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net profits whatever be their private agreement.

there is a joint and mutual interest in the profits and losses, or a participation in the clear profits of the concern. So an agreement between two or more persons, having separate business concerns, to share in certain portions the profits of their respective concerns, would constitute a partnership as towards third persons, though it may have been provided by the agreement that none of the contracting parties shall be accountable for the acts or losses of the other, but each party for his own. A person holding himself out as a partner, so as to induce others to give credit on that assurance, would be liable as such, Participation though he may have no interest in the concern (a). But a

Holding oneself out as a partner.

of profit as dormant partner.

Executors carrying on trade

become

partners.

person would be liable as a partner if he participates in the profits and loss, though his name has never appeared (b).

When the executors of a deceased partner carry on trade for the benefit of the estate they become liable personally as copartners, though they have acted in their official capacity (c). Creditors car So where creditors agree together to carry on the business of rying on the the bankrupt estate for their joint benefit, and divide the net come partners. income of the business in rateable proportions among all the creditors, according to the amount of their respective debts, they would be liable as partners towards third persons (d).

business be

No partnership without intention or right to account.

Nor by remuneration as gross earnings.

Nor by a per

centage of

gross amount.

No contract of partnership would exist as between the parties themselves or towards third persons where either of them receives a portion of the profits in lieu of, or in addition to, his wages of labour, or as a reward for services or skill as agent, clerk, or foreman, provided there has been no intention to contract partnership, nor any right has accrued to account, nor any property in the capital stock (e). So when a lighterman agreed to receive for his work as his remuneration half the gross earnings of the lighter, that did not constitute a partnership (f). So the receipt of a percentage upon the gross amount of sales made to certain customers by the person who recommended such customers did not constitute him a partner as against

(a) Goode v. Hairrson, 5 B. & Ald. 147; Bonsfield a. Smith, 12 M. & W. 405; Waugh v. Carver, 2 H. Bl. 235; Hoare v. Dawes, 1 Doug. 371; Guidon v. Robson, 2 Camp. 302; Godfrey v. Turnbull, 1 Esp. 371; Stables v. Eley, 1 C. & P. 614; Baird v. Planque, 1 F. & F. 344.

(b) Lloyd v. Archbowle, 2 Taunt. 324; Ruppell v. Roberts, 4 Nev. & M. 31; Drake v. Bekham, 11 M. &W. 315. (c) Wightman v. Townroe, 1 M. &S.412. (d) Hickman v. Cox, 3 C. B.N.S. 523. (e) Hesketh v. Blanchard, 4 East, 144; Dry v. Boswell, 1 Camp. 329.

(f) Dry v. Boswell, 1 Camp. 330.

Nor by the mere sharing of profit with

out interest.

In whaling

voyages.

In oyster

fisheries.

third persons (a). So seamen engaging on a whaling voyage, and receiving a certain proportion of the profits of the voyage in lieu of wages, were not thereby held as partners in the adventure (b). So persons engaged as dredgers in the oyster fisheries, having no interest in the boats nor in the fish caught, but merely receiving a share of the profits in lieu of wages, were not held as partners (c). So the captain of a coal barge, employed to carry out and sell In collieries. coal on a remuneration for his services of two-thirds of the price for which he sold the coals, after deducting the price charged at the colliery and the wages and pay of the crew, was not held to be a partner (d). So where a surgeon, in consideration for the Agreement assignment of the practice and of his being introduced to the geons. patients, agreed to allow to the retiring surgeon one moiety of the clear profits of the business, to be paid yearly, it was held that the stipulation as to profits did not create a partnership between the parties (e).

