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who possess the legislative power will that it shall be, unless they express their determination to that effect, in the mode pointed out by the instrument which invests them with the power, and under all the forms which that instrument has rendered essential." Cooley, Const. Lim. p. 155, chap. 6. It is true, as contended, that legislation for certain limited purposes by means of resolutions or legislative orders is in use to some extent in certain of the states and in Congress. But it will be found that in most, if not all, instances, it is under a Constitution which either expressly recognizes it, as does the Constitution of the United States, or one which at least does not forbid it. And it will be usually found to take the form of a resolution, requiring the assent of the executive to give it effect. In Congress this form of legislation is regarded as a bill, and treated with the same formalities. Even if this mode of legislation were competent under our Constitution, the resolution relied upon would not arise to the dignity of law, since it lacks the essential of executive approval. In Collier & C. Lithographing Co. v. Henderson, 18 Colo. 259, under a Constitution containing restrictions similar to those found in that of California, it was held that a resolution adopted by both houses of the legislature for a purpose not dissimilar in principle from that intended to be subserved by the one under consideration was not "a law of the state," as it "was not passed by bill." And see People v. Toal, 85 Cal. 333. The case of Miller v. Dunn, 72 Cal. 462, is cited by appellant as authority for the proposition that the language "express authority of law" is not confined in its meaning to a statute law enacted in the manner prescribed in the Constitution. But in that case the statute under which the contract was made and the service performed had in fact been passed with all the formalities requisite under the Constitution to a valid law, and it was held that such an act, although unconstitutional, was nevertheless a "law" in the sense that it would support an appropriation to pay for the work done under color of its apparent grant of authority, and before its invalidity had been declared by the courts. In this case the legislature did not pretend to follow the formal requirements of the Constitution in its attempt to grant authority for the contract, and its action lent no color of regularity to plaintiff's employment. Moreover, we are not disposed to extend the doctrine announced in Miller v. Dunn. The case of Brooks v. Fischer, 79 Cal. 173, 4 L. R. A. 429, merely holds that under § 8 of art. 11 of the Constitution, a city charter adopted by the freeholders of a municipality may be approved by a concurrent resolution of the two houses of the legislature, without the consent of the executive, because that provision only requires the assent of the "legislature," and does not contemplate the passing of an act for the purposes of such approval; it being expressly held 34 L. R. A.

"that the legislature is one thing and the lawmaking power of the state another." It is not authority for the proposition that the legislature can enact "laws" without submitting them to the governor for his consent.

There is no merit in the claim that the employment of plaintiff was authorized by § 380, subd. 5, of the Political Code, which, in defining the powers of the governor, provides that "whenever any suit or legal proceeding is pending against this state, or which may affect the title of this state to property, or which may result in any claim against the state, he may direct the attorney general to appear on behalf of the state, and may employ such additional counsel as he may judge expedient." That provision has no application to the facts of this case. The action of the governor was not attempted to be taken under that section, nor is the action brought upon any such theory. The complaint does not aver that plaintiff was employed as counsel, or even that he was an attorney at law, and so eligible for the character of employment there provided for. He was employed as a mere agent. While an attorney might be employed as agent, one not an attorney could not be employed for the service contemplated in that section. Nor is there anything in the point that the state is now estopped from denying the validity of the contract with plaintiff, since he has in good faith performed the service. The question of equity or good faith cannot affect our consideration in this case. It is not like a transaction between private individuals. As suggested in Miller v. Dunn, supra: "There is no moral obligation on the part of the state which can be enforced upon equitable principles, nor does the good faith of the party dealing with the state cut any figure in the case, if, in fact, the work was done 'without express authority of law,' for this provision was placed in the Constitution to cut off all claims based upon mere good faith and equity." And says Mr. Bishop:

The government is never estopped, as an individual or private corporation may be, on the ground that the agent is acting under an apparent authority which is not real; the conclusive presumption that his powers are known rendering such a consequence impossible. So that the government is bound only when there is an actual authorization.' Bishop, Cont. § 993. One dealing with public officers is charged with the knowledge of, and is bound at his peril to ascertain, the extent of their powers to bind the state for which they seem to act. And, if they exceed their authority, the state is not bound thereby to any extent. Throop, Pub. Off. § 551. See also State v. Horton, 21 Nev. 466.

