ment; and that fraud shall be presumed, unless the express authority of the one partner, thus to apply the partnership property in liquidation of his separate demand, be established. This doctrine appears to be confirmed by the recent case of Heath v. Sansom (c); in which the Court held that, under such circumstances, even an indorse of a bill or note, thus given in fraud of a firm, cannot sue the firm thereon, without proving that he took the bill for value, although no notice had been given him to move the consideration. But in the case of Ridley and another v. Taylor (d), though the plaintiffs, the separate creditors of one partner, took the joint security of the firm without consulting all its members, the Court would not infer fraud. In that case the bill appeared, on the face of it, to have been drawn in the name of the firm, for a larger amount than the particular debt, payable to their own order, eighteen days before the delivery of it to the separate creditors, and to have been accepted and indorsed before such delivery. And, though the indorsement was in fact made by the hand of the debtor partner, yet it did not appear that that fact was known to the separate creditors at the time; which the Court much relied upon, as direct evidence might have been given of the covin, or want of authority, if it existed. Under the whole of the circumstances of that case, the Court thought there did not appear that there was any such crassa negligentia on the part of the plaintiffs, in not inquiring whether the partner, with whom they dealt, was authorised to dispose of the security, (which had originally been partnership property,) as his own, as to render the transaction on that account fraudulent, and therefore void.

If a bill, accepted in a partnership firm, be applied, with the knowledge of the party who takes the bill, in part only, to the separate use of the partner who actually accepts it, a secret partner, not known to the individual who receives the bill, is liable in respect of so much of the amount as is not, to the knowledge of the taker, applied to the separate use of the partner who accepts the bill (e).

Where A. and B. agreed to take a farm, and pay C., a former occupier, for certain articles, by bills drawn at three months; and C. afterwards, without the knowledge or consent of A., took from

(c) 2 B. & Ad. 291.

(d) 13 East, 175.

316.

(e) Wintle v. Crowther, 1 C. & P.

B. bills for the amount, payable at six and twelve months, accepted by himself in his own name and A.'s; it was held that the latter could not be sued on the bills (ƒ). The Court considered that B. had not, under such circumstances, sufficient authority to bind A.

It was agreed between the plaintiffs, and one of the defendants, proprietors of a stage-coach, to carry certain parcels for the plaintiff free of expense, which were accordingly carried for two years, but there was no evidence of any knowledge of this agreement by the other defendants; and the defendants had given notice that they would not be accountable for parcels above the value of 5l., unless entered and paid for, &c.; it was held that the defendants were not liable for the loss of a parcel above the value of 57., sent by the plaintiff under the agreement. No notice of the value of the parcel had been given to the defendants. The Court considered the agreement with one of the firm as a fraud on the other partners, and made for the individual benefit of the plaintiff (g).

Although no fraud exist, and the transaction is purely of a partnership nature, the act or contract of one partner does not bind the firm, if the creditor received a previous express warning from the other partners, that they would not consider themselves responsible (h). The authority of one partner to bind the firm is only implied; and no one can become the creditor of another against his express and declared will.

There have been some decisions in regard to the liability of partners for money actually advanced to one partner, but applied to partnership purposes. It seems that if a partner solely borrow a sum of money, and give his own security for it, it does not become a partnership debt, by being applied for partnership purposes, even with the knowledge of the other partner (i). In Smith v. Craven (k), it appeared that A., B., and C., not being

(f) Greenslade v. Dower, 7 B. & C.

635.

(9) Bignold v. Waterhouse, 1 M. & Selw. 255.

(h) v. Layfield, 1 Salk, 292; Gallway v. Matthew, 10 East, 264; Willis v. Dyson, 1 Stark. R. 164; Vice v. Fleming, 1 Y. & J. 227.

A subsequent act of adoption or recognition might render the party liable. Willis v. Dyson. See Ante, 203.

(i) Beavan v. Lewis, 1 Sim. 376; Loyd v. Freshfield, 2 C. & P. 325; Vere v. Ashby, 10 B. & C. 288. (k) 1 C. & J. 500.

general partners, entered into a joint speculation, and each was to contribute a third; it was held, that A., who had paid his share, was not liable to the bankers of B. for monies advanced by such bankers, on the individual credit of B., with the knowledge of A., though such monies were applied in payment of bills drawn upon B. in the course of the joint speculation. And where one of two partners drew bills of exchange in his own name, which he procured to be discounted with a banker, through the medium of the same agent, who procured the discount of other bills, drawn in the partnership firm with the same banker; it was held, that the latter had no remedy against the partnership, either upon the bills so drawn by the single partner, or for money had and received through the medium of such bills, although the proceeds were carried to the partnership account; the money being advanced solely on the security of the parties, whose names were on the bills, by way of discount, and not by way of loan to the partnership, although the bankers conceived at the time that all the bills were drawn on the partnership account (1). But where one of several partners, with the privity, and by the authority of the others, drew bills of exchange, in his own name, upon the partnership firm, in favour of persons who advanced the amount, which he applied to the use of the partnership; Lord Ellenborough, C. J., held at Nisi Prius, that although the partners were not jointly liable on the bills, they might be jointly sued by the payees for money lent, the transaction being a loan rather than a discount (m).

Although the firm may be liable to the lender of money, advanced to one partner for the partnership purposes, on the credit of the firm; yet if the loan be made to one partner, under circumstances of negligence, and out of the ordinary course of business, and the money be misapplied, the other partners, not being privy to the advance, will not be liable, although the partner who received the money said at the time, that he borrowed it for the firm (n).

In regard to contracts of a personal nature with a firm, as a contract with coachmakers to hire of them a carriage for a certain

(1) Emly v. Lye, 15 East, 7; see Ex parte Bolitho, Buck. 1100.