among sur

Broker re

ceiving portion of profits

as remunera

Where, however, there is an agreement to divide profits and loss as principals, there is partnership (f). So a broker employed Illustrations. to purchase goods under an agreement to receive a proportion of the profits arising from the sale, and to bear a proportion of the loss, was held as a partner towards third persons (g). So tion, Agent receivwhere a person joins another in the furtherance of an under- ing remunerataking, and contributes his work and labour towards the attain- tiondependent on profit. ment of the object, on the condition that the remuneration is to depend on the realisation of the profit, he would be held to be a partner (). So where one agreed with another to convey by horse and cart the mail at a certain price per annum, and to pay his proportion of the expense of the cart, the money received for the carriage of parcels to be divided between the parties, and the damage occasioned by loss of parcels to be borne in equal portions, the agreement was held to constitute partnership (). So where a party advance money

(a) Pott v. Eyton, 3 M. G. & Scott, 32; Stocker v. Brockelbank, 3 Mac. & G. 250; Andrews v. Pugh, 24 L. J. Ch. 58.

(b) Wilkinson v. Frasier, 4 Esp. 18; Rice v. Austin, 17 Mass. 197; Mair v. Glennie, 4 M. & S. 240.

(c) Perrott v. Bryant, 2 Y. & Col. 61.

(d) Hartley's case, Russ, & Ry. 141.

(e) Rawlinson v. Clarke, 15 M. & W. 292.

(f) French v. Styrling, 2 C. B. N. S.

357.

(g) Smith v. Watson, 3 D. & R. 751 ;
Meyer v. Sharpe, 5 Taunt. 74; Ex
parte Langdale, 18 Ves. 300.

(h) Addison on Contracts, p. 722.
(i) Green v. Beesley, 2 Bing. N. C.
108; Barry v. Nesham, 3 C. B. 641.

Labour to be

remunerated

by participation of profit.

Lending

money on con

dition of an

interest in the profit.

Retiring partner leaving money to participate

in the profits.

Partnership by allowing name to be

used as part

ner.

to another to assist him to prosecute an adventure, on an agreement that he is to receive half of the profits of the adventure, he was held as a partner towards third persons; and an agreement that he should be indemnified against loss did not make him less a partner (a).

A partnership would also be held to exist where a retired partner leaves money in the concern at a rate of profit, or at an annuity which rises and falls in proportion to the greater or less amount of profits (b).

A partnership would be held to exist as regards third persons wherever the name of a real person is inserted in the firm with his own consent, or where the same is used in bills of parcels or invoices, or is allowed to remain over the door, although the party may have contracted that he should suffer no loss (c). If, voured to pre- however, he has used every precaution to prevent such use of his own name he will not be liable, even though he has not sought to obtain an injunction (d),

Not if the

party endea

vent the use.

There is no partnership without the intention to unite.

What will constitute a partnership.

FOREIGN LAWS.

France. In no case is there partnership where there is no will to unite. Neither joint ownership of property, nor community of interest in profit and loss, is able of itself to produce partnership, unless there is the intention to enter in such a contract. Thus a clerk receiving a share of the profit instead of a fixed salary would not be held to be a partner. He would have no right over the partnership property, nor be liable for the partnership debts. So, where a person entrusts to another certain articles on sale, giving him the whole or a part of the proceeds in excess of a certain price, there would be no partnership. So a contract of bottomry bond, where both the lender and the borrower acquire a community of interest in the safety of the ship, does not constitute partnership (e).

United States of America.-To constitute a partnership the person must be received into the association as a merchant, and

(a) Coope v. Eyre, 1 H. Bl. 37 ; Bond v. Pittard, 3 M. & W. 357; Geddes v. Wallace, 2 Bligh, 270.

(b) Elgie v. Webster, 5 M. & W.

518;
Grace v. Smith, 2 W. Bl. 1000;
Ex parte Chuck, 1 M. & Scott, 616.

(c) Williams v. Keats, 2 Stark. 290;

Ex parte Watson, 19 Ves. 458; Fox v. Clifton, 9 Bing. 116.