We think the demurrer was properly sustained, and the judgment is affirmed.

We concur: Harrison, J.; Garoutte, J..

(In Banc.

and the deceased, John Levinson, were part

H. W. PHILBROOK, Admr., etc., of Johnners in the merchandise business, and held Levinson, Deceased, Appt.,

V.

William J. NEWMAN et al., Respts.

(.... Cal......

interests therein in proportion to the amount of capital invested by each. The last articles of copartnership between these parties were entered into January 24, 1889; and, among other things, they provided in detail the manner in which an inventory and appraisement 1. The basis for fixing the purchase of the partnership business should be taken price of a deceased partner's interest annually, which inventory and appraisement is fixed by articles of partnership at the inven- should form the basis in estimating the net tory and appraisement provided for therein to profit going to each partner. The articles. be taken annually as the basis of estimating further provided as follows: "In the event profits, where the articles further provide that of the death of one of the copartners the inin the event of the death of one partner "the in-ventory provided for herein shall be taken as ventory provided for herein shall be taken as expeditiously as possible, and without un expeditiously as possible," allowing a representative of the estate to participate in the business necessary delay. The surviving partners, if until all is settled, and providing that the amount requested so to do, shall admit to the place ascertained to be due the estate shall be paid in of business of the firm at least one person setwelve equal monthly instalments, but giving lected, designated, and empowered by the the surviving partners an option to continue the heirs or legal representatives of the deceased partnership with the estate of the decedent as a partner to represent the interest of his estate member. [Court equally divided on this point.] in the copartnership. Such person so repre2. A contract is not void as allowing senting the interests of the estate of the desurviving partners to fix their own ceased partner shall have accorded to him purchase price of the interest of a deceased access to all the books, papers, and accounts partner when it permits a representative of his of the firm, and may, at his election, remain estate to participate in the inventory, fixes a defi- and continue at the place of business thereof nite amount for the value of store and office fix- until all matters relating to the interests of tures, and provides that the merchandise shall be the deceased partner shall have been fairly taken at its actual value, not exceeding the origi- and satisfactorily arranged and settled and adnal cost, and solvent debts taken at their face justed, and the total amount due to the estate of the deceased partner shall have been ascer3. The goodwill of the business passes tained and determined. The total amount as to surviving partners upon their purchase certained and determined to be due the estate of the interest of the deceased at its inventoried of the deceased partner on account of his inand appraised value, under a provision of articles of association giving them and their succes-terest in the copartnership shall be paid to sors the right and privilege of continuing the the heirs or legal representatives of the deceased partner in twelve successive and equal monthly instalments, commencing within one month from the time the amount due has been ascertained and determined; for the amount of which instalments the surviving partners. shall execute and deliver to such heirs or legal representatives their promissory notes, payable as aforesaid, without interest, and satisfactorily secured by indorsement or otherwise; provided, however, that the surviv ing partners shall have the option to continue the said copartnership; the estate of the deceased partner taking the place of the decedent on such terms and conditions as may

value.

business under the firm name.

4. Legatees of full age, who demand and compel a distribution to them of the proceeds of a sale by an executor of the interest of a deceased partner, although protesting at the same time that they do not admit that this is all that is due, thereby ratify the sale, and cannot afterwards deny the executor's power to make it, or claim anything additional on account of the goodwill of the business for which nothing was received. [Per Beatty, Ch. J., Henshaw and Temple, JJ.]

(November 5, 1896.)

