wished him to finish the transaction, for they were wholly ignorant of mining concerns. They afterward met at the Royal Hotel for the purpose of concluding the transaction. Some difference arose with respect to the terms of the agreement as to whether it should be an assignment or an underlease; and Mr. Shand and Mr. Fawcett were willing so far to depart from the original arrangement as to agree that it should be an underlease, which Mr. Whitehouse at first objected to; but he afterward acquiesced in the alteration. As soon as the terms of this agreement were arranged, the defendant called three of the partners of the house of Knight & Co. out of the room, for the purpose of settling with them the terms of his own private agreement. The agreement as drawn by Mr. Fellowes, was handed to them. They objected to it as a departure from their original intention which was, as it was stated, that the £12,000 should be a loan, whereas it was now made an absolute gift. In consequence of the demur, some further negotiation ensued between the defendant and those members of the firm of Knight & Co. who were then present. On this point, the representation made by Whitehouse is material. He said, "I have procured you persons of respectability as partners in this concern; you run no risk; there is no chance whatever of the works being again thrown upon your hands; you ought, therefore, to release me from the bond, and not allow it to hang over my head." They acquiesced in these reasons.

The stipulation relative to the bond was omitted, and the agreement was signed, with some alterations, as drawn by Mr. Fellowes. It was then delivered into the hands of young Mr. Fellowes, in order that he might get it stamped; and at that time the defendant stated his desire that he would show it to no living soul; and he at the time represented over and over again to Mr. Fellowes that he would not sign the other agreement until this, his particular and personal agreement, had been previously executed. Such are the facts of the case; and the first observation that occurs is, that in this transaction Mr. W. was negotiating for himself and his future partners as an agent for the intended partnership. That he was acting as their agent, the circumstances of the transaction show beyond the possibility of doubt. It is sworn to in express

and distinct terms by Mr. Hancock and Mr. Wilkinson, and it is evidenced by the conversation already referred to, which passed at the Swan Inn. It is said on the other side, that he could not be considered as absolutely the agent in the negotiation, but that Messrs. Fawcett and Shand acted for themselves in the manner which they thought most calculated to promote their own interest. Mr. Shand went himself to inspect the works, and he employed a friend, Mr. Wilkinson, for the purpose of accompanying him in his survey: they did not, therefore, absolutely rely on the representations of Mr. Whitehouse, but chose to have recourse to an agent of their own, in order to ascertain how far his statements were correct. Undoubtedly that is the fact; they did not trust implicitly to the representations made by Mr. Whitehouse, with respect to the property and the nature of the works, and they deemed it prudent to apply to another person for the purpose of learning whether those representations were true. But Mr. Wilkinson had nothing whatever to do with the treaty; the treaty was exclusively managed by Mr. Whitehouse. It is said, also, that at the meeting at which the transaction was finally completed, the terms originally stipulated for by Mr. Whitehouse were departed from—and they certainly were departed from in one particular, in the adoption of an underlease instead of an assignment; and in that alteration Messrs. Shand and Fawcett unquestionably acted for themselves, and Mr. Whitehouse acquiesced in it. But that does not in the least do away with the effect of this, that in all the arrangements with respect to the pecuniary terms and conditions, the business was conducted entirely by Mr. Whitehouse, acting on behalf of Messrs. Fawcett and Shand. If, therefore, Mr. Whitehouse was placed in the situation of being the agent of two other persons, while he was acting also for himself, and he stipulated for a private advantage which was to be kept secret, and in which his copartners were not to share, it is quite impossible for this court to sanction such a transaction; and the question, therefore, resolves itself into this: What was the effect of the private stipulation and what the nature of the private advantage? We are not to be misled by terms; we must consider what the transaction really was. It is said this was a loan of £12,000, in order to enable Mr. VOL. XI-17

Whitehouse to bring his capital into the concern.

But it was not a loan properly so called; it was £12,000 advanced without interest, and to be repaid only in a certain event; being, in effect, a gift upon condition, liable to be defeated if the covenants in the other and principal agreement were not duly complied with, and being intended to secure the due performance of them. That such was the nature of the transaction is evidenced by the subsequent conduct of the parties, because the moment the partners were known, the moment it was seen that no risk was to be run, that representation was made by Mr. Whitehouse to the other parties: "You are perfectly secure; these are persons of responsibility and character; there is no danger of the works being again thrown on your hands, and, therefore, there is no reason why this bond should be allowed to hang over my head;" upon which they consented to withdraw the stipulation relative to the bond, and converted that which before was a conditional into an absolute gift. But whether it was conditional or absolute does not vary the nature or substance of the case. If it was a conditional gift, still it was a benefit to this party, who was one of the three individuals who entered into the partnership and who himself negotiated the terms of it. It is impossible for this court to sanction such a proceeding. When three persons are engaged in negotiating a partnership, and the negotiation is conducted by one as the agent of the other two, he should not, in my opinion, be allowed to make a private advantage for himself. That he felt it was an improper proceeding is proved by his anxiety to keep it secret from his partners; and it was not till after a considerable time had elapsed that it came to light. It appears to me, therefore, upon these grounds, that the decision of the vice-chancellor was correct; and that as to two thirds of the sum of £12,000 the defendant must be considered a trustee for the partnership.

