it on his behalf. I think that this is shown by the fact of his being a partner in the trade and sharing the profits of it. Being a dormant partner, he authorizes the ostensible partners to enter into such contracts as are usually entered into in the course of such a business. ... If the plaintiff entered into the contract in ignorance of Drake being a real partner, the case would be within the same principle of law which applies to the introduction of a principal before unknown, where the party who contracted upon the supposition that the agent was the principal, is entitled to all the same benefits and rights, and stands precisely in the same situation, as he would have been if he had been aware of the real principal. For all questions between partners are no more than illustrations of the same questions as between principal and agent." (y)

The liability of persons who have participated as principals in the joint speculations and contingent profits of a partnership, or joint adventure, cannot in any way be controlled or affected by the secret contracts of the joint adventurers inter se. If, therefore, the joint adventurers expressly agree not to be partners inter se, such an agreement cannot in any way affect their position as regards the public. (2) If several partners or joint adventurers in a particular trade or business agree that the trade shall be carried on by one or more of them in their own names as the ostensible and acting partners, and that certain secret partners who contribute capital, skill, or labour to the joint stock of the partnership, shall not be liable for losses beyond a certain amount, the operation of the agreement is confined to those who were parties to it, and cannot affect the liability of such secret partners quoad the public and third persons ignorant of the private stipulations and arrangements of the firm. (a)

And it matters not whether the party participates in and receives or bargains for a share in the accruing profits for his own benefit, or as a trustee or executor for others. (b) Equally indifferent is it whether his share be large or small. (c)

But the mere existence of a secret partnership in the subsequent disposition of goods purchased by one partner on his own individual credit, and not on the credit of the co-partnership, will not render the secret partner liable for the payment or the price of them. Thus where three parties agreed to bring out and publish a periodical called the Sporting

(y) Beckham v. Drake, 9 M. & W. 97, 98. Drake v. Beckham, 11 M. & W. 316, 317. (2) Waugh v. Carver, 2 H. Bl. 235. Hesketh v. Blanchard, 4 East, 144. Smith v. Watson, 2 B. & C. 401.

(a) Ex parte Langdale, 18 Ves. 300. Geddes

v. Wallace, 2 Bligh, 270. Gilpin v. Enderbey, 5 B. & Ald. 954. Bond v. Pittard, 3 M. & W.

357.

(b) Wightman v. Townroe, 1 M. & S. 412. Ex parte Garland, 10 Ves. 119, 120.

(c) 9 East, 527.

Review on their joint account, upon the terms that one of them, who was an author, was to write the book, and furnish manuscript and drawings, and another, who was a printer, was to furnish the paper for the work and charge it to the account at cost price, and was also to charge the printing at "master's prices," and the third, who was a publisher, was to publish the work, raake and receive general payments, keep the accounts, and divide the profits between the three, and the printer ordered paper for the work, but became bankrupt before he had paid for it, whereupon the stationer sought to recover the price from the other two partners, it was held that they were not liable for the payment of it, as it was bought upon the individual credit of the printer. "The question is," observes Parke, B., "did the other defendants authorize Whitehead (the printer) to purchase the paper on their account or on his own. It appears to me, on the true construction of the contract, that the latter was the case. This is very much like the case of coach proprietors, where each horses the coach for one or more stages, and each agrees to bring into the concern the work and labour of his horses, and none of the others has any interest in them, though all share the profits." (d)

Where, however, a publisher gave an order to a stationer to deliver to the defendant, who was a printer, "two hundred reams of super-royal paper for Jeremy Taylor's works, and seventy-two reams for Doddridge's Expositor," and the paper was delivered at the printer's office, and it was afterwards discovered that the printer was at the time of the giving of the order a partner with the publisher in both the works mentioned in the order, it was held that he was liable, together with the publisher, for the price of the paper. "I can conceive," observes Lord Denman, " that all the partners may not be liable for all that is done by each individual partner, but I think that in such cases there should be something exclusive in the nature of the transaction, not only that they should not be known, but that the ordering of the goods should be the exclusive act of the particular partner." (e)

Generally speaking, when several persons agree to be jointly interested in the disposal of certain goods when purchased, so as to constitute themselves partners in the transaction, and the goods are obtained for the joint use and benefit of all of them, they are all responsible for the whole bargain as the real principals in the transaction, so that the full value of the goods may be recovered from any one of them, although they were purchased on the credit of the ostensible buyer alone. If, indeed, the

(d) Wilson v. Whitehead, 10 M. & W. 503. (e) Gardiner v. Childs, 8 C. & P. 345, 351.

K K

parties are not jointly interested in the disposal of the goods when purchased, and are not trading with them as partners on their joint account, then they cannot be sued jointly for them, and one cannot, as we have already seen, be made to pay the price of the whole, but each is separately responsible for his own separate share only of the things so bought.