APPEAL by plaintiff from an order of the
Superior Court for the City and County of
San Francisco in favor of defendants in a pro-
ceeding brought to compel an accounting of
the affairs of the partnership of which plain-
tiff's testator was a member. Affirmed.

The facts are stated in the opinions.
Mr. H. W. Philbrook for appellant.
Messrs. Reinstein & Eisner and E. R.
Taylor for respondents.

Garoutte, J., delivered the opinion of the

court:

William J. Newman, Benjamin Newman, NOTE. As to the rights of surviving partners to carry on business, see also Stewart v. Robinson (N. Y.)5 L. R. A. 410, and note; Valentine v. Wysor (Ind.) 7 L. R. A. 788, and note.

As to transfers of goodwill, including the name of the establishment, see Vonderbank v. Schmitt (La.) 15 L. R. A. 462, and note.

be agreed upon between the surviving pat ners and the legal representatives of the deceased partner, but it shall not be obligatory upon the surviving partners so to do. The surviving partners and their successors shall also have the right and privilege of continuing the business under the said designation and name of Newman & Levinson."

Levinson died February 25, 1890, and forthwith the Newmans made an inventory and appraisement of the partnership business, as provided by the articles of partnership, by which inventory and appraisement it was determined that the net amount of Levinson's

As to goodwill of partnership, see Brass & I.. Works Co. v. Payne (Ohio) 19 L. R. A. 82, and Knoedler v. Glaenzer (C. C. App. 2d C.) 20 L. R. A. 733.

sentially one in equity, sounding largely in fraud, and asking for an accounting of the partnership affairs. The case has been before us in the past upon an appeal from the judgment (107 Cal. 602), where may be found an outline of the purposes of the action and the general framework of the pleadings.

interest in the assets of the firm was the sum | plaintiff of record herein. This action is esof $20,790.88. For this amount defendants prepared, and procured to be properly in dorsed, their notes, twelve in number, for the sum of $1.732.57 each, bearing date February 26, 1890, payable at successive monthly intervals following that date, and within one month after Levinson's death tendered them to Raveley, the executor of the will of said deceased, who had then received letters testamentary from the superior court. In July, 1890, the Newmans filed a petition in the court, alleging that they were ready and willing to purchase the interest of the deceased in the partnership upon the terms stated in the articles, and had requested the executor to allow them to do so; that he had refused; and praying an order directing him to convey that interest to them. The court sustained a demurrer to such petition, on the ground that it had no jurisdiction to grant the order prayed for. Thereafter, on Sep. tember 6, 1890, Raveley, the executor, being of the opinion that he had the power to accept the terms proposed by the Newmans, received the said notes, and on that day executed to them two certain papers, the first of which acknowledged the delivery of the notes "in pursuance of the provisions of the articles of partnership for the interest of the estate of said Levinson in said partnership." The other paper set out the transaction more in detail, and stated that the amount of such notes was the amount of Levinson's interest in the assets of the firm, as determined by the said inventory and appraisement, and that the notes were received by the executor "in full payment and satisfaction of the amount due the estate of John Levinson, deceased, for the interest of said deceased and of his said estate in the copartnership firm as the same has been ascertained, as above stated." Levinson's residuary lega. tees were his mother and two sisters, all of full age. They, in writing, notified the Newmans on March 5, 1890, that they did not desire to employ any person to assist in taking the inventory of the assets of the late firm, then in progress, and the estate of the deceased had no representative in that undertaking, though the executor was often about the place of business, and both he and the legatees knew what was being done. No account of the goodwill of the firm was taken in the inventory made by the defendants, nor was it in the inventory and appraisement of the estate returned to the court by the executor. In the inventory and appraisement returned by the executor the value of the interest of Levinson in the partnership assets was stated at the same sum as that fixed by the appraisement of the defendants, to wit, $20,790.88, and was adopted by the apprais ers on the strength of that appraisement. The omission to value the goodwill as part of the estate by the executor was resented by the legatees, and on this ground they petitioned the court to remove Raveley from his office of executor. He thereupon resigned; his accounts were settled; successive administrators with the will annexed carried on the administration, until finally H. W. Philbrook was appointed, and he has been substituted as

