possession. Here we are concerned only with the nature of the right conferred by the law upon the owner to recover damages from a person who has committed an unauthorized act with respect to the property. We know that there are cases where the buyer is the owner of the property, but where the possession is still in the seller. The opportunity afforded the seller for committing a wrong with respect to the goods is present. He may refuse to surrender them when the law directs him to do so. In this case the buyer, by the above section, is entitled to enlist the aid of the court to recover possession of them. Such an action is often called an action of replevin. The seller may use the goods, damage them, or dispose of them, so that the buyer cannot locate them. In these cases the buyer may choose to recover damages to reimburse him for his wrong. The above section recognizes the existence of this right. Such an action is oftentimes called an action of trover, or of conversion, or of trover for conversion.

SECTION 8.—BUYER'S RIGHT OF SPECIFIC

PERFORMANCE

Sales Act, Section 68. Where the seller has broken a contract to deliver specific or ascertained goods, a court having the powers of a court of equity may, if it thinks fit, on the application of the buyer, by its judgment or decree direct that the contract shall be performed specifically, without giving the seller the option of retaining the goods on payment of damages, the judgment or decree may be unconditional, or upon such terms and conditions as to damages, payment of the price and otherwise, as the court may think just.

SOUTHERN IRON & EQUIPMENT CO. v. VAUGHAN. (Supreme Court of Alabama, 1918. 201 Ala. 356, 78 South. 212, L. R. A. 1918E, 594.)

Bill in equity by the Southern Iron & Equipment Company against W. H. Vaughan. Decree for defendant, and plaintiff appeals.

THOMAS, J. The suit, which was by appellant as complainant below, was to restrain appellee (respondent) from making disposition to others than complainant of certain railroad material alleged to have been theretofore purchased by complainant from respondent; and it is prayed in the bill that, upon final hearing, a decree be entered directing specific performance of the contract on the part of respondent. The bill does not aver the insolvency of the respondent. The court is sought to be given jurisdiction of such matter by the averment: “That the nature of the contract now existing between it and the respondent is such that by a breach thereof by the respondent your orator will have no complete and adequate remedy at law, and if such a breach thereof is permitted, it will suffer great and irreparable injury thereby. Your orator avers that the kind and character of rails sold by the respondent to your orator cannot be procured by your orator in the open

market, and, despite diligent efforts, your orator has not been able to procure them from any other source; that the market value of said rails cannot be ascertained; that if a breach of said contract is permitted, there will be no way to ascertain readily and completely and adequately the amount or extent to which your orator has been damaged.

* *

The general rules obtaining, for specific performance, are that: "Equity will not, in general, decree the specific performance of contracts concerning chattels, because their money value recovered as damages will enable the party to purchase others in the market of like kind and quality. Where, however, particular chattels have some special value to the owner, over and above any pecuniary estimate-pretium affectionis-and where they are unique, rare, and incapable of being reproduced by money damages, equity will decree a specific delivery of them to their owner, and the specific performance of contracts concerning them."

For example, paintings, statuary, an ancient horn which has gone along with plaintiff's estate (Pusey v. Pusey, 1 Vern. 273), an old silver patera dug up on plaintiff's estate (Duke of Somerset v. Cookson, 3 P. Wms. 389), a peculiar tobacco box belonging to a club (Fells v. Read, 3 Ves. 70), the dress and regalia of a Lodge of Free Masons (Loyd v. Loaring, 6 Ves. 373), family pictures (Lady Arundel v. Phipps, 10 Ves. 139), title deeds and valuable paintings (Lowther v. Lord Lowther, 13 Ves. 95), a finely carved cherry stone (Pearne v. Lisle, Amb. 75, 77), two very valuable jars (Falcke v. Gray, 4 Drew. 651), and a newspaper business, printing plant, and material used in said business (Williams v. Carpenter, 14 Colo. 477, 24 Pac. 558; Brady v. Yost, 6 Idaho, 273, 55 Pac. 542). *

* *

While complainant in the instant case does not aver the price at which it had resold the property in question to L. B. Foster Company of Pittsburgh, Pa., yet such sale is specifically averred, and the price thereof fixed by complainant is easy of ascertainment for submission to a jury for estimation of damages for a breach of the contract under the rules of law obtaining in such matters.

The further averment that "said Foster Company are demanding" fulfillment of their contract with complainant for said rails, and that if complainant does not secure said rails from respondent to make delivery of the same in accordance with its contract with said Foster Company, complainant will be unable to carry out its contract with that company, and will be "irreparably damaged," does not make a case of irreparable damage, that may not be fixed by a jury at law. * * * The contract, specific performance of which was sought in Black Diamond Co. v. Coal Co., 200 Ala. 276, 76 South. 42, was for the purchase and sale of coal, and required the defendant to sell to the plaintiff all of its output, to a stated daily average, for which the plaintiff was to pay monthly a stated amount per ton, etc., thus contemplating a continuous daily operation of the mine, requiring special skill, knowledge, and direction, over a period of months, and stipulating for a succession of acts that cannot be consummated by one transaction. The relief sought was denied.

Under the averments of the bill the act of delivery of the railroad material was to embrace a series of installments extending over the period from October 2 to November 2, 1917, necessitating the removal of such material from its present location along a right of way of 14 or

more miles in length, and delivery f. o. b. the cars at Perry's Mills, Ala. Thus the contract, by its terms, stipulated a succession of acts, to be continued through the reasonable period required, to move to and deliver at point of destination the property in question. If specific performance of such contract be required by the court, a more or less protracted supervision and direction would be necessary to consumate such removal and delivery as per contract stipulations. And it may be that on this ground the decree of the court should be sustained, but this is not decided.

