L. C. August 1833. A solvent part ner may, after a secret act of bankruptcy committed by his co-partner, make the firm liable by accepting a bill for a previous liability. Ex parte ROBINSON.- In the matter of HOUGH- THIS was an appeal from the decision of the Court of Review in ex parte Ellis, reported Mont. & Bli., page 249, upon the following SPECIAL CASE. Previously to the issuing of the commission hereinafter mentioned, the said bankrupts carried on business in Soho Square, as drapers and copartners, under the name and firm of Houghton and Watts. On the 4th January 1832 the said James Houghton absconded and committed an act of bankruptcy. Upon the following day the said John Watts accepted, in the names of the said firm, and delivered to Evan Davies, three bills of exchange, of which the following are copies : £500. London, Dec. 31, 1831. Two months after date pay to my order five hundred pounds, value received. To Messrs. Houghton and Watts, Soho Square. EVAN DAVIES. (Indorsed) At Pay Mr. W. Robinson or order, Messis. Prescott, Grote, and Co. HOUGHTON and WATTS. EVAN DAVIES. WM. ROBINSON. £750. London, Dec. 31, 1831. Two months after date pay to my order seven hun dred and fifty pounds, value received. To Messrs. Houghton and Watts, ] Soho Square. Messrs. Prescott, Grote, and Co. HOUGHTON and WATTS. } EVAN DAVIES. (Indorsed) Pay Mr. W. Robinson or order, EVAN DAVIES. WM. ROBINSON. £300. London, January 2, 1832. Two months after date pay to my order three hun dred pounds, value received. To Messrs. Houghton and Watts, Soho Square. (Accepted) Messrs. Prescott, Grote, and Co. HOUGHTON and WATTS. } EVAN DAVIES. (Indorsed) Pay Mr. W. Robinson or order, EVAN DAVIES. 1833. Ex parte ROBINSON. In the matter of HOUGHTON and another. The said bills were not drawn on the days on which they respectively bear date, but on the 5th January aforesaid, and were accepted and delivered by the said John Watts as aforesaid, as a security for liabilities contracted by the said Evan Davies upon certain bills of exchange, before the said 4th day of January, accepted by the said Evan Davies for the accommodation of the said bankrupts, and which bills were then outstanding in the hands of third parties. When the three bills above set out were so given to the said Evan Davies, he knew that the said James Houghton had absconded, and had committed an act of bankruptcy. On the same day the bills were indorsed by the said Evan Davies, and remitted to one William Robinson, and by the said William Robinson placed to the credit of the said Evan Davies in account. At the time of such remittance the said Evan Davies was indebted to the said William Robinson in the sum of 2,000, and the said bills were bonâ fide so credited by the said William Robinson, in ignorance of the circumstances under which they had been accepted, and without notice of the act of bankruptcy having been committed by the said bankrupts, or either of them. On the 6th of January the said John Watts also committed an act of bankruptcy. On the 10th a commission of bankrupt under the Great Seal of Great Britain was issued against the said James Houghton and John Watts, under which they were declared bankrupts; and Wynn Ellis, Andrew Caldecott, and William Dean were chosen assignees. The said William Robinson tendered the said three bills of exchange for proof under the said commission, against the joint estate of the said bankrupts, and the proof thereof was admitted by the commissioners. The said Wynn Ellis, Andrew Caldecott, and William Dean, in the month of November 1832, presented their petition to the Court of Review, praying that the said proof of the said three bills of exchange, amounting to the sum of 1,5507., so made by the said William Robinson, might be expunged; and on the 14th of February 1833 the said petition came on to be heard before the said Court. The Court was of opinion, that the said William Robinson was not entitled to prove the said bills, or either of them, against the joint estate of the bankrupts; and therefore ordered the proof to be expunged accordingly, and that the costs of the petitioners and respondents should be paid out of the estate of the bankrupts. The question is, Whether, under the circumstances aforesaid, the said William Robinson was entitled to prove such bills against the joint estate of the bankrupts ? I think this a proper case to be presented upon appeal to the Lord Chancellor. 14th March 1833. GRIFFITH RICHARDS. Approved of and certified by me, 14th March 1833. T. ERSKINE, C. J. Sir E. Sugden and Mr. Richards for the appellants :The question is, Whether, after an act of bankruptcy by one of two partners, the solvent partner can bind the firm by accepting a bill in the name of the firm for a partnership liability; and whether a bill so accepted is or is not, on the bankruptcy of both partners, proveable, in the hands of a bona fide holder, against the joint estate? In considering this, two questions arise, First, Whether, in the ordinary case of a secret dissolution of a partnership, the power of one partner exists so as to enable him to make his co-partner liable? Secondly, assuming that he may, Whether there is any difference when the dissolution is caused by the bankruptcy of one partner? First, upon the question, in ordinary cases, Whether a partner can, after a secret dissolution, bind the firm? there cannot exist any doubt. One partner may bind the firm previous to notice of the dissolution. Osborne v. Harper, 5 East, 225; Goode v. Harrison, 5 B. & A. 157; Williams v. Keates, 2 Stark. 290, and various other cases. In Goode v. Harrison, 5 B. & A. 157, an infant had been in partnership, but upon his attaining twenty-one he did not manifest his disaffirmance of the partnership: and Abbot, C. J., says, "No doubt Bennison, whilst under twenty-one, had been a partner, and had held himself out as such to many persons, and amongst others to the plaintiff. Upon his coming of age he does nothing. He indeed ceases to act as a partner, or to purchase goods, but he gives no notice to any body that he has so ceased. Then it is insisted on his behalf, that as all he did in the character of a partner was done in his infancy, this was not necessary; and that he is not liable, unless it be affirmatively shewn that he was a 1833. Ex parte ROBINSON. In the matter of HOUGHTON and another. 1833. Ex parte ROBINSON. of HOUGHTON and another. partner with Goode when he came of age. If once a person holds himself out as being a partner, till he gives notice he has ceased to be so, those who deal with the In the matter firm upon the faith of the supposed partnership may consider him as such, and he is bound by that representation. It is not necessary, in fact or in law, that to create a legal obligation a partnership should be still continuing. The legal obligation may arise from the acts of the party. Here, during infancy, the defendant acts as partner, and when he comes of age he forbears to inform the world that he was not so." A dissolution, therefore, does not terminate the liability of a partner for the acts of his co-partners, unless notoriety of the dissolution is duly given. Secondly, with respect to the question, when the dissolution is by bankruptcy, there is not any difference either upon principle or upon decision, although there may be some apparently conflicting dicta upon the subject. Upon principle it is clear; for if the law were as is contended by the respondents, the consequence would be, as was said by Lord Ellenborough, C. J., Bayley, J., and Abbot, J., in Harvey v. Crickett, 5 M. & S. 343, "That, upon an act of bankruptcy being committed by one partner, the partnership must stop, and the solvent partner be ruined in the midst of plenty." Upon decision a solvent partner has, after the bankruptcy of his co-partner, dominion over the partnership property. Fox v. Hanbury, Cowp. 445; Smith y. Oriel, 1 East, 368; Harvey v. Crickett, 5 Maule & S. 342; Coldwell v. Gregory, 1 Price 129, from which cases it will appear that a payment made by a solvent partner after an act of bankruptcy by his co-partner is valid. |