should be observed that, as a partner's own interest in the copartnership property is his due proportion of a residue to be found upon a final balance, he can hardly transfer his own interest in the partnership stock effectually to a stranger without dissolving the partnership altogether.1

As a general rule, and with but rare exceptions on familiar principles as to a bona fide purchaser or transferee for value without notice, the purchaser, pledgee, or transferee of one partner's interest can acquire no title to assets beyond the latter's share in such surplus as may remain upon a winding up of the firm business; 2 and where a partner thus disposes of firm personalty without the knowledge of his copartners and in fraud of their rights, for his individual debt, the purchaser is held to acquire no full title thereto as against the partnership creditors.3

The admissions, representations, and misrepresentations of a partner are binding on the firm, provided they relate to and are made in the course of the partnership business and within its proper scope and contemporaneously. And even the acknowledgment of an existing debt by a single partner, while the partnership continues, will take the case out of the Statute of Limitations; though on principle such an acknowledgment made after the partnership is dissolved can have no such effect. One partner cannot, in the absence of usage or special circumstances, bind the firm by the

zer v. Mead, 5 Mich. 107; Reid v. Hollinshead, 4 B. & C. 867; s. c. 7 D. & R. 444. As to a mortgage, the necessity of formalities under seal may sometimes affect the question. A partner may assent to the transfer of a partnership debt from one banker to another. See Beale v. Caddick, 2 H. & N. 326; Arnold v. Brown, 24 Pick. 89; Winship v. Bank of United States, 5 Pet. 561.

1 Pars. Partn. § 306; 11 Barb. 140; Tarbell v. West, 86 N. Y. 280. See § 185, note.

2 Staats v. Bristow, 73 N. Y. 264. 8 This rule applies most strongly if the transferee was cognizant of the

fraud. But even the transferee's innocence will not here avail him. Tarbell v. West, 86 N. Y. 280; Liberty Savings Bank v. Campbell, 75 Va. 534; Forney v. Adams, 74 Mo. 138; 59 Ala. 338. And see 37 Ark. 228; Hartley v. White, 94 Peun. St. 31. And as to the right of the firm itself to recover such property, see Johnson v. Crichton, 56 Md. 108.

43 Kent Com. 50, 51; Story Partn. § 107; Pars. Partn. §§ 126-129, and notes; Bell v. Morrison, 1 Pet. 351; Shoemaker v. Benedict, 1 Kern. 176; Turner v. Smart, 6 B. & C. 603. See 163 Mass. 527.

guaranty of a third person's debt, nor make his fellowpartners liable as mere sureties without their consent.1

§ 190. Liability of Firm for Fraud, etc., of Partner. — Partnership contracts involving fraud and deceit are closely allied to the law of torts. The rule is that partners are liable in solido for the tort of one, if that tort were committed by the partner as such, and in the course of the partnership business; but not otherwise unless the wrongful act were authorized or adopted by the firm.2 The connivance of copartners in a fraudulent transaction, and their voluntary participation in accruing profits, are circumstances which would justify the court in making all jointly responsible.3 But there are cases which tend to relax the rule of partnership liability somewhat more in torts than contracts, agreeably to the general rules of agency, so as to shield innocent partners who had no actual knowledge of the wrong committed, nor had consented thereto, from the consequences of a partner's misconduct; though this holds true in the case of a pure tort rather than where wrongful transactions grow out of a contract.1

§ 191. Rights and Duties of Partners as between themselves. Thus far we have considered the power of a single

13 Kent Com. 47, and n.; Pars. Partn. §§ 119, 144; Story Partn. §§ 127, 245; Foot v. Sabin, 19 Johns. 154; Rollins v. Stevens, 31 Me. 454; Russell v. Annable, 109 Mass. 72. But as to a guaranty of profits under a sale, see Jordan v. Miller, 75 Va. 442. A guaranty may become binding on the firm by ratification. Clark v. Hyman, 55 Iowa, 14.

A member of a firm cannot confess judgment for a firm debt. Pars. Partn. § 125; 91 U. S. 170. He has

certainly no right to enter appearance for his firm after its dissolution. Hall v. Lanning, 91 U. S. 160. See post as to dissolution.

