joint, and session. Where effect, unless possession of the property be given pursuant to What the contract. And, if there is any fraud in the trans- what seaction—as if one partner retires when the partnership is parate really insolvent, and (before the partnership debts are dis- property. charged) the continuing partners pay to him large sums of with posmoney on account of his share in the business, - such payments are fraudulent and void against the joint cre- payments ditors. (1) But the mere circumstance of the partnership to retiring being insolvent, at the time of the dissolution of it by the fraudulent. retirement of one partner, will not alone be sufficient to invalidate a dissolution fairly made, however it may affect his rights to his share of the property, as against the then joint creditors. (2) purchased with partnership If real estates are purchased with the partnership funds, Where though conveyed only to one partner, they are nevertheless real estates partnership property. But if estates are purchased with the partnership fund, and conveyed to one partner under fund. specific agreement that the estates shall be his, and that he shall be debtor for the money to the partnership, the estates are in this case his separate property. (3) - out of ship funds, but registered in name of one partner. Where one of two partners purchased ships with the As to ships paid for partnership property and upon a discovery of the transaction by the other partner, the ships were brought into partnerthe partnership account, and the disbursements paid out of the partnership funds, but the registers continued unaltered, for the purpose of enabling the other partner to evade penalties, to which (as a member of parliament) he would have been liable on account of the ships being employed in the service of government—and upon his death a commission of bankrupt was issued against the partner, in whose name the ships were registered; it was held, (1) Anderson v. Maltby, 4 Bro. 423. 2 Ves. jun. 244. A fraudulent assignment of property by one partner to another, though an act of bankruptcy in the assignor, does not, as we have before had occasion to observe, amount to such in TT the assignee. Whitwell v. Thomp- (2) Ex parte Peake, 1 Mad. 553. What joint, and what separate property. under these circumstances, that the ships were distributable as the separate property (1) of the bankrupt partner. This case was decided with reference to the policy of the then registry acts, the 26 G. 3. c. 60. and 34 G. 3. c. 68.; and Whether other cases also, under those acts, have decided that the registry conclusive registry of a ship was conclusive evidence of property, even against the claim of creditors upon a joint purownership. chase (2), and various acts of apparent ownership. In a subsequent case, however, under a commission against two partners, it has been held, that where ships are purchased or built, and paid for out of the partnership funds, though they are registered in the name of one of the partners, yet, being in the ordering and disposition of both, the ships form part of the joint estate. (3) proof of Insurance of interest of joint owner. Where three part ners sell their goods elsewhere in the name of two. Liability of joint estate to expenses. When property considered If one joint owner of a ship insures his share or interest, and a loss happens, the money recovered upon the insurance will be separate property. (4) Where three partners were manufacturers in Lancashire, and sold their goods in the name of two only, and a credit was acquired by them, as three in Lancashire, and two in London, the distribution of their property in Bankruptcy was held to be, where the order and disposition was at the time of the bankruptcy. (5) Whatever expense assignees under a separate commission have been put to in getting in the joint estate, must be reimbursed out of the joint estate. (6) Although the property of a partnership be only in one or more members of it, with an interest in the profits merely as joint in the others, yet, in Bankruptcy, the property is adproperty. ministered, with respect to the claims of the joint creditors, as belonging to all the partners. (7) (7) Ex parte Hunter, 2 Rose, SECTION III. What is a JOINT, and what a Separate, Debt. can bind A partner, dealing in the name of the partnership, may When one by simple contract bind his copartners without their express partner assent (1); and this even in a matter not relating to the his copartnership, provided the person, with whom such partner partners. deals, has no notice that he is dealing on his separate account. But, if it is manifest to a person advancing money to an individual partner, that it is upon his separate account (and therefore against good faith that such partner should pledge the partnership), it is then incumbent on the person dealing with him to shew, that the partner had some authority to bind the partnership (2); otherwise the firm will not be liable. Therefore in a recent case, where one partner gave an acceptance in the name of the firm, in satisfaction of his own private debt, and without the knowledge of his co-partner, the