An objection was taken in point of form, that Hunt and the other new partners had been improperly joined as plaintiffs upon this record. When, however, the situation in which they stood is considered, that will appear to have been perfectly proper. Mr. Fawcett and Mr. Whitehouse had stipulated, when the new partners were admitted, that they should come into the concern entitled to all the advantages, and subject to all the conditions, of the original partners. Whatever

benefits the old partners had enjoyed, it was stipulated should be shared in by the new. This was one of the original benefits of the concern; and as it was conceived that this was not expressed with sufficient distinctness, a deed was afterward executed, by which it was expressly provided that, as to the proportion to which he was entitled, Mr. Fawcett should be a trustee for the Hunts, Kenrich, Priestley and himself. I think, therefore, they had such an interest as rendered it proper they should be joined as plaintiffs.

Under these circumstances, I am of opinion that the decree of the vice-chancellor ought to be affirmed; and from the nature of the transaction, and the clearness of the evidence. establishing its character, it ought to be affirmed with costs.

NOTE. The following passage, taken from the shorthand writer's note of the vice-chancellor's judgment in the preceding case, sums up the grounds on which his Honor rested the decree. "It appearing upon the evidence that Whitehouse was in truth the person who originated the contract with Knight & Co., on the part of Fawcett and Sh nd, and it appearing, also, upon the evidence he represented, that he stood on so particular a footing of connection with Knight & Co. that he could obtain better terms from. them than any stranger could; and that he further represented, on the day when the agreement between Knight & Co. and Fawcett, Shand and himself was signed, that he had obtained the best terms possible, I am of opinion, upon these grounds, and considering the situation in which he stood, that he was not at liberty to take to his own profit any part of that consideration which Knight & Co. were willing to pay to get rid of the business, but that he was bound to obtain the best terms possible for the intended partnership, consisting of Fawcett, Shand and himself, and that all he did obtain will be considered as if he had done his duty and had actually received the £12,000 for the new partnership, as upon every equitable principle he was bound to do. I am of opinion, therefore, that this is what must be called in a court of equity a fraud on the part of the defendant. It was, in fact, selling his intended partners for £12,000, and when he received the money, Fawcett became entitled to one third and Shand became entitled to another third of it. Shand is now entitled to his £4,000, and Fawcett, having communicated his interest in the former partnership to four other persons, they, with him, are entitled to the other £4,000.

MUSIER V. TRUMPBOUR.

(5 Wendell, 274. Supreme Court of New York, 1830.)

'Burning lime on shares. Where two persons agreed to burn lime on shares, one to fill a kiln with stone and the other to burn the kiln and furnish the necessary wood for the purpose, the lime to be equally divided between them, it was held, that a technical partnership existed between the parties.

Suit at law between partners. Notwithstanding the partnership, an action at law may be maintained by one partner against the other for a balance due him growing out of the partnership transaction, if there be but a single item to liquidate. Pleadings and evidence in justice's court. The same nicety and precision is not required in pleadings joined in a justice's court which are required in courts of record; and evidence will be received under pleadings joined in the former which could not be received under pleadings joined in the latter.

Error from the Greene Common Pleas. Musier sued Trumpbour in a justice court and declared for about 200 bushels of lime; the defendant pleaded the general issue, and gave notice of set-off. The cause was tried before the justice, and judgment rendered for the defendant for $2.60. The plaintiff appealed to the Greene Common Pleas, where the cause was tried on the issue joined before the justice. On the trial, the counsel in opening the cause stated that he plaintiff would prove that he was the owner of a lime kiln; that it was agreed

between him and the de endant that he would fill the kiln with stone, and that the defendant would furnish the necessa y wood and burn the kiln into lime which was to be equally divided between them; that the defendant took more than his proportion of the lime and subsequently inquired of the plaintiff how much he owed him on account of the lime, who answered $12.50, which the defendant promised to pay as soon as he got returns from a cargo of hay which he had shipped to New York; on which opening the defendant insisted that the plaintiff ought to be nonsuited, admitting the facts. to be as stated by him, because, 1. The facts showed a partnership between the parties, and the action could not be sustained unless a balance had been struck, and that there had been

1Griffith v. Buffum, 22 Vt. 181; Wadsworth v. Manning, 4 Md. 59; sea La Mont v. Fullam, 133 Mas. 583.