and a retiring partner will be liable for debts contracted subsequently to his retirement, unless at the time of leaving he made known his withdrawal from the firm by a notice in the official Gazette published at London, or Edinburgh or Dublin, according to the requirements of the case, or in some local newspaper, or unless he has been discharged from such liability by an agreement between himself, the new firm, and the creditors.1 The relations of the partners to each other are governed by the partnership agreement.2 Subject thereto, each partner is ex lege entitled to take an active part in the business, to have access at any time to the partnership books, and to have the aid of his co-partners, who must act in the utmost good faith3 towards him, as by accounting for all gains made by them from partnership transactions. He must be indemnified in respect of payments made and personal liabilities incurred in the due course of business. No fresh partner may be introduced without the consent of each existing partner. The chief grounds of dissolution of a partnership, other than efflux of the time for which it was created, are (a) by act of law, as by death or bankruptcy of a partner, (B) by act of party, as by transfer of a share, (7) insanity, or (8) misconduct, as fraud, of any partner.5 On application by any partner, the Court may decree a dissolution of the partnership in certain cases specified in the Act, and "whenever in any case circumstances have arisen which, in the opinion of the Court, render it just and equitable that the partnership be dissolved.” 6 In the administration of the estate the partnership debts are paid out of the partnership property, and the individual debts. of each partner out of his separate estate. 1 Sects. 17-36. The last-named section also absolves the estate of a deceased or bankrupt partner, or a partner not having been known as such, from liability for debts contracted after the death, bankruptcy, or retirement respectively. 3 Uberrima fides. 6 Sect. 35. 2 Generally described as the 'articles.' § 34. A Corporation1 is an artificial person, represented by an individual or by a plurality of members, upon which special powers are conferred. It can be created by the Crown only. There is no individual liability of the members for its debts. $35. Companies 2 are formed with the purpose, as a rule, of carrying on more extensive business than can be attempted by ordinary partnerships. The following varieties must be distinguished. (a) Joint Stock Companies at Common Law, in which every shareholder is liable to an unlimited extent.3 (B) Registered Joint Stock Companies, the liability of some of which is unlimited, whilst others are Limited Companies,' 4 from the liability of each shareholder being confined to the amount of his own shares, or to the amount guaranteed in the Memorandum of Association.5 These derive their position from statutes of the present reign, which prescribe what is essential to their formation, to the conduct of their business, and their dissolution. The capital is divisible into 'nominal,' being the whole amount authorised by the Memorandum of Association; subscribed,' which has been applied for and allotted; and 'paid up.' (7) Regulated Companies, in which each member is admitted on payment of a fixed sum, and trades with his own capital, at his own risk. Such are the 1 Korporation; corporation. 6 2 Handelskompagnieen; compagnies. The abbreviation in French and German answering to our ' Co.' or 'Coy.' is' Cie.' 3 Actiengesellschaften; sociétés en nom collectif. French joint stock banks are usually designated banques par action. ✦ A Company that has been first registered with unlimited liability may be registered afresh as limited, and vice versa (Companies' Act of 1879, § 3). 5 Gesellschaften mit begrenzter Haftpflicht; sociétés anonymes.-As to the different kinds of companies recognised by French Law, see Code de Commerce, art. 19; for like German companies, cf. ROTHSCHILD, pp. 201-2. 6 Commencing with one of the year 1855, but the principal Act is that of 1862 (25 and 26 Vict. c. 89). 7 See further § 271 below. 8 Gelegenheitsgesellschaften; sociétés en participation. Stock Exchanges, the business of which we shall describe in the Second Part of these Lessons. The original East India Company was of the same character. (8) Chartered (incorporated) Companies, which are quasi-corporations, from time to time formed for commercial enterprises, founded upon special privileges. Such is the Bank of England. The 'Honourable East India Company,' as finally constituted, was of this nature; and similar companies exist at the present time, engaged in the exploration of foreign territories, under the auspices of the home government, which is represented by them in those regions. When the operations of a company are authorised by the sovereign power of the foreign country, and special powers are conferred by it, these are said to be granted by a 'concession.' (e) Companies incorporated by Letters Patent under 7 William IV. and 1 Vict. not corporations, but partnerships.1 These are $ 36. On the establishment of a firm, its dissolution or transfer upon the retirement or death of a partner, or admission of a new partner, a circular,2 or identical and simultaneous communication, is usually employed, which is sent to other firms with whom a connection is contemplated, or who are already correspondents of that issuing the circular. It may be printed, lithographed, or type-written, at the option of the sender. The method of advertisements is used chiefly by Mining, Railway, Shipping, and Insurance Companies, by Publishers, and by Retail Dealers. Advertisements vary much in style, according to the caprice of the parties interested in their success.4 1 As to Syndicates and Trusts, see § 197 below. 2 Rundschreiben; circulaire. spondence, ch. iii, 3 Annonce in F. and G. • Précis Writing, &c., U.S. See Précis Writing and Office Corre LESSON VII. PRINCIPAL AND AGENT; EMPLOYERS AND EMPLOYED. Law of Agency - Clerks and Assistants-Travellers — Apprentices · Employers' liability. $ 37. IN the last Lesson the position was discussed of principals in business. We have now to look at that of persons in a subordinate capacity. And first of Agents. Agency1 is a contract the legal incidents of which specially concern men of business, as "by far the most important and numerous of daily transactions are carried on by means of agents.” 2 By this contract a person agrees to act for or on behalf and in the name of another. A maxim of the law is qui facit per alium facit per se. So that a person unable to act for himself, as a lunatic,3 may act through another. In some cases the law presumes an agency, in the absence of an express contract to that effect. Thus a partner, as we have seen, is regarded as agent for his co-partners. For certain purposes even a child living under his father's roof is treated as his father's agent. Hence a person precluded from binding himself may yet bind another. 4 The appointment of an agent is generally made by word of mouth, and so even in a del credere contract, by which goods are entrusted to an agent for sale by a foreign principal, the agent undertaking, in consideration of a higher commission, to be personally liable in case the purchaser makes default in payment.1 'Procuration,' if it extend no further than the signing of letters, drafts, &c., may be conferred by writing unsealed; otherwise it must be by deed.2 The following are points of importance as regards the duty of an agent to his principal. (a) If the agent act in any matter at all, he must carry it through, being liable for the whole. (B) If his services are remunerated, he must exercise the care of an ordinary man of business; otherwise he is liable only for gross negligence. (7) He cannot transfer his agency to another, except under necessity, or by leave of his principal, or by the usage of trade. The principal is personally liable for all contracts made by his agent, which the latter was authorised to make, and even though the agent go beyond his authority, if the principal afterwards ratify the engagement. For any act of a general agent, however, the principal is liable, although it was not within the scope of his authority. For example, a man has been in the habit of allowing his servant to buy on credit, but forbids him to do so any longer. If the servant buy on credit again, even after he has been dismissed, the master is liable, unless the seller is aware of the master's prohibition. A general agent is one engaged in a particular employment, such as a clerk or domestic servant, as distinct from a particular agent appointed to do one or more specific acts only. Two tests can be applied in ascertaining to which category an agent belongs: (a) the extent of authority generally enjoyed by persons in that way; (B) the extent of authority the particular agent has been wont to enjoy. A universal agent is one employed to act in various employments, or in all matters on behalf of the principal. 1 That this need not be in writing is an anomaly, for it is clearly a case of suretyship. See § 18 above. 2 lower of Attorney. |