SECTION III.-DIFFERENCE BETWEEN PARTNERSHIPS AND COMPANIES IN THE FOREGOING RESPECTS.

compared with

A company which is neither incorporated nor priviledged by the Crown or the Legislature is substantially a partnership; Companies and although the transferability of its shares consider- partnerships. ably modifies the application to it of the ordinary law of partnership, still the company, like an ordinary firm, is not in a legal point of view distinguishable from the members composing it; and the statements made in the preceding pages with respect to partnerships are equally applicable to companies which are neither incorporated nor privileged.

A company which is incorporated, whether by charter, special act of Parliament, or registration, is in a legal point of view distinct from the persons composing it, and is therefore regarded by lawyers somewhat as a firm is by non-lawyers. It *sues and is sued by a name of its own, and its continuous *217 existence is not affected by changes amongst its members.

A company which without being incorporated is privileged to sue and be sued by the name of some public officer, is as it were, half way between an incorporated company and one of the kind first alluded to. So far as its privileges do not make a difference, the company is a partnership; and so far as its privileges extend, it may without any great inaccuracy be likened to a corporation; for the main object of these privileges is to confer upon the company a sort of continuous existence, whatever changes may take place amongst the individual shareholders.

The consequences of these differences may be inferred from what has been said in the preceding section, and as they will have to be adverted to in detail in other parts of the work, it is unnecessary to draw attention to them, more particularly in the present place.

ent unskillfully, both are liable to him in damages. Warner v. Griswold, 8

Wend. 665.

279

THE DURATION OF A CONTRACT OF PARTNERSHIP AND OF THE CAUSES OF ITS DISSOLUTION.

SECTION 1.-OF PARTNERSHIPS AT WILL AND FOR A TERM.

will and for a
term.
prima facie,
partnerships
are at will.

A CONTRACT of partnership is determinable at the will of any Partnerships at one of the persons who have entered into it, provided it has not been agreed that the contract shall endure for a specified time. In other words, the result of a contract of partnership is a partnership at will, unless some agreement to the contrary can be proved. (a) Such an agree ment may be established as well by direct evidence as by implication, from the acts of the partners; and it is not possible to lay down any rule by means of which the intention of the partners on this head can be certainly ascertained, where no express agreement has been come to. One or two points, however, on the subject have been decided, and demand notice.

The mere fact that a firm has incurred debts, and charged its asEffect of exist- sets for their payment, is no evidence of an agreement ence of debts. that the firm shall continue until its debts are paid, for those debts may be paid as well after as before a dissolution. (b) Again, the fact that the partners have, for partnership purposes, taken land on lease for a term of years, is not proof of an agreement that the partnership between them shall subsist for the same period. This has been decided on several oc

Effect of taking a lease.

(a) See per Parke, J., in Heath v. Samson, 4 B. & Ad. 175; Frost v. Moulton, 21 Beav. 596, and the cases cited in the following notes.

1See post, p. 220, note.

(b) See King v. The Accumulative Assurance Co. 3 C. B. N. S. 151.

casions (c), and the reasons are thus given by Lord Eldon in *Crawshay v. Maule, a leading *219 Crawshay v. case upon the subject. "Without doubt, in the

Maule.

absence of express there may be an implied contract as to the duration of a partnership, but I must contradict all authority if I say that whenever there is a partnership, the purchase of a leasehold interest of longer or shorter duration, is a circumstance from which it is to be inferred that the partnership shall continue as long as the lease. On that argument the Court, holding that a lease for seven years is proof of partnership for seven years, and a lease of fourteen of a partnership for fourteen years, must hold that if the partners purchase a fee simple, there shall be a partnership for ever. It has been repeatedly decided that interests in land purchased for the purpose of carrying on trade are no more than stock in trade." (d)

Partnerships

continued after

their terms are

Further, where a partnership, originally entered into for a certain number of years, is continued after their expiration, and there is no evidence as to the additional time for which the partnership was to last, it is treated expired. as having become a partnership at will, and not as having been renewed for another definite period. (e)1

Duration of sub

So, if one of several partners forms a sub-partnership with a stranger, the fact that the principal partnership has been entered into for a certain number of years is no partnerships. evidence that the sub-partnership was intended to last for the same

(c) Featherstonhaugh v. Fenwick, 17 Ves. 307; Jefferys v. Smith, 1 Jac. & W. 301; Alcock v. Taylor, Taml. 506; Burdon v. Barkus, 3 Giff. 412, and on appeal, 4 De G. F. & J. 42.