As to binding one partnership by the acts of another having a common member, see Cobb v. Illinois Central R., 38 Iowa, 601.

One partner may buy goods for the concern, whether for cash or on credit, so as to bind the firm. Johnston v. Bernheim, 86 N. C. 339; 14 Nev. 265. And see Cameron v. Blackman, 39 Mich. 108; 21 Kan. 26.

As to liability of partners for rent under a lease, see Stillman v. Harvey, 47 Conn. 26.

2 Brydges v. Branfill, 12 Sim. 369; Locke v. Stearns, 1 Met. 564; Pars. Partn. §§ 100, 102; Graham v. Meyer, 4 Blatchf. 129; Coll. Partn. Am. ed. § 738; Story Partn. §§ 234, 256.

3 Ib.; Castle v. Bullard, 23 How. 173; Coleman v. Pearce, 26 Minn. 123; Tenney v. Foote, 95 Ill. 99.

4 Floyd v. Wallace, 31 Ga. 688; McKnight v. Ratcliffe, 44 Penn. St. 156.

partner as concerns the public. The rule is quite different when we come to apply it as between the partners themselves; for here the power of a single partner to bind the firm may be and is frequently modified by the partnership agreement. If there be written articles constituting the partnership, the power and authority of the partners inter se must be ascertained and regulated by the terms and conditions of those articles. As between themselves, partners may control and appropriate the firm assets in the adjustment of mutual claims in any manner they may choose.2 Nor as against his copartners, can a partner, without being duly authorized, make, accept, or indorse negotiable paper, unless the act is both within the scope of the partnership business and actually on account of the firm.3 Equity will enjoin one partner from violating the rights of his copartner in partnership matters, although no dissolution of the partnership be contemplated.*

Partners should observe perfect good faith with one another; nor should any member of a firm transact independent business to the material injury of his associates, or otherwise place himself in a situation where his bias is likely to be against the common interests.5 A partner may traffic quite outside the scope of the firm business for his own profit and advantage; but if he secretly engages in the same business by himself, equity will subject his gains to the common benefit of the partnership. Involved partnerships, where one individual connects himself with different firms engaged in the same kind of occupation or business, ought not to be greatly favored; for when one undertakes to serve two rivals who antagonize, he is likely to transfer his affections from one to the other according to the dictates of

1 Kimbro v. Bullitt, 22 How. 256; Story Partn. §§ 169-186, and cases cited.

2 McCormick v. Gray, 13 How. 26.

8 See supra, § 188; Etheridge v. Binney, 9 Pick. 272.

Wall. 339. As to remedies of partners in general, see Pars. Partn. cs. 8-10.

5 Story Partn. §§ 123-125; Pars. Partn. §§ 150-156; Murrell v. Murrell, 33 La. Ann. 1233.

6 Latta v. Kilbourn, 150 U. S. 524;

4 Marble Company v. Ripley, 10 Kimberly v. Arms, 129 U. S. 512.

greedy self-interest rather than of duty. We are told that the Roman lawyers stigmatized that partnership where one tries to reap all the advantages for himself as the societas leonina, in allusion to the fable of the lion who went hunting with the other wild animals, and took all the prey as his own share.1 Each partner owes an amount of time, care, and trouble to the concern commensurate with his interest, or according to the mutual intent of the partnership. One partner ought not to exclude the others from advice or management; though, as controversies must exist even when all have been consulted, it appears to be settled that a majority in interest of the firm acting in good faith may bind the minority in interest.2

§ 192. Dissolution and Change of a Partnership; how effected. Thirdly. As to the dissolution and change of a partnership. A partnership may be dissolved in a variety of ways: by limitation of the period named in the partnership articles; by the voluntary act of all the partners whenever they may choose; often by the act of a single partner, amounting to withdrawal, since partnerships formed without limitation as to time are at will only; by the death of a partner; generally in fact by a change in the firm membership; also by decree

