insolvency of the partnership, although the partnership creditors have not brought any actions for their debts.

Hence, if a creditor of A attaches his interest in the property of A, B, & Co., and a creditor of A, B, & Co. attaches the same property, the first attachment is postponed to the second; that is, it has no effect until the debt of the second creditor is fully satisfied, and then it is good for the surplus of property. If, however, one partner is dormant and unknown, the creditor of the other attaching the stock is not postponed to the creditor who discovers the dormant partner and sues him with the other, unless the first attaching creditor's claim has no reference to the partnership business, and that of the second attaching creditor has such reference.

The partnership creditors are restrained from appropriating the private property of the copartners until the claims of their private creditors are satisfied in courts of equity. And some rccent adjudications indicate that the rule will become established at law.

I think the law ought to be, and that it is now tending to become, this. A partnership is a kind of body by itself, somewhat like a corporation. It has its own funds and its own debts. The individual members may also have each his own funds and his own debts. The funds of the partnership should first be applied to the debts of the partnership; and, if there be any surplus, the members have it, and their creditors get it. So the private funds of each member should first be applied exclusively to the payment of that person's private debts; and when they are wholly paid, the surplus should go to the partnership creditors, because each partner is responsible for the partnership debts. This rule prevails on the continent of Europe very generally.

It is now quite certain that the levy of a private creditor of one copartner upon partnership property can give him only what that copartner has; that is, not a separate personal possession of any part or share of the stock or property, but an undivided right or interest in the whole, subject to the payment of debts and the settlement of accounts, including also the right to demand an

account.

As to how such levy and sale of the interest of one copartner shall be made by the sheriff, there is much diversity both of practice and of authority. Upon principle, we think the sheriff can neither seize nor transfer by sale either the whole stock or any specific portion of it. He should, we think, without any actual seizure, sell all the interest of the defendant partner in the stock and property of the partnership; much in the same way in which he would sell

his right to redeem a mortgage, or any other incorporeal right, subject to attachment. The purchaser would then have a right to demand an account and settlement, and a transfer to himself of any balance or property to which the copartner whom he sued would have been entitled.

Where the trustee process, or process of foreign attachment, is in use, the better way would be for the sheriff to return a general attachment of all the interest of the debtor in the partnership property, and summon the other partners as the trustees of the debtor.

It must be stated, however, that the rules of law in regard to the liability of partnership property for the private debts of partners, and as to how any such liability may be enforced, are, at present, somewhat obscure and uncertain.

SECTION IX.

THE EFFECTS OF DISSOLUTION.

If the dissolution is caused by the death of any partner, the whole property goes to the surviving partner or partners. They hold it, however, not as their own, but only for the purpose of settlement; and therefore they have, in relation to it, all the power which is necessary for that purpose, and no more. If they carry on the business with the partnership funds, they do so at their own risk ; and the representatives of the deceased may require their share of the capital, and choose between calling on them, in addition, for interest, or for a share of the profits which the surviving partners have made.

The survivors are not partners but tenants in common (joint owners) with the representatives of the deceased of the stock or property in possession; and have all necessary rights to settle the affairs of the concern and pay its debts. After a dissolution, however caused, one who had been a partner has no authority to make new contracts in the name of the firm, and cannot make or indorse notes or bills with the name of the firm, even if he be expressly authorized to settle the affairs of the firm. There must be a distinct authority to sign for the others who were formerly partners. A parol authority will be sufficient, even if the general terms of the partnership had been reduced to writing.

It is common where a partnership is dissolved by mutual consent, to provide that some one of the partners shall settle up the affairs of the concern, collect and pay debts, and the like. But this will not prevent any person from paying to any partner a debt due

to the firm; and, if such payment be made in good faith, the release or discharge of the partner is effectual.

If all the debts were assigned and transferred to any person, as his property, any debtor who had notice of this would be bound to make payment to this person alone; and, if he paid anybody else, he would be obliged to pay the money over again.

It is frequently provided that one partner shall take all the property and pay all the debts; but this agreement, though valid. between the partners, has no effect upon the rights of third parties against the other partners; for they have a valid claim against all the partners, of which they cannot be divested without their con

sent.

This consent of the creditor may be inferred, but not from slight evidence; thus, not from receiving the single partner's note as a collateral security, nor from receiving interest from him on the joint debt, nor from a mere change in the head of the account, charging the single partner and not the firm. Still, as the creditor certainly can assent to this arrangement, and accept the indebtedness of one partner instead of that of the firm, so it must be equally clear that such assent and intention will bind him, if distinctly proved by circumstances or by any evidence.

SECTION X.

LIMITED PARTNERSHIP.

These have been introduced into some of our States, by statutes, which differ somewhat in their provisions. Generally, they require, first, one or more general partners, whose names shall be known; secondly, special partners, who do not appear as members, nor possess the powers or discharge the duties of actual partners; thirdly, the sum to be contributed by the special partners shall be actually paid in; lastly, all these arrangements, with such other information as may be needed for the security of the public, must be verified under oath, signatures of all the parties, and acknowledgment before a magistrate, and correctly published. When these requisites are complied with, the special partners may lose all they have put in, but cannot be held to any further responsibility. But any neglect of them, or any material mistake in regard to them, even on the part of the printer of the advertisement, wholly destroys their effect; and then the special partner is liable for the whole debt, precisely like a general partner.

