be done in that way. If creditors or any partner objects the court will appoint a receiver, whose duty it will be to sell the assets, pay the creditors and expenses of the receivership, and distribute the surplus among the partners according to their respective in

terests.

§ 222. Where a dissolution results from the death of one of the partners, the surviving partners are clothed by the law with authority to settle the firm's affairs, and the personal representatives of the deceased partner can not meddle with the firm's affairs unless there is mismanagement on the part of the surviving partners. Most of the states have statutes providing for the settlement of the partnership business by surviving partners, requiring them to file inventories in court, to give bond, and to make reports of their doings, as in case of administrators and

executors.

§ 223. Individual and partnership creditors.— Questions arise concerning the conflicting claims of the creditors of the firm and the individual partners to participate in the assets of the partnership, and of the partners individually. The equitable rule is followed in all the courts, that firm creditors must look first to firm assets, and individual creditors to the assets of the individual members of the firm. If there is a surplus of the firm assets after paying firm creditors, and a deficiency of individual assets to pay individual creditors, these creditors may resort to the share of the surplus which would be going to the partner against whom they hold unsatisfied claims; so may firm creditors, after exhausting

firm assets, resort to what may remain of individual assets after the discharge of individual debts.

§ 224. Rights of partners after dissolution.-The dissolution of the firm puts an end to the power of the partners to bind their copartners to any new engagements, except so far as it may be necessary or proper in closing up the firm's business. Where one partner retires and the remaining partners assume the firm debts, the retiring partner may be held by the creditors, but if he is compelled to pay he would have the same rights against his former partners that a surety who had paid a debt would have against his principal.

§ 225. Limited partnership.—We have been speaking of general partnerships, in which each and all of the partners are individually liable for all the debts of the firm. Limited partnerships are creatures of statutory law. They are partnerships in which the pecuniary responsibility of some of the partners is limited to a fixed sum. Persons wishing to embark their means in such ventures are required to comply strictly with the provisions of the law authorizing their formation.

§ 226. Good-will.-The good-will of the partnership goes to the surviving partners in case of dissolution by death, and where one partner disposes of his interest to his copartners, his interest in the good-will goes with it.

CHAPTER XVIII.

NEGOTIABLE INSTRUMENTS.

Contracts in the form of bills of exchange and promissory notes will now be considered.

§ 227. Definitions.-The old definition of a bill of exchange, which is approved by Kent, is as follows:

A bill of exchange is a written order or request by one person to another, for the payment of money at a specified time, absolutely and at all events.

Story defines a promissory note as:

A written engagement by one person to pay another therein named absolutely and unconditionally a certain sum of money at a time specified therein.

§ 228. Origin of law merchant.-Bills of exchange which were first used by the bankers and merchants of Florence and Venice, to facilitate the transfer of credits between distant points, came to England through France early in the fourteenth century. Negotiable notes did not come into use in England until about two hundred years ago. Embarrassments arose in the application of the common law of England to these forms of contract, and it was after a long struggle that the courts engrafted upon the common law the law merchant, by which the parties to bills and notes are put upon a footing entirely different from that of parties to other contracts.

Promissory notes are negotiable or non-negotiable, according to the laws of the various states where they are made or are to be paid.

Some statutes require that the note, to be negotiable according to the law merchant, must be payable to the order of the payee; some that it must be payable to his order and at a bank of discount and deposit. Some authorities hold that a promissory note is negotiable, without the phrases "or order" or" to the order." Notes payable to bearer are negotiable by delivery.

§ 229. Foreign and inland bills.-A foreign bill of exchange is one that is drawn in one state or country and payable in another, and the several states of the Union are foreign to one another in this respect.

An inland bill of exchange is one that is drawn. and payable in the same state or country.

§ 230. The parties to a bill of exchange may be the drawer, who is the maker; the drawee, the person who is requested to pay it; the payee, to whom by the terms of the bill it is to be paid. We give a simple form of a bill with the three parties named:

$500.00.

NEW YORK, May 1, 1895. At sight pay John Jones (payee) or order five hundred dollars, value received, and charge same to account of JOHN SMITH (drawer). TO RICHARD ROE (drawee), Philadelphia.

$231. Indorsement.-If John Jones, the payee, wishes to transfer the bill he does so by simply writing his name on the back of it and delivering it to the person to whom he transfers it, and this new party, so long as he keeps the paper, is the indorsee or holder. If he in turn wishes to transfer it, he

writes his name on the back and gives it to the person to whom he transfers it, in which case he loses his character as indorsee and holder and becomes an indorser, and the person to whom he transfers the paper becomes the indorsee and holder.

§ 232. Duty of the holder.-It is the duty of the holder of the bill, whether he be payee or indorsee, to promptly present it to the drawee for payment, if it is payable at "sight," or to present it to him for acceptance if it is a time bill, that is, payable at a future date. If the bill is accepted the drawee evidences his acceptance by writing across the face of the bill the word "accepted," and signing his name under it. If when presented to the drawee he refuses to pay or accept the bill, it becomes the duty of the holder to have it protested; that is done by a notary public who presents it for payment or acceptance at the place where it is payable in business hours, and upon acceptance or payment not being made, he protests the bill and makes a certificate, attested by his signature and notarial seal, showing the fact of presentment and non-acceptance or non-payment, as the case may be. Notice in writing of protest must be promptly given by the notary to the drawers and indorsers, if any, in order to fix their liability to the holder. If the bill is not presented in time, and if notice of non-acceptance or non-payment and protest is not promptly given, the drawer and indorsers are discharged from liability, unless by the terms of the bill presentment, demand and protest are waived.

§ 233. Special indorsements.-The form of indorsement, and the rights and liabilities of indorsers