(d) Crawshay v. Maule, 1 Swanst. 509. (e) Featherstonhaugh v. Fenwick, 17 Ves. 307; Booth v. Parkes, 1 Moll. 465.

A partnership is none the less ended because the party who, upon final settlement, turned over to the other as cash certain drafts and notes, is to be responsible for his proportion of the debts uncollected thereon, or is afterwards employed by the other in making collections; nor because any specific property

of the firm remains unsold, wherein each under the settlement, retains his proportionate share. Sharpe v. Johnston, 59 Mo. 557.

In such case, the one employed as collector may be held criminally for embezzlement of proceeds of such drafts or notes converted to his own use. Sharpe v. Johnston, sup.

By a contract of dissolution, it was provided that one partner was to withdraw, and be paid a proportion of the profits when the estimates were made: Held, that such a one was a partner until the estimates were made. Magill v. Merrie, 5 B. Mon. 168.

number of years, or for as many of them as were unexpired when the sub-partnership was formed. (ƒ) On the other hand, in Wheeler v. Van Wart (g), a company, the duration of which was not expressly fixed, was held to Implied terms of duration. be intended to last at least until after a day appointed in its deed of settlement for the holding of a general meeting. And in Reade v. Bentley (h), it was considered that an agreement to the effect that a publisher should defray the expenses of a work written

by an author, and should receive a percentage on the gross *220 amount of sale, and that the net profits of each edition *should be divided equally between both parties, amounted to an agreement for a joint adventure between the author and the publisher for so long as might be necessary to dispose of a complete edition; and that the publication of every new edition prolonged the partnership until that edition should be disposed of; but that when any edition was exhausted either party was free to discontinue the joint adventure.

SECTION II.-OF THE CAUSES OF THE DISSOLUTION OF AN ORDINARY PARTNERSHIP.

Disregarding mutual consent on the part of all the partners,' and Causes of dis- such events, if any, as by the partnership articles may be specially made grounds for a dissolution, the causes

solution.

(f) Frost v. Moulton, 21 Beav. 596. (g) 9 Sim. 193, and better in 2 Jur. 252.

(h) 4 K. & J. 656; and 3 ib. 271.

1 Where articles of co-partnership provided for an annual account to be taken, and the payment to each partner of his share of the net profits, and just before the expiration of the year a dissolution was agreed upon, in which it was stipulated in writing that an account should be taken between the parties, to include only moneys drawn by the parties since "the last preceding settlement," as provided in the articles of co-partnership: Held, that the subsequent agreement must be construed with the original ar

ticles, and when considered with them required the account to include all of the individual accounts of each partner, whether for moneys received or drawn out, or for any other indebtedness to the firm. Scroggs v. Cunningham, 81 Ill. 110.

A provision in an agreement for the dissolution of a partnership, authorizing one of the partners alone "to sell and dispose of the property and assets of the co-partnership, and to settle all its concerns, collect all bills, notes or bookdebts due the concern, and for that purpose, or for any other purpose legally connected therewith, to use the co-partnership name," confers upon such part

of a dissolution of an ordinary partnership may be reduced to the following, viz:

2. The impossibility of going on; in consequence of The hopeless state of the partnership business. Insanity.

Misconduct and destruction of mutual confidence.

3. The transfer of a partner's interest.

5. The occurrence of some event which renders the continuance of the partnership illegal.

6. Fraud, vitiating the original contract.

The right to rescind a contract of partnership on the ground of fraud will be considered hereafter, in the Third Book. In the present place the other causes of dissolution will alone be adverted to.

1. Will of any partner.

Any member of an ordinary partnership, the duration of which is indefinite, may dissolve it at any moment he pleases,' Dissolution and the partnership will then be deemed to continue by notice.