If, however, in the terms of dissolution of a partnership, one partner be authorized to use the name of the firm in the prosecution of suits, he may bind all by a note for himself and his partners, in a matter concerning judicial proceedings.*

(8.) Dealing on separate account.

The business and contracts of a partner, distinct from, and independent of, the business of the partnership, are on his own account; and yet it is said, that one partner cannot be permitted to deal on his own private account in any matter which is obviously at variance with the business of the partnership, and that the company would be entitled to claim the benefit of every such contract. The object of this rule is to withdraw from each partner the temptation to bestow more attention, and exercise a sharper sagacity, in respect to his

own purchases and sales, than to the concerns of *52 the partnership in the same line of business.

The rule is evidently founded in sound policy; and the same rule is applied to the case of a master of a vessel, charged with a cargo for a foreign market, and in which he has a joint concern.c But a per

son may become a partner with one individual of a partnership, without being concerned in that partnership; for though A. & B. are mercantile partners, A.

a Burton v. Issit, 5 Barnw. & Ald. 267.

» Pothier, Traité du Con. de Soc. No. 59. Glassington v. Thwaites, 1 Sim. & Stu. 133. Featherstonhaugh v. Fenwick, 17 Vesey, 298. Burton v. Wookey, Madd. & Geld. 367. 6 Madd. R. 367. Russell v. Austwick, 1 Sim. R. 52. Fawcett v. Whitehouse, 7 Russell & Mylne, 132. 148. In the case from Vesey, one partner had secretly, for his own benefit, obtained a enewal of the lease of the premises where the joint trade was carried on, and the lease was held to be a trust for the benefit of the co-partnership. See infra, vol. iv. 371.

с

Boulay Paty, Cours de Droit Com. tome ii. 94.

may form a separate partnership with C., and the latter would have no right to a share in the profits, nor would he be bound for the engagements of the house of A. & B. because his partnership would only extend to the house of A. & C. But such involved partnerships require to be watched with a jealous observation, and especially if they relate to business of the same kind, inasmuch as the attention of the person belonging to both firms might be distracted in the conflicts of interest, and his vigilance and duty in respect to one or the other of the concerns become much relaxed. Partners are bound to conduct themselves with good faith, and to apply themselves with diligence in the business of the concern, and not to divert the funds to any purpose foreign to the trust.b

Ex parte Barrow, 2 Rose's Cases in Bankruptcy, 252. Glassington v. Thwaites, 1 Sim. & Stu. 124. 133. Lord Eldon there refers to the case of Sir Charles Raymond, as containing the doctrine. It was also the doctrine of the civil law, and is the law of those countries which follow the civil law. Socii mei socius, meus socius non est, Dig. 17. 2. 20. Pothier, Traité du Con. de Soc. No. 91. Ersk. Inst. vol. ii. 6. 3. sec. 22. Bell's Com. vol. ii654. Civil Code of Louisiana, art. 2842. There can be no doubt, said Lord Ch. J. Eyre, 1 Bos. & Pull. 546, that, as between themselves, a partnership may have transactions with an individual partner, or with two or more of the partners, having their separate estate engaged in some joint concern, in which the general partnership is not interested; and that they may convert the joint property of the general partnership into the separate property of an individual partner, or into the joint property of two or more partners, or e converso. See, also, Gow on Partnership, p. 75. Collyer on Partnership, pp. 175-178. Story on Partnership, p. 320

Long v. Majestre, ibid.

Stoughton v. Lynch, 1 Johns. Ch. Rep. 470. 305. Faucett v. Whitehouse, 1 Russ. & Mylne, 132. Collyer on Partnership, 96. If the partnership suffers loss from the gross negligence, unskil fulness, fraud or wanton misconduct of a partner, in the course of their business, or from a known deviation from the partnership articles, he is ordinarily responsible over to the other partners for all losses and damages sustained thereby. Maddeford v. Austwick, 1 Sim. R. 89. Societé, n. 133. Story on Partnership, 261–267.

Pothier, de

III. Of the dissolution of partnership.

If a partnership be formed for a single purpose or transaction, it ceases as soon as the business is completed; and nothing can be more natural and reasonable than the rule of the civil law, that a partnership in any

business should cease when there was an end put *53 to the business itself. If the *partnership be for a definite period, it terminates of course when the period arrives. But in that case, and in the case in which the period of its duration is not fixed, it may terminate from various causes, which I shall now endeavour to explain, as well as trace the consequences of the dissolution.

