Lecture VIII. executors as against the surviving partners is simply to have the share of the deceased ascertained and paid, but this frequently cannot be done without a general sale and winding-up of the partnership. A bonâ fide sale, however, by the executors to the surviving partners, can generally be made with safety if no surviving partner is Executors of a deceased Partner. Joint Risks of an an executor. The position of the executors of a deceased partner is, in fact, often one of considerable hardship and difficulty. If they insist on an immediate winding-up of the firm they may ruin those whom the deceased may have been most anxious to benefit; whilst if for their advantage the partnership is allowed to go on, the executors may run the risk of being ruined themselves. With a view to obviate this, it is not unusual for one partner to make his co-partner his executor; but the difficulty of the executor's position is thus rather increased than diminished, for his own personal interest as a surviving partner is brought into direct conflict with his duty as an executor. As regards joint creditors the deceased partner's estate is liable to the creditors of the firm, and not only in respect of debts contracted in his lifetime in the ordinary way of business, but also in respect of debts arising from breaches of trust committed in his lifetime by himself or his co-partners, and imputable to the firm. This liability cannot be got rid of by any arrangement between the executors of the deceased and the surviving partners, and the liabilities of the executors continue until it can be shown that the creditors have abandoned their right to obtain payment from the estate of the deceased, or that their demands have, in fact, been paid or discharged. It is, of course, clear that if the executor of a deceased partner carries on the partnership business he becomes personally liable to third parties as if he were a partner in his own right, and whether he is entitled to Lecture VIII. be indemnified out of the assets of the deceased depends upon whether he has carried on the business pursuant to the will of the deceased or the directions of those beneficially interested in his estate. It may be taken as a general proposition that the estate of a deceased partner is not liable to third parties for what may be done since his decease by the surviving partners. As regards the right of separate creditors and legatees, they must look for payment for what is due to them out of the assets of a deceased partner to his legal personal representative, and to him alone. It will be observed that in these few remarks as to the result of the death of one of the partners, I have assumed that the firm and the deceased partner's estates are solvent. The question as to how the estate of a deceased bankrupt has to be distributed belongs to the Bankruptcy Law, which forms a separate part altogether of your professional studies. LECTURE IX. ARBITRATIONS. Read before the Institute of Chartered Accountants at the Lecture IX. Increase in number of Arbitrations. Law Relating The practice of referring disputes to arbitration, and thus having them settled without recourse to the Law Courts, is one that has very much increased in the last few years, and as it frequently falls to Chartered Accountants to be appointed to the important office of Arbitrator, and also to the still more important one of Umpire, and as also they are very frequently required to give evidence as qualified or expert witnesses in arbitrations, it is necessary that they should be acquainted to a certain extent with the law, and also with the practice, relating to the subject. The law relating to arbitrations embraces a very to Arbitration. wide subject, and it would be quite impossible in the scope of a lecture to cover the ground in as thorough a manner as one would wish. I can therefore only attempt to give a general outline of it in this address. It is true that the Arbitration Act, 1889, under which all ordinary commercial arbitrations are settled, tended very much to simplify the law, and although there are other Acts of Parliament under which special arbitrations are now held, still, unless I make any special reference to the contrary, you will understand that my Lecture IX. remarks to-night are intended to apply principally to arbitrations held under this Act. As regards practice, the method of conducting arbitrations is in all cases the same. Arbitration. Arbitration is defined to be the submitting of a Definition of matter in dispute to the judgment of one, two, or more persons called Arbitrators, and there are four requisites in order that the arbitration shall be a properly constituted and valid one : I. There must be parties to the dispute. 2. 3. There must be an agreement to refer the There must be the appointment of such third person as Arbitrator. 4. There must be an acceptance of the office by the Arbitrator thus appointed. sion. The agreement to refer the dispute to the decision The Submisof a third person is called a "submission," which, according to the Arbitration Act of 1889, means, unless the contrary intention appears, a written agreement to submit present or future differences to arbitration, whether an Arbitrator is named therein or not. under Order of There are other forms of submission to arbitration in addition to the one indicated, which is practically a voluntary agreement between two or more parties. Very frequently, when there is a cause depending, an Reference order of Court, or a Judge's or Master's order, will by Court. common law be drawn up on consent of the parties referring the cause to arbitration, or the Court may order a reference whether the parties assent or not. I do not, however, propose to enumerate the various ways in which an arbitration can arise when an action at law has commenced, for, as a rule, when arbitration takes place under an order of the Court, the matter is usually R Lecture IX. referred to one of the official referees of the High Court. Occasionally, however, where questions of account, or matters requiring scientific investigation, are concerned, a special referee—as a private person, nominated by the Court or selected by the parties, is styled-may be appointed by the Court. A Valuation not an Arbitration. Nomination of The object of an arbitration is the settlement of matters in dispute between the parties, and consequently a valuation or an appraisement is not an arbitration. On a sale of landed property it is one of the usual conditions of sale that the purchaser shall pay for the timber on the land at a valuation, and he and the vendor then each appoint a valuer; the valuers usually appoint an umpire, who makes the valuation in the event of the valuers not being able to agree on the price to be paid for the timber. Such a valuation is not in the nature of an award or an arbitration, and an application to the Court to set aside a valuation of this nature has been refused on that ground. It is frequently the custom, after it has been decided by two disputants to refer the matter at issue between them to arbitration, for each of them to name an Arbitrator; this, to my mind, is open to many objections, as, in the first place, there is a natural inclination on the part of each Arbitrator to lean towards the party nominating him, and to regard him as his client; in which case it is always necessary for them to agree upon an umpire, as he is called, who will give the final decision in the event of the Arbitrators being unable to give an award. This is an exceedingly wrong practice, and contrary to all notions of an Arbitrator's duty; and one of the principal objections to it is that it greatly adds to the expense, as it requires three professional men where one is really sufficient. Although you will, doubtless, consider this may be to the interest of the profession, yet I think you will agree |