(d) Newsome v. Coles, 2 Camp. 617. (e) Pardessus, Droit Commercial, vol. ii. 560, 563, 702, 969; Duvergier, Droit Civil Franc., tom. v. 48-56.

not as an agent, and his interest in the profits must not be intended as a mere substitute for a commission or in lieu of brokerage, So the allowance to a clerk or agent of a portion of the profits of sales as a compensation for labour, or a factor a percentage of the amount of sales, does not render the agent or factor a partner, when it appears to be intended merely as a mode of payment adopted to increase and secure exertion, and when it is not understood to be an interest in the profits in the character of profits, and there is no mutuality between the parties, Shipments from America to India, upon half profits, have never ⚫ been considered to involve the responsibility of partners, unless it flows from special agreements. The test of partnership is a community of profits, a specific interest in the profits, as profits, in contradistinction to a stipulated portion of the profits as a compensation for services. There is a distinction between a stipulation for a compensation for labour proportioned to the profits, without any lien upon such profits, and which does not make a person a partner, and a stipulation for an interest in such profits, which entitles the party to an account as a partner (a).

partners.

Spain.-Agents who, instead of a salary, receive a share in Agents are not the profits are not partners; and when they have received such shares in due time, and not in anticipation, they cannot be called to restore any sum (b).

SECTION V.

COMMENCEMENT AND DURATION OF THE PARTNERSHIP.

BRITISH LAW.

Where no time is fixed for its commencement, the partnership is held to have commencement on the date of the agreement (c). But where the partnership has commenced prior to that date, the time of the execution of the deed is immaterial (d).

(a) Kent's Comm., vol. iii. p. 22, 32; Muzzy v. Whitney, 10 Johns. R. 226; Rice v. Austin, 17 Mass. 206; Story on Partnerships, pp. 60-75. (b) Spanish Code, § 269.

(c) Williams v. Jones, 5 B. & C. 108;

(d) Battley v. Bailey, 1 Scott, N. R. 143.

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How long it is presumed to exist.

term and at

A partnership once shown to exist would be presumed to continue till it is proved to have been dissolved (a). A partnership If no terms are specified,

A partnership continued

Partnership at may be for a specific time or at will. the partnership is held to be at will. after the specific time has elapsed is treated as a partnership at will.

will. When term has elapsed.

May be for one adventure.

May be limited to one object.

A partnership may be formed for one particular adventure, or for a continuous course of transactions without making the parties partners in any other business.

A partnership may be limited to any particular object, as to the working of a particular patent or to operations to be carried on at some particular place (b).

Who may be partner.

Minor may be for his benefit.

His duty on attaining his majority.

Married

woman may be if held as feme sole.

SECTION VI.

WHO MAY BE PARTNER.

BRITISH LAW,

Any person of age and of sound mind may be a partner, unless otherwise disqualified by law.

A minor may be a partner for his own benefit, but he would not be liable for contracts entered into during his minority (c). On his attaining the age of majority, a minor may elect if he will continue that partnership or not. If he continues the partnership, he will then be liable as a partner; if he dissolve the partnership, and gives due notice to that effect within a reasonable time before or after he has become of age, he will cease to be a partner; and if he had derived no advantage or benefit he may recover any money paid by him for the partnership (d). A married woman may be a partner whenever she has capacity to trade, and is recognised at law as a feme sole (e).

(a) Clark v. Alexander, 8 Scott, N. R. 161.

(b) De Berkom v. Smith, 1 Esp. 29; Heyhoe v. Burge, 9 C. B. 431; Redgway v. Philip, 1 C. M. R. 415.

(c) Corpe v. Overton, 10 Bing. 252; Holmes v. Blogg, 8 Taunt. 508; Goode v. Harrison, 5 B. & Ald. 157.

(d) Goode v. Harrison, 5 B. & Ald. 157; Warwick v. Bruce, 2 M. & S. 205; Corpe v. Overton, 10 Bing. 253.

(e) Ex parte Franks, 7 Bing. 762; 20 & 21 Vict. c. 85; Derry v. Mazarine, 1 Lord Raym. 147; Bardon v. Keverberg, 2 M. & W. 61.

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