Fraud is charged in the body of plaintiff's bill, and upon that ground relief in a great measure is sought. But in the opinion of the trial judge Hon. W. T. Wallace, which opinion is set forth in the record, it is stated that there is no evidence whatever to support such a charge. And, after a careful examination of the evidence, we find nothing therein even tending to show the practice of any fraud upon the heirs and legatees of the dead partner. It follows that all question of fraud is out of the case, and the only important question remaining is: Had the executor, under the articles of copartnership, the right to consummate the transfer of the deceased partner's interest in the business to the surviving partners for the consideration specified in said articles? Although this interrogatory presents a clear-cut proposition of law, still it is well to say that, if this transfer of the partnership interest should be set aside, as is here sought by appellant, and all parties be placed in statu quo, as of the day the transaction was had, no substantial results favorable to appellant's interests would ensue. It would be a valueless victory, for, as said by the trial judge, upon an accounting the sum realized by the legatees would fall far short of the amount actually paid by the surviving partners to them. In appellant's brief the law is conceded to be: "Where the copartners in the partnership contract-articles of partnership-do actu ally contract that on the death of a partner the partnership property and business belongs to the survivor or survivors, fixing the price at which it is to be taken by the survivor or survivors, such contract is binding according to its terms." Upon such concession we are brought face to face with the articles of copartnership for the purpose of weighing and testing them by the formula furnished by appellant; and at the threshold of the investigation we are met by the objection that, at the date when those articles were entered into, the deceased partner, Levinson, was incapable, by reason of mental incapacity, of entering into any contract whatever. The mental incapacity of Levinson at the time was not even suggested in plaintiff's bill, and his mental status does not appear to be an element of the case that attracted serious attention at the trial. But some evidence came before the court upon the question without objection, which, even in the absence of direct issues raised by the pleadings, should be considered as bearing upon the question. Crowley v. City R. Co. 60 Cal. 628. There are various good reasons why this evidence should not be held sufficient to invalidate the articles of copartnership, and as an all-sufficient reason we suggest that the implied finding of the court was against any such contention. Appellant's principal witness to the point testified

that, if Levinson had read the articles of co- | and explicit to be capable of enforcement. partnership, he would have understood them, There is no case cited by appellant that goes and there is no evidence in the record that to the length here insisted upon. But, upon he did not read them. As a salient circum- the contrary, that is certain which may be stance bearing upon Levinson's mental capaci- made certain, and many of the cases bearing ty at that particular time, it may be noticed upon this question rest upon this principle. that some few days thereafter he executed his Numberless cases might be cited where courts last will and testament, the will under which have recognized the right of the partners to this administrator is now acting in prosecut- stipulate in the copartnership articles that ing this litigation. It further appears that, the purchase price for the interest of a deupon his return from Europe after the exe- ceased partner shall be fixed by an inventory cution of these articles, for several months, and appraisement to be taken after the death and up to the time of his death, he gave his of such partner. In the very nature of things, personal attention to the business of the firm, a fair purchase price of an interest in the firm as he had always done in the past. We are at an indefinite future time would be incapsatisfied there is nothing in the point. able of ascertainment. To fix the amount in advance would be simply a speculative gamble upon the part of all parties concerned, and hardly justifiable either in morals or law.