A partnership may be dissolved by the voluntary act of the parties, or of one of them, and by the death, insanity or bankruptcy of either, and by judicial decree, or by such a change in the condition of one of the parties as disables him to perform his part of the duty. It may also be dissolved by operation of law, by reason of war between the governments to which the partners respectively belong, so as to render the business carried on by the association impracticable and unlawful.b

(1.) Dissolution by the voluntary act of either partner. It is an established principle in the law of partnership, that if it be without any definite period, any partner may withdraw at a moment's notice, when he pleases, and dissolve the partnership. The civil law

■ Inst. 3. 26. 6. Extincto subjecto, tollitur adjunctum. Pothier, Traité du Con. de Soc. Nos. 140-143, illustrates this rule in his usual manner, by a number of plain and familiar examples. 16 Johns. Rep. 491. S. P.

sec. 6.

Inst. 3. 26. sec .7, 8. Vinnius, h. t. 3. 26. 4. Hub. in Inst. lib. 3. tit. 26. Pothier, Traité du Con. de Soc. Nos. 147, 148. 11 Vesey, 5. 1 Swanst. Rep. 480. 508. 16 Johns. Rep. 491.

• Peacock v. Peacock, 16 Vesey, 49. Featherstonhaugh v. Fenwick, 17 Vesey, 298. Lord Eldon, in 1 Swanst. Rep. 508.

contains the same rule on the subject.

The existence

of engagements with third persons does not prevent the dissolution by the act of the parties, or either of them, though those engagements will not be affected, and the partnership will still continue as to all antecedent concerns, until they are duly adjusted and settled. A reasonable notice of the dissolution might be very *advantageous to the company, but it is not requi- *54 site; and a partner may, if he pleases, in a case free from fraud, choose a very unseasonable moment for the exercise of his right. A sense of common interest is deemed a sufficient security against the abuse of the discretion. Though the partnership be constituted by deed, a notice in the gazette by one partner, is evidence of a dissolution of the partnership as against the party to the notice, even if the partnership articles require a dissolution by deed.

But if the partners have formed a partnership by articles, for a definite period, in that case it is said, that it cannot be dissolved without mutual consent before the period arrives. This is the assumed principle of law by Lord Eldon, in

Inst. 3. 26. 4. Code, 4. 37. 5.

• Pothier, Traité du Con. de Soc. No. 150, says, that the dissolution by the act of a party ought to be done in good faith, and seasonably-debet esse facta bona fide et tempestive. He states the case of an advantageous bargain for the partners being in contemplation, and one of them, with a view to appropriate the bargain to himself, suddenly dissolves the partnership. A dissolution at such a moment, he justly concludes, would be unavailing. This general rule was also the doctrine of the civil law, Inst. 3. tit. 26. Dig. 17. 2. 65. 4. Domat, b. 1. tit. 8. sec. 5. Code Civil of France, art: 1869. 1870, 1871, Code of Louisiana, art. 2855 to art. 2859. 2 Bell's Comm. 532, 533. District Court of Maine, Feb. 1846, United States v. Jarvis.

17 Vesey, 308, 309.

Doe and Waithman v. Miles, 1 Starkie's N. P. 181. Collyer on Part. 154. Story on Partnership, 390.

• Gow on Partnership, 303. 305. edit. Phil. 1825.

Peacock v. Peacock, and in Crawshay v. Maule, and by Judge Washington, in Pearpoint v. Graham; and yet, in Marquand v. New-York Man. Company, it was held, that the voluntary assignment by one partner of all his interest in the concern, dissolved the partnership, though it was stipulated in the articles that the partnership was to continue until two of the partners should demand a dissolution, and the other partners wished the business to be continued, notwithstanding the assignment. And in Skinner v. Dayton,e it was held by one of the judges,f that there was no such thing as an indissoluble partnership. It was revocable in its own nature, and each party might, by giving *due notice, dissolve the partnership as to all future capacity of the firm to bind him by contract; and he had the same legal power, even though the parties had covenanted with each other that the partnership should continue for such a period of time. The only consequence of such a revocation of the partnership power in the intermediate time, would be, that the partner would subject himself to a claim of damages for a breach of the covenant. Such a power would seem to be implied in the capacity of a partner, to interfere

#55

In Bishop v. Breckles, 1 Hoffman's Ch. R. 534, it was considered to be rather doubtful whether either party might dissolve the partnership at pleasure upon due notice, and yet the rule of the civil law was deemed the most reasonable. But Mr. Justice Story, in his Commentaries on Partnership, p. 397, considers it quite unreasonable to allow a partner to dissolve the part. nership sua sponte from mere caprice, and to the great injury of the concern, and that it ought not to be done except under reasonable circumstances. See infra, p. 61.