A partner too, if he carries on a business of the same nature as the partnership, and competing with it, must hand over to the firm all the profit he makes, unless he has the consent of his co-partners to the carrying on of such competing business.

3. Every partner is entitled to be indemnified by the firm in respect of payments made and personal liabilities incurred in the ordinary business of the firm, or for the preservation of the property of the firm.

4. Every partner is entitled to take part in the management of the partnership business.

Where any difference occurs, it is to be decided by a majority of the partners. But in three cases, the will of the majority is not recognised: (1) where a change is to be made in the nature of the partnership business, the consent of all the existing partners is required; (2) a majority cannot expel a partner unless there is a clause to that effect in the partnership agreement; and (3) a new partner cannot be introduced without the consent of all the existing partners.

5. Partners are bound to render true accounts and full information of all things affecting the partnership to any partner or his legal representatives.

6. Every partner is entitled to have access to and to inspect and copy the partnership-books, which are to be kept at the place where the business is carried

on.

§ 118. Dissolution of Partnership.-Subject to any agreement between the partners, a partnership is dissolved―

1. If entered into for a single undertaking, by the termination of the undertaking.

2. If entered into for a fixed term, by the expiration of that term.

3. If no fixed term has been agreed upon, by any partner giving notice to the other partners of his intention to dissolve the partnership. It is desirable that this notice be in writing.

4. By the death of a partner.

5. By the bankruptcy of a partner.

A partnership may, notwithstanding any agreement of the parties, be dissolved

1. By the happening of any event that renders the business of the firm illegal.

2. By a decree of the court.

The court will, as a rule, order a dissolution of partnership where circumstances have arisen that render it just and equitable that the partnership should be dissolved; where one partner is found a lunatic after inquiry; where a partner becomes permanently incapable of carrying out his partnership agreement; where a partner has been guilty of conduct prejudicially affecting the carrying on of the business, or where the business can only be carried on at a loss.

§ 119. Effects of Dissolution.-After a dissolution, the authority of each partner to bind the firm continues as far as may be necessary to wind up the affairs of the partnership, but not otherwise. The property of the firm must be realised and applied in the following order: in paying (1) the debts and liabilities of the firm; (2) any advances made by a partner; (3) what is due to the partners in respect of capital. Any surplus left is to be divided equally amongst the partners.

These rules are to be taken as subject to the terms of the partnership agreement.

§ 120. Authorities.-The greater portion of the law of partnership has been codified in the Partnership Act of 1890. Sir F. Pollock's Digest of the Law of Partnership includes this Act. A larger treatise is the standard work of Lord Justice Lindley.

CHAPTER II

PRINCIPAL AND AGENT

§ 121. Introductory.—An agent is a person employed to do an act on behalf of another. The person for whom such act is done is called the principal. The division of labour has been carried to such an extent in connection with the distribution of goods, that sellers as well as buyers often find it to their advantage to effect sales and purchases through the agency of third parties.

Any person who has capacity to enter into a contract may appoint an agent: any person may, as regards third parties, be appointed agent, even though he be a minor. An agent is usually remunerated by commission or salary, but no consideration or payment is necessary to create agency.

§ 122. Kinds of Agents.-The chief classes of mercantile agents are factors, brokers, commission agents, and del credere agents.

A factor is an agent for sale to whom possession of the goods is given.

A broker is an agent employed by two parties to negotiate a contract between them. There are several kinds of brokers. A broker for sale is an agent to sell or purchase commodities-he is not entrusted with the possession of the goods. A stock and share broker is an agent employed to sell or buy stocks or shares. An insurance broker is an agent employed to effect a policy of insurance.

A commission agent is an agent employed not by two parties, but by one party to either sell or buy goods.

A del credere agent is an agent for sale who gives an undertaking to his principal that the parties with whom he contracts will fulfil their engagements.

A distinction is sometimes drawn between "special" and "general" agents. A special agent is one who has authority to act in a special case only. A general agent is one who is employed in many cases. The authority of the former is derived from his special authority; the authority of the latter is inferred from the previous cases in which he has acted.

§ 123. Appointment of Agents. An agent may be appointed expressly by any form of words, except in special cases, where a special form is required.1 It is generally desirable to have the terms of the appointment reduced to writing, so as to avoid any subsequent dispute as to the extent of the agent's authority.

The relation of principal and agent may be inferred from the conduct of the parties. A servant who is habitually sent by his employer to order goods from a shopkeeper is regarded as the employer's agent, and a wife who is permitted by her husband to order necessaries for the household becomes his agent.

§ 124. Ratification.-Ratification of the acts done by one person on behalf of another is discussed by some writers under the head of appointment of agent. By ratification is meant the adoption of a contract by one person made by another on his behalf, but without his authority. It is not every act of another person that can be ratified, so as to make the person ratifying a party to the act and responsible for it. But where a contract is made by B. on behalf of A., without A.'s authority, in respect of something that A. can lawfully do, A. may adopt the contract and become liable on it, whether it be to his detriment or his advantage. The ratification may be by either words or conduct.

§ 125. The Authority of Agents.-The authority of an agent may be express or implied.

An authority is said to be express when it is given by 1 E.g. An agent to execute a deed must be appointed by deed.

words spoken or written. The advantage of a written authority is that the written document furnishes excellent evidence as to the extent of authority conferred.

An authority is said to be implied when it is inferred from the circumstances of the case. For example, if A. is in the habit of sending his servant B. to buy goods from C. on credit, C. is justified in supposing that the servant has authority to buy on credit. If, however, the servant was in the habit of buying for cash, and he asks for goods on credit, the shopkeeper ought at once to inquire if the servant has authority to buy on credit. If he has no such authority, the employer will not be liable to pay for the goods.

An agent authorised to do any act has authority to do every lawful act necessary in order to do such act. Hence an agent employed to carry on a business may purchase all articles necessary to such business. An agent employed to sell, may do everything requisite to effect a sale, e.g. he can sell on credit when this is the usage of the business; an insurance agent can adjust and settle a loss; a debtcollecting agent can give receipts.

§ 126. Duties of Agents.—Obedience.—An agent ought to observe the directions of the principal. This is the primary duty of an agent, and any losses resulting from a failure to obey instructions must be borne by him. All orders as to time, price, and quality should be observed. In many cases a discretion is given to him; in such a case he may take what course seems best.

In the absence of any instructions, he ought to follow the usual course of business at the place where the business is to be transacted.

Skill. The agent must conduct the business with as much skill as is generally possessed by persons engaged in a similar business. An agent ought to possess the skill requisite to enable him to discharge what he undertakes. If he is incompetent, and fails to disclose this incompetence to his employer, he must make good any resulting loss. Perfect skill is not required, only that which is possessed by those engaged in the particular business in question.

Diligence.-The agent must not only possess sufficient