In a New York case, the amount contributed by the special partner was, by mistake of the printer, stated at $5,000, instead of

$2,000, and it was held that the associates were liable as general partners, although the plaintiff did not show that he was actually misled by the error. In another New York case, it was held that an assignment of the partnership property, providing for the payment of a debt due to the special partner, ratably with the other creditors of the firm, or before all the other creditors are satisfied in full for their debts, is void as against the creditors; but it would be valid as against the assignor and those creditors who think proper to affirm it.

this

FORMS ANNEXED TO THIS CHAPTER.

(171.) Articles of copartnership between two tradesmen.

(172.) Shorter form of articles of copartnership.

(173.) Certificate of a limited partnership, with acknowledgment and

oath.

(171.)

ARTICLES OF COPARTNERSHIP BETWEEN TWO TRADESMEN.

ARTICLES OF AGREEMENT, Had, made, concluded, and agreed upon,

day of

trader, and

First of all, the said

these presents do agree, to become copartners together in the art or trade of and all things thereto belonging, and also in buying, selling, vending, and retailing all sorts of wares, goods, and commodities belonging to the said trade of which said copartnership, it is agreed, shall continue from for and during and unto the full end and term of years, from thence next ensuing, and fully to be complete and ended. And to that end and purpose he the said hath the day of date of these presents, delivered in, as stock, and he the said the sum of

the sum of to be used, laid out, and employed in common trade between them, for the management of the said trade of to their utmost benefit

and advantage. And it is hereby agreed between the said parties, and the said copartners, each for himself respectively, and for his own particular part, and for his executors and administrators, that each doth covenant, promise, and agree, to and with the other of them, his executors and administrators, by these presents, in manner and form following (that is to say), that they the said copartners shall not nor will, at any time hereafter, use, exercise, or follow the trade of aforesaid, or any other trade whatsoever, during the said term, to their private benefit and advantage; but shall and will, from time to time, and at all times, during the said term (if they shall so long live), do their and each of their best and utmost endeavors, in and by all means possible, to the utmost of their skill and power, for their joint interest, profit, benefit, and advantage, and truly employ, buy, sell, and merchandise, with the stock aforesaid, and

the increase thereof in the trade of aforesaid, without any sinister intentions or fraudulent endeavors whatsoever. And also that they the said copartners shall and will, from time to time, and at all times hereafter, during the said term, pay, bear, and discharge, equally between them, the rent of the shop, which they the said copartners shall rent or hire, for the joint exercising or managing of the trade aforesaid. And that all such gain, profit, and increase as shall come, grow, or arise for or by reason of the said trade, or joint business as aforesaid, shall be from time to time, during the said term, equally and proportionably divided between them the said copartners, share and share alike. And also that all such losses as shall happen in the said joint trade, by bad debts, ill commodities, or otherwise without fraud or covin, shall be paid and borne equally and proportionably between them. And further, it is agreed by and between the said copartners, that there shall be had and kept from time to time, and at all times, during the said term and joint business and copartnership together as aforesaid, perfect, just, and true books of accounts, wherein each of the said copartners shall duly enter and set down, as well all money by him received, paid, expended, and laid out, in and about the management of the said trade, as also all wares, goods, commodities, and merchandises, by them or either of them bought and sold by reason or means or upon account of the said copartnership, and all other matters and things whatsoever, to the said joint trade, and the management thereof, in any wise belonging or appertaining, which said books shall be used in common between the said copartners, so that either of them may have free access thereto without any interruption of the other. And also that they the said copartners, once in three months, or oftener if need shall require, upon the reasonable request of one of them, shall make, yield, and render, each to the other, or to the executors or administrators of the other, a true, just, and perfect account of all profits and increase, by them or either of them made, and of all losses by them or either of them sustained, and also of all payments, receipts, and disbursements whatsoever, by them or either of them made or received, and of all other things by them or either of them acted, done, or suffered in the said copartnership and joint business as aforesaid; and the same account being so made, shall and will clear, adjust, pay, and deliver, each unto the other, at the time of making such account, their equal shares of the profits so made as aforesaid; and at the end of the said term of or other sooner determination of these presents (be it by the death of one of the said partners or otherwise), they the said copartners, each to the other, or in case of the death of either of them, the surviving party to the executors or administrators of the party deceased, shall and will make a true, just, and final account of all things as aforesaid, and divide the profits aforesaid, and in all things well and truly adjust the same, and that also upon the making of such final account, all and every the stock and stocks, as well as the gains and increase thereof, which shall appear to be remaining, whether consisting of money, wares, debts, shall be equally

parted and divided between them the said copartners, their executors or administrators, share and share alike.

IN WITNESS WHEREOF, &c.

(Signatures.)