Vice-Chancellor held that such an acceptance did not bind the joint estate. (3) tice of the The authority, indeed, of one partner in drawing or Authority accepting bills is only an implied authority, and may be to accept bills may rebutted by express previous notice to the party taking the be rescindbill, that the other partner would not be liable for it,—even ed by nothough the partner giving the bill represented to the holder, other that the money (advanced by him as a consideration for partner. the bill) was to be applied to partnership purposes — and though the greater part was in fact so applied. (4) Where the other partners, however, are in any way privy to the transaction, and permit him to go on with it, or to repeat it, without expressing any disapprobation, they will then be considered to have approved of the act of the (1) Ex parte Gardome, 15 Ves. 286. (2) Ex parte Peele, 6 Ves. 602. Arden v. Sharpe, 2 Esp. 524. (3) Ex parte Goulding, Sittings after Trinity Term, 1826. (4) Lord Galway v. Mathew, 1 Camp. 403. 10 East, 264. What a joint, or separate debt. partner so pledging the partnership name; and such subsequent approbation will be equivalent to previous consent. (1) And the act of one partner, done with reference to business transacted by the firm, will bind all the partners, although it be out of the regular course of trade, and be contrary to an express arrangement amongst themselves; because it is within the scope of his authority. (2) If one of several partners apply trust property, with the application privity of the other partners, to the purposes of the partnermoney by ship, the debt may be proved either against the joint one part- estate, or the separate estate of the partner so misapplying the money. (3) But if the other partners have no knowledge whatever that the money is trust money, then there can be no proof against the joint estate. (4) When mis of trust ner. Where a new part ner bound by an engagement of the firm for an old debt. Where Where partners, who have previously contracted debts, take a fresh person into partnership, and give paper of the new firm to a creditor in payment of a previous debt, such transaction (without evidence of the assent of the new partner) will not be binding upon him (5), provided the party taking the security had either actual knowledge, or by necessary inference must have known, that the payment was without the consent of the new partner. But, where the creditor receives it bona fide without such knowledge at the time, no subsequently acquired knowledge, of the misconduct of the partner giving the security, can disaffirm the transaction. (6) The joint responsibility of partners cannot be established, money ap- after the separate liability of a single partner was originally plied for contemplated. (7) But in a case, where a bill was drawn by one of the partners upon the partnership firm with the poses, with the privity privity of the other partner, which, though not accepted, partner (1) Ex parte Bonbonus, 8 Ves. 541. (2) Sandilands v. Marsh, 2 B. & (3) Ex parte Watson, 2 Ves. & B. 414. (4) Ex parte Apsey, 3 Bro. 265. Ex parte Heaton, Buck, 386 (5) Sherriff v. Wilks, 1 East, 48. Hope v. Cust, cit. ibid. (6) Swan v. Steele, 7 East, 210. Ridley v. Taylor, 13 East, 175. (7) Enly v. Lye, 15 East, 7. 645 As to taking sepa rate secu rity of one partner for a joint was discounted by the payee, and the proceeds applied to What a joint, or the use of the partnership, it was held, that the payee separate might sue both partners for the money, although they had debt. incurred no joint liability on the bill. (1) And the same, of all the where a holder had discounted bills drawn by one partner partners. and indorsed by another, and the money received by means of the bills had been applied for partnership purposes. (2) Where a joint creditor of a partnership takes the separate security of one of the partners, the others are thereby discharged (3), unless their liability be expressly reserved. (4) But mere information to a creditor, that a partnership was dissolved, and that one of the partners had taken upon himself to discharge the creditor's debt, was held not to bar him of his right against the other partner, notwithstanding even the creditor might expressly agree to exonerate the other partner from all responsibility; for an agreement to abandon a legal claim, unless there be a consideration shewn, is a mere nudum pactum; and the arrangement between the partners will not deprive the creditor of his original claim, unless he is a party to it himself, and it amounts to satisfaction. (5) debt. In the case of a dormant partner-when the ostensible When a partner accepts bills in his own name, though the creditor dormant partner has no notice that there is a dormant partner at the time he liable. takes the bills, this will not be a discharge of the dormant partner, but he will become liable the moment he is known to the creditor. (6) Wherever, indeed, there is a dormant partner, and the fact was unknown to the creditor, it is an invariable rule in Bankruptcy, that the creditor has an option to consider his debt as either (7) joint or separate. |