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PART III. (Tudor Ca. on M. L. 315, 318-9; Broom Com. 547; Lindley, 337, 353.)

TIT. II.

CAP. V.

Rights of creditors.

Dissolution.

The liability of a dormant partner ceases on his retirement, except as to persons who knew him to be a partner, and to whom he has not given notice of his retirement. (Broom Com. 548; 2 Ste. Com. 102; Tudor Ca. on M. L. 315; Lindley, 326.)

On the death of a partner, his personal representative is exonerated at law; but in equity the estate of the deceased is liable until his debts have been discharged. (Sm. Merc. Law, 51; Tudor Ca. on. M. L. 316.)

The creditors of the partnership have a right to the payment of their debts out of the partnership funds, before the private creditors of either of the partners, although, at law, this is generally disregarded. On the other hand, in equity, the separate creditors of each partner are entitled to be first paid out of the separate effects of their debtor, before the partnership creditors can claim anything, although, at law, a joint creditor may proceed directly against the separate estate. (Sm. Manual of Equity, 317; Tudor Ca. on M. L. 316, 356.)

A partnership may be dissolved: 1. By effluxion of time. 2. By mutual consent. 3. By the decree of a Court of Equity, in

TIT. II.

CAP. V.

case the partnership undertaking originated PART III. in fraud, misrepresentation, or oppression, or cannot be carried on at all, or at least according to the stipulations in the articles, or without injury to all the partners; or in case of the permanent insanity or incapacity or the gross misconduct, as partner, of one of the firm; such as refusing to account for his receipts. 4. If no limit was originally fixed, it is called a partnership at will, and may be dissolved by either partner at a moment's notice, unless such a dissolution would be in ill-faith, or would work an irreparable injury. 5. The entire partnership is also dissolved by a general assignment by one or more of the partners, or by an execution on the partnership effects by a creditor, or by the bankruptcy of any partner, or by his outlawry, or by his attainder of treason or felony. 6. And the death of a partner, or the marriage of a female partner, operates as a dissolution. But in the case of a partnership of three or more persons, the other persons may, of course, come to a new agreement to carry on the business upon the old terms. (Sm. Merc. Law, 27-8; Sm. Manual of Equity, 315; 2 Ste. Com. 98; Tudor Ca. on M.L.331-9; Lindley, 178-87.)

H

CHAPTER VI.

PARTIES TO BILLS OF EXCHANGE AND PROMIS

SORY NOTES.

Negotiable Instruments.

PART III. CHOSES IN ACTION, (i. e. rights to things which

TIT. II.

property in a

sonal by one

in whom it is

CAP. VI. are not in possession, but can only be recovered, if withheld, by an action,) are not Transfer of assignable at law. The ownership in a chattel chattel per- personal cannot, except by sale in market overt, be transferred at law to a vendee by a person in whom it is not vested. But negotiable instruments are an exception to this rule. (Sm. Merc. Law, 202; Broom Com. 428-30.)

not vested.

Negotiable instruments

An instrument is properly negotiable, when described. the legal right to that which is secured by it, and the right of action on it in case of default, are transferable from one person to another, so as to enable the latter to sue upon it in his What are ne- own name. Thus, bills, whether payable to order or to bearer, are negotiable ad infinitum; and the transfer vests in the assignee a right of action in his own name on the in

gotiable.

strument assigned. (Chit. B. 137; Broom Com. 428; 2 Ste. Com. 113, 121.) An exchequer bill, the blank in which has not been filled up with any person's name, is also transferable by delivery. (Chit. B. 138.) Bills of lading are transferable by indorsement, so as to vest the contract in the indorsee. And a cheque or draft on a banker is as negotiable as a bill of exchange. (Chit. B. 138; Mau. & Pol. 226-7.)

There are other instruments which, though saleable by mercantile usage, are not, properly speaking, negotiable; for none but the original contractee can sue upon them. And instruments which are negotiable in one state, may be deprived of their negotiable character. Thus, a bill or a note, when indorsed in blank, is negotiable; yet, by a special indorsement, the holder may cause its negotiability to cease. (Sm. Merc. Law, 203.)

Bills of Exchange and Promissory Notes.

PART III.

TIT. II.

CAP. VI.

change de

A bill of exchange (frequently termed a Bill of exdraft) is a written order or request, signed, fined. but not sealed, by one person to another, for the payment of a sum of money, at a specified time, unconditionally. The person making this order or request is called the drawer;

PART III, the person to whom it is addressed, the

TIT. II.

CAP. VI. drawee, and, if he accepts it, the acceptor;

Accommodation bill.

Holder of a, bill.

Cheque defined.

the person in whose favour it is made, the payee. (Sm. Merc. Law, 206; Chit. B. 5; Broom Com. 433-6; Byles, 1.)

An accommodation bill is a bill which is accepted without value passing, merely to accommodate the drawer, by enabling him to get it discounted. And it sometimes happens that two persons agree to mutually draw upon one another, without any value passing; and the drawer in each case gets his banker, or some other person relying on the credit of the drawer and acceptor, to discount the bill, so as to raise money, for purposes of speculation and other purposes; the discounter not knowing but that the full value passed, and the acceptor hoping to have funds to pay the bill at maturity. In these cases there is an implied contract on the part of the drawer, as the party accommodated, to pay the bill at maturity, and to indemnify the acceptor in case he is obliged to pay it for him. (Ste. Lect. 50-2; Broom Com. 436, 481.)

The owner of a bill is called the holder, or, where it is transferable by delivery, the bearer. (Chit. B. 19.)

A cheque is a species of bill of exchange. It is an order or request, made in writing, or

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