(m) Denton v. Robie, 3 Camp. 493; observed upon by Mr. Baron Bayley,

in Smith v. Craven, 1 C. & J. 507; Ex parte Bolitho, Buck, 1100.

(n) Loyd v. Freshfield, 2 C. & P. 325.

term, it seems that the firm cannot, by dissolving the firm and receiving a new partner, and transferring the carriage and the interest of one of the partners in the contract to another person, vest in him a right of action on such contract (p).

3rd. Of the Dissolution of a Partnership, and of Contracts subsequently made.

A partnership may be dissolved (q); 1st, by the act of the parties, as by their mutual consent; or where no specific period is limited for the continuance of the partnership, either party may dissolve it instantly (r): 2ndly, by the act of God, as by the death (s) of one of the partners: 3rdly, by act of law, as where the partnership is formed to effect a particular object, which is found to be impracticable, and wholly fails (t); or where one of the partners becomes a bankrupt (u).

But in order to render the dissolution of a partnership effectual, as regards the public, it is in general necessary that notice should be given thereof in the Gazette (x). And if a partner retire, without notice being given in the Gazette, and the name of the firm is still preserved, a person dealing with the firm after the dissolution, may still call upon all the original parties, unless he had notice, or knew, that one of them had retired (y). And even where an infant held himself out as being in partnership with T. S, and

(p) Robson v. Drummond, 2 B. & Ad. 303.

(9) See 1 Montagu on Partnership, 86, part iii. c. 1; French Code Civil, book 3, tit. 9, c. 3.

(r) Master v. Kirton, 3 Ves. 74; Tattersall v. Groote, 2 B. & P. 131; Peacock v. Peacock, 16 Ves. 49; Featherstonhaugh v.Fenwick, 17 id., 298; Crawshay v. Maule, 1 Swanst. 508, per Lord Eldon, C.; see Littlewood v. Caldwell, 11 Price, 48; Heath v. Sansom, 1 Nev. & M. 104; 4 B. & Ad.173, S. C.

(s) Pearce v. Chamberlain, 2 Ves. 33; Crawshay v. Maule, 1 Swanst. 508; per Eldon, C.-" Although a partnership is entered into for a term of years, it is previously dissolved by the death of either of the partners, unless there be an express stipulation to the contrary;" Crawford v. Hamilton, 3 Madd. 251. As to the effect of such stipulation, if nominee of deceased partner will not act, &c., Reg

shaw v. Matthews, 2 Russ. 62. It may be doubtful whether even decided and settled lunacy, ipso facto dissolves the partnership; but it seems that, under circumstances, it would form a ground for a decree in equity for a dissolution. See Sayer v. Burnett, Wats. on P., 382; 1 Montagu on P., 16 n; and the cases cited in the note to Crawshay v. Maule, 1 Swanst. 514.

(t) Baring v. Dix, 1 Montag. Partnership, 90, note (h); Nockles v. Crosby, 3 B. & C. 814; 5 D. & R. 751, S. C.

(u)Hayne v. Rolleston, Burr. 2174; Fox v. Hanbury, Cowp. 447; Ex parte Ruffin, 6 Ves. 126; Smith v. Stokes, 1 East, 364; Thomason v. Frere, 10 id., 418; Harvey v. Crickett, 5 M. & Selw. 336, 340.

(x) Gorham v. Thompson, Peake's R. 42; Godfrey v. Turnbull, 1 Esp. R. 371.

(y) Parkin v. Carruthers, 3 Esp. R.

248.

P

continued to act as such till within a short period of his coming of age, but there was no proof of his doing any act as a partner after that period; it was held that it was his duty to notify his disaffirmance of the partnership on arriving at the age of twentyone, and as he had neglected to do so, that he was responsible to persons who had trusted T. S. with goods subsequently to the infant's attaining twenty-one, on the credit of the partnership (z). A public notice will, however, be sufficient to exonerate a retiring partner from the responsibility on contracts entered into by the firm after such dissolution, with persons who had not previously transacted business with it; even though such persons were ignorant of the dissolution, and the remaining partners carry on the concern under the style of the old firm, without the consent of the former partner (a). And it appears that a partner who has never been known to be such, that is, a dormant partner, need give no notice whatever of his retirement, to discharge himself from responsibility to persons who, being ignorant that he was once a partner, subsequently contract with the firm (6).

It is however clear, that an express and particular notice of the dissolution must be given, or actual knowledge thereof proved, to discharge a retiring partner from future responsibility to persons who, before the dissolution, trusted and dealt with all the partners (c).

A change of partners in a banking-house is generally notified by a circular letter to the customers; but it seems that a change of names in the printed cheques of the house is sufficient notice of the dissolution of the partnership, to those customers who have drawn cheques addressed to the new firm (d). And where a person sued, as a partner, for the value of goods furnished for "the owners" of a ship, was neither a partner in fact at the time, (having parted with his share some time before); nor held himself out as such, having before withdrawn his name from the description of the firm at the counting-house, and sent circular letters to the correspondents of the house, notifying the change; it was decided, that he should not be charged, merely because having effectually conveyed his whole share in the ship

(z) Goode v. Harrison, 5 B. & Ald. 147; ante, 125.

(a) Newsome v. Coles, 2 Camp. 617. (b) Heath v. Sansom, 1 N. & M. 104; 4 B. & Ad. 172, S. C.; ante, 195.

(c) Graham v. Hope, Peake's R. 154; Chitty on Bills, 8th ed. 62. See Dolman v. Orchard, 2 C. & P. 104. (d) Barfoot v. Goodall, 3 Camp. 147.