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We have quoted in detail that portion of the partnership contract which declares what shall be done with the business in case of the death of one of the partners. In this respect the provision of the contract is not well It is further contended that there is no drawn. It is not clear, but, upon the con- mode whatever provided in the articles by trary, somewhat vague and indefinite. At which to ascertain the value of the interest the same time, when carefully read and con- of the deceased partner; and it may well be sidered, but one conclusion can be arrived conceded that the provisions of the contract at; and that is that, upon the death of one in this regard are not what they should be. of the partners, the surviving members of In this particular the instrument is unhapthe firm had at least the privilege and option pily drawn, and well serves the purpose of of buying the interest of the deceased partner being an invitation for litigation. As we in the business upon certain terms. It is have already seen, the articles provide for claimed upon the part of the Newmans that an annual inventory and appraisement, in under the contract they were bound to do so. order that the actual financial status of the But to support the validity of the contract concern may be determined. This inventory in this regard they are not compelled to go and appraisement was provided for in order to such length; for, if they had an option that the annual profit or loss of each partner by the articles of copartnership to purchase might be known. A succeeding subdivision upon stated terms, then they had the un- of the contract, which we have heretofore doubted right to exercise that option, and quoted in full, then in part declares: take the interest of the deceased partner, if the event of the death of one of the copartthey were so disposed. Harbster's Appeal, ners, the inventory provided for herein shall 125 Pa. 3. In that case it is said: "It re- be taken as expeditiously as possible, and quires no argument to show that the interest without unnecessary delay. The surviving of the deceased partner ended when the firm partners, if requested so to do, shall admit gave notice that they would take it in ac- to the place of business of the firm at least cordance with the terms of the agreement. one person selected by the heirs or And in the case at bar, if the Newmans sim-legal representatives of the deceased partner, ply held an option to purchase the interest, to represent the interest of his estate in the there can be no question but that they exer- copartnership, and may at his eleccised that option in favor of purchasing. tion remain and continue at the place of If it should be held that the copartnership business thereof until all matters relating articles did not give the surviving partners to the interest of the deceased partner and a right to purchase, then the presence of all his estate shall have been fairly and satisthat portion of the contract providing for the factorily arranged and settled and adjusted, mode and manner of payment by the New- and the total amount due to the estate of the mans for the deceased partner's interest would deceased partner shall have been so deterbe inexplicable. It is provided in great mined. The total amount ascertained and detail that they should give their equal determined to be due the estate of the demonthly instalment notes, running over a ceased partner on account of his interest in period of twelve months, in payment of the the copartnership shall be paid to the heirs interest of the deceased partner. Such pro- or legal representatives of the deceased partvision beyond question contemplated a sale, ner in twelve successive and equal monthly and that a sale to the surviving partners in instalments." If the language of the concase of the death of one of the firm was in tract had included the words and appraisethe minds of all parties when the contract ment" after the word "inventory." there was made, does not admit of doubt. There would have been no question of indefinitecan be no other reasonable construction of ness, and no possible technical objection as the contract. to the matter of construction. But the absence of those two words should not nullify the contract. It would be carrying the doctrine of technicality too far, if we should so hold. The true intent of the parties is plainly apparent from the language used. And that intent was that an inventory and

It is insisted that the language here used provides no fixed and definite amount of money to be paid by the surviving partner for the interest of the deceased partner, and it is claimed that for such reason there is no contract, at least no contract sufficiently clear

(c)

appraisement, as provided for in the articles, | be determined, if necessary, by arbitration. should furnish the basis for fixing the purchase price of the deceased partner's interest. Such is the fair construction of the language, taking it altogether, and, indeed, the only construction which can be given it. To say that the parties to the contract, while providing for a sale, and also providing for the manner and time for payment, never intended to provide as to the amount which should be paid, or to fix any mode by which the amount could be determined, would be going to lengths entirely unauthorized by the instrument itself. We hold that the mode and manner of fixing the amount of the purchase price are found within the language of the instrument itself, and that mode and manner is the inventory and appraisement provided for in a previous portion of the contract.