Several persons employed a broker to purchase tea for them at the India House, and furnished him with money to make the usual deposits on the purchase. The tea was bought in one lot, to be subsequently divided between the parties in separate shares, but before the transaction was completed, most of the parties who had joined in the purchase died or became bankrupt, and two of them were sought to be made responsible for the full price of the tea, on the ground that they were all secret partners, and jointly and severally liable in respect of the entire lot of tea purchased, as well as of their individual shares; but the court held that there was no partnership at all between the parties who had employed the broker, and that the defendants were severally liable only to the amount of their separate shares. "At first," observes Lord Mansfield, "I considered this as a case of dormant partners. The law with respect to them is not disputed, viz., that they are liable when discovered, but towards the end of the cause the nature of the transaction was more clearly explained. . . . . Is this a partnership between the buyers? I think it is not, but merely an undertaking with the broker by each for a particular quantity. There is no undertaking by one man to advance money for another, nor any agreement to share with one another in the profit or loss. It would be most dangerous if a person who engages for a fortieth part, for instance, should be considered bound for all the other thirty-nine parts. Non hæc in fœdera veni."(ƒ)

Three persons agreed amongst themselves to purchase jointly a quantity of oil on speculation. Eyre, one of their number, was to go into the market and be the ostensible buyer, and the others were to share in the purchase at the same price which he might give. Eyre accordingly bought the oil but never paid for it, and it was held that the other two persons could not be sued jointly with him as his secret partner in the transaction; that the agreement was a subcontract to share severally in certain proportions in the purchase to be made by the ostensible buyer on his own credit, and that the failure of such buyer to pay the price did not render the two other subcontractors responsible for the price of the whole bargain.(g)

LIABILITIES of NOMINAL PARTNERS to the CREDITORS of the FIRM.

Nominal partners.-Persons may become clothed with the legal liabilities and responsibilities of partners as regards the public and third parties, by holding themselves out to the world as partners as well as by contracting the legal relationship of partners inter se. If the question of partnership were between A. and B. whether they were partners or not, it would be very well to inquire whether they had contributed, and in what proportions, stock or labour, and on what agreements they were to divide the profits of the contribution. But when the question is not between the parties themselves as to what shares they shall divide, but respecting creditors claiming a satisfaction out of the funds of a particular house as to who shall be deemed liable in regard to those funds, the sense or understanding of the parties themselves inter se that they shall not be partners; that A. shall contribute neither labour nor money nor receive profits will be of no avail and will not affect the existence of the partnership so far as regards the public at large. "If a man will lend his name as a partner, he becomes as against all the rest of the world a partner, not upon the ground of the real transaction between them, but upon principles of general policy to prevent the frauds to which creditors would be liable if they were to suppose that they lent their money upon the apparent credit of three or four persons, when in fact they lent it only to two of them. (h)

If a man, therefore, allows himself to be published to the world as a member of a particular firm, if he permits his name to appear in the partnership name, or to be used in the business, if he suffers it to be exhibited to the public over a shop window, or to be written or printed in invoices, or bills of parcels or prospectuses, or to be published in advertisements as the name of a member of the firm, he is an ostensible partner and is chargeable as a partner, although he is not in point of fact a partner in the concern, and has no share or interest in the profits of the business. Thus where a merchant, carrying on trade on his own separate account, introduced into his firm the name of a clerk who had no participation in the profits, but continued to receive a fixed salary as clerk, it was held, as regarded the public and third parties ignorant of the private arrangement, that the clerk must be taken to be a member of the firm. "He is to be considered," observes Lord Ellenborough, "in all respects a partner as between himself and the rest of the world."(i)

But if a man is sought to be charged as a partner by reason of his hav

(h) Eyre, C. J.; Waugh v. Carver, 2 H. Bl. 246; 1 Smith, 502, 503.

(1) Guidon v. Robson, 2 Campb. 304.

ing permitted his name to appear in printed papers, prospectuses, or advertisements, it must appear that the partnership was actually formed and in operation, and was not merely a projected joint adventure. If he has merely signed his name to a prospectus and advertisement, intimating that he is about to become a partner, or that a partnership or company is about to be formed on certain conditions, and on the happening of certain events, he does not thereby hold himself out to the world as an actual partner in an existing partnership, and cannot be made liable as such unless he does some further act actually constituting him a partner. (k)

If a person holds himself out to the world as a partner with another in a particular line of business only, he does not thereby render himself liable as a partner in other transactions not within the ordinary and reputed course of business of the partnership to which he professes to belong. (1) And, if a plaintiff has contracted with a firm in partnership, knowing at the time that the defendant, whose name appeared in the name of the firm as an ostensible partner, was not in fact a partner, and had no share or interest in the partnership, he cannot afterwards make the defendant responsible upon the contract which he entered into with notice of that fact.(m)

If a man's name is used without his knowledge and consent, and he is represented by others to be a partner without his authority or permission, he cannot of course be made responsible as a partner upon the strength of such false and fraudulent representation. (n) "The holding oneself out to the world as a partner, as contradistinguished from the actual relation of partnership, imports at least the voluntary act of the party so holding himself out. It implies the lending of his name to the partnership, and is altogether incompatible with the want of knowledge that his name has been so used. Thus, in the ordinary instances of its occurrence, where a person allows his name to remain in a firm, either exposed to the public over a door, or to be used in printed invoices, or bills of parcels, or to be published in advertisements, the knowledge of the party that his name is used, and his assent thereto, are the very grounds upon which he is estopped from disputing his liability as a partner." (o)

Although a man's name may not have been used in the partnership business, and he may not consequently be known to the public as an ostensible partner, yet if he privately represents or states himself to be a partner, and goods are furnished, or credit given to the firm upon the

(k) Bourne v. Freeth, 9 B. & C. 640, 641.
(1) De Berkom v. Smith, 1 Esp. 29.
(m) Alderson v. Pope, 1 Camp. 403, 404, n.

(n) Newsome v. Coles, 2 Campb. 617.

(0) Tindal, C. J.; Fox v. Clifton, 4 M. & P. 713, 714.