However, we prefer to justify the ruling of the court in dismissing plaintiff's bill, on the ground that the insolvency of Vaughan is not alleged, and that compensation for the breach of the contract will give ful and complete redress, from the nature of the contract itself and the character of the subject-matter thereof. That is, by a verdict at law the complainant will obtain all that it was the object, by resale of the property in question, to obtain.

* * *

The result is unchanged by Lewman & Co. v. Ogden, 143 Ala. 351, 42 South. 102, 5 Ann. Cas. 265. There one of the parties had a contract with the United States for the erection of certain locks and dams on the Warrior and Tombigbee rivers, and sublet the contract to the other party under the written agreement to do the work by a designated time, and to furnish all necessary labor, teams, machinery, and appliances, etc.; and it was averred that said sublessee had ceased to work, and was attempting to remove such personal property necessary to the prosecution of the work, and to its completion "at the present season of the year, and at the present stage of the water." The bill, “in substance and in spirit" one for specific performance, was held to be without equity. The court said that specific performance might be decreed of a contract for the delivery of chattels, which no one but the defendant can supply, and which are necessary to enable the plaintiff to fulfill an engagement with a third party, "but not where the delivery of the chattels by the defendant was a mere question of convenience." It may be that where goods of special value have been sold, and there are no other similar goods in the market, a contract for the delivery of them would be specifically performed. * * *

The bill does not show that the complainant is not provided with a plain and adequate remedy at law for the breach of the contract by respondent Vaughan, but that a breach of such contract is fully measurable by a money standard. The present temporary economic condition, brought about by the pending war, does not bring the instant case within an exception to the general rules hereinabove adverted to.

The decree of the Montgomery circuit court in equity is affirmed.

*

Chapter

I.

II.

III.

IV.

V.

VI.

Introduction.

PART V
PARTNERSHIP

What Constitutes a Partnership.

Relations of the Partners Between Themselves.

Relations of Partners to Third Persons.

Causes of Dissolution.

Effect of Dissolution upon the Relations of the Partners Between
Themselves.

Effect of Dissolution upon the Relations of the Partners to Third
Parties.

VII. Limited Partnerships.

INTRODUCTION

The preceding portions of this volume, in the main, have dealt either with the general law of contracts or with the rules applicable to particular kinds of contracts. This is particularly true of Parts I, III, and IV. Part II dealt with the law of agency. To a great extent this topic also concerned the application of the principles of the law of contracts to a special relationship. The primary object of study was, however, this relationship and its consequences. It was necessary to draw upon the principles of the law of contracts to determine the nature and consequences of the relationship, but other departments of the law were also involved. And so with respect to the law of partnership. The object of study is the relationship.

A partnership is one form of business organization. It is one method by which two or more persons may combine their services and property for business purposes and for common ends. The relationship is usually created by contract, but this relationship is something separate and distinct from the contract which created it. A contract to enter into a partnership and an actual partnership are two different things. The law of partnership is concerned with the solution of the special problems which arise out of and because of the form of organization in which the business is carried on. As in other branches of the law, the first question to arise is: What groups or combinations of facts will create a partnership? Persons may intend to enter into a partnership, but fail to do so. Their acts may have created a different relationship. Conversely, persons may intend, not to enter into a partnership, but actually form one.

After determining what facts are sufficient to create a partnership, and what facts may or may not be present without affecting the existence of the relationship, the questions then arise as to the nature and extent of the legal consequences which follow the (1215)

B.& B.BUS. LAW

formation of a partnership. There are a great number of general and specific problems which arise naturally out of the situation. Prominent among them is the series of problems which, either directly or indirectly, arise out of the fact that the partners have combined their individual properties to be employed in a common enterprise. The law of property defines with considerable particularity the legal relations which one has with respect to property. But when two or more persons unite their properties, employ it for business purposes, exchange the original properties for other properties, accumulate surplus and sustain losses, a situation is created which makes it impracticable, if not impossible, to regard the original relation which each contributor to the capital originally possessed as still continuing. Each partner owns the property which he contributes to capital, but after the contributions have been made each partner's relations with respect to the property which he contributed necessarily have changed. Much of the law of partnership is concerned with the problem: What is the relation of an individual partner with respect to the property employed in the enterprise?

The ascertainment of the interest of each partner with respect to partnership property has a double aspect. It is necessary to determine what the relation is as between the partners themselves and as between the partners and third parties. If the capital of a partnership consists of land, buildings, machinery, and merchandise, is any particular machine owned by one partner just as it was before he employed it in the business? May he sell it otherwise than in the course of the partnership business? May a creditor of one of the partners, with respect to a debt not contracted in the course of the partnership business, seize the machine which was contributed to the working capital of the business? These are some of the detailed questions which involve the determination of the nature and extent of the interest of the individual partners in the partnership property.

Another question concerns the relations of firm creditors with respect to the individual members of the firm. If a firm creditor sues all the members of the firm, it logically follows that firm property is liable to seizure for satisfaction of the debt. But is it necessary that the firm creditor proceed against firm property? May the creditor sue an individual partner alone? If he sues all of the members of the firm, will he be permitted to take out execution against individual property of the partners? The relation of firm creditors and individual creditors with respect to property employed in the business and to the individual properties of each member constitute an important part of the law of partnership.

A partnership is a relation voluntarily entered into by the members. A great many changes in their relations, among themselves and as regards third parties, arise as a result of their joint undertaking. Whatever changes are thus worked, it is apparent that the new relations will not continue indefinitely. These new re