Rejected machinery or any other property or merchandise for which the firm is not willing to allow the valuation inventoried, or herein before provided for, at the price offered by the highest bidder. (d) For the stereo and electrotype plates, engravings, a sum equal to the gross profits of the firm for the last two complete business years preceding the time of settlement. " It was not suggested that such a character of valuation avoided the contract, although the case was bitterly contested on other grounds. The case of Simmons v. Leonard, 3 Hare, 581, goes away beyond the cases just cited. It was there provided that the surviving partners should take the interest of the deceased partner at a valuation shown by the last annual accounting, the articles having provided for annual accounts. A partner died, and no annual accounts had been taken. The representative of the deceased partner, as in this case, contended that there could be no sale, as the purchase price was not fixed. The vice chancellor said: "The rule which jus tice and common sense would apply in such a case is, I think, too clear for serious argument, the proviso for sale in one event, that of the term running out, and the proviso for in-paying out a deceased partner's share (dying during the term) by instalments, is conclusive evidence of an intention and agreement, that the death of a partner during the term should not work a dissolution of the whole partnership, but that the survivors should have a right to carry it on, with the accommodation of paying off the executors of a deceased partner by instalments." And, in conclusion, he held the contract for a sale good, and that the purchase price should be determined by an accounting.

Conceding that the inventory and appraise ment mentioned in the articles of copartnership were intended by the partners to be used as the basis for fixing the value of a deceased partner's interest, then appellant contends that the contract was void as placing it in the power of the surviving partners to fix their own purchase price. There is no force in this contention. The contract contemplates the presence of a representative of the deceased partner during all these times, and cidentally it may be suggested that the executor was present during the time, more or less, and that both he and the legatees had full knowledge of what was being done, and ample opportunity to be present at all times and upon all occasions, to assist either per. sonally or by agent. Again, as to the store and office fixtures, the value is fixed at a certain and definite amount. As to the stock of merchandise on hand, it is to be appraised at its actual value, but not to exceed its original cost. All solvent debts are to be taken at their face value. We see nothing so indefinite in these facts as to nullify the contract. The actual value of a piece of mer chandise can be determined, and likewise it can be determined what is and what is not a solvent account. They are matters capable of ascertainment, and every partnership in the country is constantly engaged in deter mining them. There is certainly nothing so indefinite and uncertain as to the valuation to be fixed upon these assets as to in any way render the contract nugatory. In Harbster's Appeal, cited by appellant, the purchase price was fixed at the previous annual appraisement, with the proportion of profit or loss for the present year added or deducted, as the case might be. It certainly in that case was no easier to fix the amount of the profit or loss than it was in this case to fix the actual value of the stock, or determine what debt was a solvent account. Indeed, both of those factors of the business were necessary elements to be determined before the profit or loss could be fixed. In another of appellant's cases-Blake v. Barnes, 26 Abb. Ñ. C. 208, -the purchase price by the surviving partners upon the death of a member of the firm was to be determined by an inventory and appraisement to be made as follows: "(b) Accounts overdue at a fair estimate, to

In Dinham v. Bradford, L. R. 5 Ch. 519, it is held, in effect, that the articles of copartnership might provide that the purchase price of a deceased partner's interest in the business should be fixed by three disinterested parties. In Quinlivan v. English, 44 Mo. 46, the value of the interest of a deceased partner was to be fixed by an appraisement made after his death, and, in case of a dispute as to the valuation of the stock, the matter was to be submitted to three arbitrators. The court held such an agreement valid and binding. Indeed, it may be suggested that the authorities are practically unanimous that any question of indefiniteness or uncertainty as to the amount of the purchase price, or the manner or mode in which such price is to be arrived at, in no way affects the right of the surviving partners under the partnership contract to buy. And it is held in many cases that such conditions only result in casting the burden upon the trial court to take an accounting and fix the price. We conclude that the contract is valid and binding in all respects; that the amount of the purchase price for the deceased partner's interest in the business was fixed by the articles with such sufficient certainty as to deny the court the right to hold a general accounting. And, in the absenceof a showing of fraud, to some extent at least, in the making of the inventory and appraise

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