423 



PARTNERSHIP. 



or his liability for losses, if there is no agreement on 

 this subject, all the partners stand upon an equal foot- 

 ing. As to the objects of copartnerships, they are 

 not confined to commerce, though most frequent in 

 that branch of industry, but may embrace manufac- 

 turing, the carrying on of any mechanic art, agricul- 

 ture, the practice of law, or of medicine, and, in 

 short, almost every lawful branch of business. 



Copartnership is more usually formed by a written 

 agreement ; and by some codes, and in regard to cer- 

 tain copartnerships, formal stipulations are required 

 by law in order to constitute a copartnership. This 

 is not a general rule, however, for, in many branches 

 of business, parties may agree orally on a participa- 

 tion in profit and loss. These associations are divid- 

 ed into different classes, distinguished by their ob- 

 jects, and the extent of the liability of each partner. 

 The Roman law allowed of general copartnerships, 

 extending the community of property and joint pro- 

 fit and loss not only to the business pursued, but also 

 to all acquisitions by either party, whether by legacy, 

 inheritance, gift, or as the fruits of industry. By that 

 law, and so by the laws of France, Spain, Louisiana, 

 and other codes derived from the Roman law, a man 

 and his wife may be copartners ; and in making the 

 marriage contract, the kind and extent of copartner- 

 ship is agreed upon, the form of the stipulation for 

 this purpose being particularly pointed out by the 

 French code. It was between the parties to the 

 marriage contract that the general copartnerships 

 above mentioned were most frequently formed. In 

 this respect, however, the Roman law, and those 

 codes derived principally from it, leave the parties 

 at liberty to agree upon a universal copartnership or 

 a limited one, or a separate property. 



Copartnerships are usually confined to the prosecu- 

 tion of a particular branch of business, and it very 

 often happens that each copartner is concerned in 

 other branches. The term general copartnership is 

 also applied to one formed for trade generally, or 

 business generally, without limitations ; but where 

 the joint interest extends only to a particular concern, 

 as, for instance, the freighting of a ship, it is called 

 a special copartner ship. And so a partnership is call- 

 ed special when the parties enter into stipulations 

 modifying and restraining the powers and rights of 

 the members, instead of leaving them to the operation 

 of the laws generally applicable to such associations ; 

 and this is the usual meaning of special copartnership. 

 Another description is that of limited copartnerships, 

 in which one or more partners put in a certain amount 

 of capital, which is liable for the contracts of the firm ; 

 but beyond this the party or parties are not liable. 

 This sort of partnership is particularly provided for 

 in the French code, and is not unfrequent in France. 

 It is a very useful provision of the law that allows of 

 such associations, for it enables persons of fortune, 

 and retired from business, to put a part of their capi- 

 tal at risk in trade, without risking their whole pro- 

 perty ; and it accordingly operates very favourably 

 upon the enterprise of the community ; for a young 

 man who has only his talents and industry to put into 

 a concern, can thus more easily obtain the capital 

 necessary to give his activity and enterprise scope, 

 and every community ought to open all practicable 

 channels for the intellectual and physical exertions of 

 its members. The condition of such a limited copart- 

 nership is, that the name of the person whose liabil- 

 ity is thus limited must be used in the firm, and parti- 

 cular provisions are made as to paying in the amount 

 of capital stipulated; and another suitable provision 

 in such case is the provision for some registry by 

 which it may appear to those who wish to make the 

 inquiry what amount such partner pays in. Some 

 partnerships are secret; that is, some one agrees, 



upon certain terms, to share profits with the ostensi- 

 ble partners, without any notice to the public of his 

 being a member of the firm. Each partner has a 

 joint interest in the whole personal properly, and, un- 

 Mri the articles stipulate otherwise, may transfer it. 

 Each partner may also bind the whole firm by his 

 contract made in the course of the business of the 

 firm, unless it be otherwise agreed between them. 

 And even when it is otherwise agreed, still, if a party 

 with whom a partner contracts has a legal right, from 

 the manner in which the joint affairs are managed, to 

 presume that a partner is authorized to contract for 

 and bind his copartners in regard to the subject of 

 any contract, the firm will be bound by such contract. 

 But if the party contracted with has notice that, by 

 the articles of copartnership, a partner lias not author- 

 ity to make a contract, the company will not be 

 bound by it. So if a partner contracts, in the part- 

 nership name, in a matter which the party contracted 

 with knows is not within the business of the firm, 

 as if he makes a negotiable note in the name of the 

 firm for his own separate debt, the contract will 

 not bind the firm to the party thus contracted with ; 

 but still, if this contract, being transferable in its 

 nature, and holding out on the face of it the responsi- 

 bility of the whole firm, is negotiated to those who 

 have no notice that the paper was made for the pri- 

 vate accommodation of the partner who signed the 

 partnership name, the company will be bound in re- 

 spect to such assignee ; that is, the firm having 

 given notice to the world that they are copartners in 

 a certain branch of business, every one has a right 

 to presume that all acts done by each of them in re- 

 gard to it are authorized by the terms of their con- 

 tract or the circumstances of the case, unless he has 

 notice to the contrary. But certain acts are not 

 authorized by the general powers of copartners, and 

 those no one partner can be presumed to have power 

 to do ; as for instance, one partner is not, merely as 

 such, authorized to make a deed in the name of the 

 other, or to act as his attorney ; and he cannot, ac- 

 cordingly, convey land belonging to the members of 

 the company ; for, though it may have been acquir- 

 ed and paid for with the property of the firm, yet 

 when acquired it belongs to the members in common, 

 if the title be in them all, and each member can him- 

 self convey only his share; and in order to the con- 

 veyance of that of another, he must be specially em- 

 powered. But a partner may release a debt due to 

 the firm, if it be done fairly, and without collusion be- 

 tween him and the debtor. It has been held, how- 

 ever, that one partner cannot by deed submit a 

 question to arbitration. 



A partnership may be dissolved by its own limita- 

 tion, the death, bankruptcy, or insanity of a member, 

 or by the breaking out of a war between the countries 

 to which the members belong. A question is also 

 made whether a member may dissolve the copartner- 

 ship voluntarily before the time for which it was 

 formed expires ; and the opinion seems to be that he 

 may do so by giving sufficient notice to this effect ; 

 and this seems to be necessarily incident to new as- 

 sociations. For though he would, in such case, be 

 answerable to his copartners for the breach of his 

 agreement, yet it would be exceedingly inconvenient 

 if a partner were irrevocably bound to give his copart- 

 ners the right of his credit, and of disposing of his 

 property after all his confidence in them had ceased. 

 In case of mismanagement by any partner having the 

 charge of the partnership effects, so that the other 

 partners are liable to be materially injured, they may 

 make application to a court of chancery to appoint a 

 receiver to take charge of the concerns of the com- 

 pany, and wind up its affairs, in case the partnership 

 has already been dissolved, or in case there appears 



