, 2 Anstr. 453.

(b) Hall v. Hall, supra.

(c) Rowe v. Wood, 2 J. and W. 556; Roberts v. Eberhardt, Kay 148.

(d) Peacock v. Peacock, 16 Ves. 49; Goodman v. Whitcombe, 1 J. and W. 589; Blakeney v. Dufaur, 15 Beav. 40; Wilson v. Greenwood, 1 Swanst. 481.

in such cases, the misconduct complained of and established cannot be remedied by interdict (a).

When the partnership property, or the interests of the partners Mutual litigation. therein, has become the subject of mutual litigation, as e.g. where one partner has brought an action of reduction of the contract of copartnery, a judicial factor may be appointed pendente processu (b). When, in an action by one partner against another, the defence is taken, that the alleged partnership is illegal, it has been doubted whether the Court will appoint a judicial factor, unless the application has been made in initio litis (c). Where a partnership is sought to be judicially established, a factor may be appointed if the case has gone far enough to create a probabilis causa (d).

When a partnership is dissolved by the death of one of the Death. partners, it survives for the purposes of winding up in the surviving partners; and the representatives of the deceased partners are not entitled to have a judicial factor appointed, unless they can make out neglect or improper conduct (e).

But though the Court will not without special reasons appoint a judicial factor while one of the partners is in a position to continue the management, the case is very different where the company estate has come under the control of persons other than the partners. When, therefore, all the partners are dead, and their representatives are in possession, a factor will generally be appointed as a matter of course (f). The fact that the last surviving partner had appointed trustees for winding up the concern is no reason why the representatives of the other partners should not obtain the appointment of a judicial factor; for though a surviving partner is entitled to wind up the affairs of the company himself, he has no

(a) Madgwick v. Wimble, 6 Beav. 495; Evans v. Coventry, 5 De G. Mac. and G. 911; Sheppard v. Oxenford, 1 K. and J. 491; Harding v. Glover, 18 Ves. 281.

(b) Ex parte Broome, 1 Rose 69; but see Macdougall v. MacLaurin, 1839, 1 D. 1241; Drysdale v. Lawson, 1842, 4 D. 1061.

(c) Sheppard v. Oxenford, 1 K. and J. 491; Hale v. Hale, 4 Beav. 369.

(d) Fairburn v. Pearson, 2 Mac. and G. 144; Chapman v. Beach, 1 J. and W. 594.

(e) Collins v. Young, 1853, 1 Macq. 385, reversing 14 D. 540; Harding v. Glover, 18 Ves. 281; Lawson v. Morgan, 1 Price 303; Kershaw v. Matthews, 2 Russ. 62; Kennedy v. Lee, 3 Mer. 448.

(f) Phillips v. Atkinson, 2 Bro. C. C. 272.

Special instances.

Powers of judicial factor in private firms.

implied power to entrust this to others, so as to bind the representatives of his former partners (a). For a like reason, an appointment of a judicial factor will easily be obtained by a partner against the representatives of his late copartner by succession or in bankruptcy (b). Even where the partners on dissolution have agreed to appoint a stranger to wind up the concern, and to refrain from interference themselves, this does not always preclude the appointment of a judicial factor. Thus, when an agreement of this kind had been made and had been partially carried out, but on the death of one of the partners disputes arose between his representatives and the surviving partner who sought to interfere in the management, the Court of Chancery appointed a receiver on a bill filed by the executors of the deceased partners (c).

When, on a dissolution, no extrajudicial arrangement between the quondam partners for winding up the concern could be agreed upon, and there was no provision on the subject in the contract of copartnery, the Court, on the application of one partner with consent of the others, appointed a judicial factor (d). And in one very special case of a joint adventure, a judicial factor was appointed of consent of both the adventurers, with the unusual powers of taking all steps necessary for the protection of the interests of the adventure, and either to wind up and sell the property or to carry on the business. This case, however, cannot be taken as a precedent (e). The partner of a dissolved firm, while in prison on a charge of forgery, of which he was afterwards convicted, granted a trust-assignation and a factory in favour of a certain party, for the purpose of collecting the debts and winding up the concern. The Court superseded the appointment, but nominated the same party to be judicial factor (ƒ).

As to the powers of judicial factors appointed on unincorporated associations, the following cases may be noticed: Where a judicial factor had been appointed on the estates of a solvent mercantile company, after the death of the last partner, to manage and wind

(a) Dixon v. Dixon, 1831, 10 S. 178; Fullarton v. Dixon, 1834, 12 S. 750.

(b) Freeland v. Stansfeld, 2 Sm. and G. 479; Candler v. Candler, Jac. 225; Fraser v. Kershaw, 2 K. and J. 496.

(c) Davis v. Amer, 3 Drew. 64. (d) Abercrombie, 1857, Thoms on Jud. Fact. 42.

(e) Bell, 1857, 19 D. 704.

(f) Marshall v. Anderson, 1841, S

D. 989.