1 Pothier Contr. de Soc. c. 3; 3 Kent Com. 29, 51, 52.

2 Pars. Partn. § 149; Peacock v. Cummings, 46 Penn. St. 434; Kirk v. Hodgson, 3 Johns. Ch. 400; Johnston v. Dutton, 27 Ala. 245; 3 Kent Com. 45, 46; Story Partn. §§ 169, 175. A partner cannot by purchase become the individual owner of an outstanding note against the concern. Easton v. Strother, 57 Iowa, 506. A partner cannot usually charge his firm with interest. Topping v. Paddock, 92 Ill. 92. But one may be entitled to interest on money advanced for the firm's use under fair circumstances. Baker v. Mayo, 129 Mass. 517. As to one's claiming special allowance for services to the firm (which ordinarily is not proper),

cause

see Godfrey v. White, 43 Mich. 171; 8 Daly (N. Y.), 176; Cramer v. Bachmann, 68 Mo. 310; 40 Mich. 457. An attorney repudiating his partnership obligations in a entrusted to his firm cannot claim a share in the fees subsequently earned by his partners. Denver v. Roane, 99 U. S. 355. A partner may, for his delinquency, be chargeable with interest to the firm. 30 N. J. Eq. 540.

The powers of partners are coordinate, whether the partnership is in active operation or subsists only for the purpose of winding up its affairs; and each partner ought to keep precise accounts of all his transactions for the firm, and keep them ready for inspection. 48 Md. 223.

of a court of equity or proceedings in bankruptcy.1 A partnership, or quasi partnership, which has been formed for a single purpose or transaction, ceases as soon as the business is completed. Where the court interferes to pronounce a dissolution, the cause should be a weighty one; for in case of the minor misconduct of a copartner, and general grievances requiring redress, the milder remedy of injunction which puts a stop to further mischief is preferred. A legal adjudication of bankruptcy or of insolvency against either the firm or a partner works a dissolution; but not simple insolvency, or mere inability to pay. Fraud in the original creation of the partnership is ground for judicial dissolution; 5 and so is the culpable misconduct or insanity of a partner, or even an essential change of circumstances if thereby the purposes of the partnership become incapable of fulfilment. Visionary schemes will sometimes be dispelled by the court, and deluded partners released. And of course, where war breaks out, a partnership between citizens of the opposing governments must necessarily come to an end.8 Courts of equity exercise a liberal jurisdiction over granting a dissolution, which is usually for causes arising after the partnership was formed.

13 Kent Com. 53; Pars. Partn. § 280 et seq.; Story Partn. §§ 265-319. 23 Kent Com. 52, 53.

3 Pars. Partn. §§ 206, 207; Howell v. Harvey, 5 Ark. 278; Goodman v. Whitcomb, 1 Jac. & W. 569; Fischer v. Raab, 57 How. (N. Y.) Pr. 87; 17 Ch. D. 529.

4 3 Kent Com. 58-60; Pars. Partn. § 368; Siegel v. Chidsey, 28 Penn. St. 279; Crawshay v. Collins, 15 Ves. 217. Where partnership and individual property are assigned in bankruptcy, the court prefers, as far as practicable, to apply partnership assets to the partnership debts, and individual assets to individual debts. 133 U. S. 670.

5 Hynes v. Stewart, 10 B. Monr. 429; Fogg v. Johnston, 27 Ala. 432.

Story Partn. §§ 291-294; 3 Kent Com. 62; Pars. §§ 360, 361; Harrison v. Tennant, 21 Beav. 482; Claiborne v. Creditors, 18 La. 501.

7 Baring v. Dix, 1 Cox, 213; Beaumont v. Meredith, 3 Ves. & B. 180; 8 Or. 84; Pars. § 357.

83 Kent Com. 62; Griswold v. Waddington, 15 Johns. 57; Pars. § 357. A written agreement for dissolving a partnership supersedes all prior or contemporaneous agreements on the subject. Bragg v. Geddes, 93 Ill. 39. Any partner of a firm formed for an indefinite time may retire and dissolve the partnership whenever he chooses, if his act be bonâ fide. Fletcher v. Reed, 131 Mass. 312; 11 App. Cas. 298. For effect of his assignment, see 135 U. S. 621.