1833. Ex parte In the matter of NOTLEY. [Sir George Rose:-This appears to be a distinct debt, for which an action might have been brought notwithstanding any partnership. If upon the formation of a partnership one partner advance money to another partner to enable him to embark in trade, it is as distinct as if they were not partners. Here the money was advanced upon security of a bond in the common form, reserving five per cent. interest, and of a warrant of attorney upon which judgment has been entered up.]. It is true that in the bond there is nothing respecting partnership, but dehors the bond this agreement for a participation in the profits was made. If, therefore, the money was not advanced as capital, it is clear that the object of the lender was to obtain more than five per cent. interest. The agreement, therefore, either created a partnership or was a usurious contract. [Sir John Cross:-The agreement for participation in the profits may create a joint liability as to third parties, but there is no evidence of a partnership as between themselves. A creditor may insist on the joint liability, but can a debtor turn round and say to his creditor, although contrary to our contract, yet, as the law makes us partners, you shall not recover your debt." 66 Sir George Rose:- Assuming the fact of partnership to be established, it would only exist as in favour of third parties, whether the advance were as capital or not. But the petition does not allege that it was advanced as capital, being confined to a statement of this being a partnership created by a participation of profits. There are many cases proving that, even as between partners, one may lend a sum to another by which a legal obli ner paid all debts, I should think There being some dispute as to the fact, it was referred to the Master. Windham v. Paterson, 1 Starkie, 144; Matson v. Barber, 1 Gow. 17. 1833. Ex parte NOTLEY. of NOTLEY. gation would be created. In this case there is not only a bond, but a judgment, and although it was not to be acted on until 1837, yet by the bankruptcy that time has, by anticipation, arrived, and the commission In the matter is only in the nature of a statutable execution. Then as to usury, how can the party come here to avail himself of such an objection, except upon the equitable terms of paying principal, interest, and costs? Besides, usury is not alleged in the petition.] The only method which one partner has of enforcing rights against another is by filing a bill. If a sum of money is advanced by one person to another, for the purpose of forming a business in which they are to be jointly interested in the profits, it is clearly a debt arising out of the partnership, the very essence of the contract being the formation of a partnership; and such a debt will not support a commission. Windham v. Patterson, 1 Stark. 144. [Sir G. Rose: There is no express contract for a partnership in this case. If it exist, it is merely by operation of law.] Mr. Swanston, for the petitioning creditor, was not called on. The CHIEF JUDGE: Some disputed facts as to the original agreement are not clearly before the Court; but it is unnecessary to direct any further inquiry as to those facts, if they would not vary the material parts of the case. The undisputed facts are shortly as follow: Briggs advanced the money on a bond and warrant of attorney for securing repayment, with interest at five per cent., in 1837; which money was to be employed by Notley in his trade. It is said, that this is not a good VOL. I. E 1833. Ex parte In the matter of NOTLEY. petitioning creditor's debt, as there was, dehors these written documents, an agreement to share the profits of the trade, and therefore this debt must be considered as arising out of the partnership. But that is not so; it is only when it is necessary to take the partnership accounts to ascertain the amount of the debt that it can be said to arise out of the partnership, so as to deprive the creditor of his legal right. It has been determined that, in the case of a partnership, if there has been an account rendered and a balance struck, the same might be proved under a commission. So it may support a commission. The cases in which the objection of the existence of a partnership has been taken are those in which money is actually brought into the partnership accounts as between the partners, and where it would depend upon taking the accounts whether the sum were due or not. But here the money is to be repaid at all events. It was merely a loan from one individual to another, and therefore it is a sufficient debt to support the fiat. Sir John Cross: There is no evidence of a contract or agreement for partnership as between the parties themselves. If A. undertake to give B. a share of profits, as to creditors, both may be liable as partners; but a party cannot say, "by operation of law you are my partner;" there is no ground at law or in equity to entitle this bankrupt so to turn round upon his creditor. But even if there were a partnership, I think this was not a debt arising out of partnership. Petition dismissed. Nov. 13, 1833. The costs of a petition to prove must be paid by the creditor if Ex parte PRICE. In the matter of PRICE. THIS was a petition for leave to prove, which stated, that when the petitioner attended before the commissioners they rejected his proof, all but 201., on the ground, as petitioner understood, that the entries in his evidence. If he accounts were made recently, and for the purpose of succeed on evimaking himself appear a creditor. The petition prayed was tendered the costs of this application. Affidavits were filed in verification of the account, which established the case of the petitioner; and the question which then arose was, whether the commissioners had altogether rejected the proof, or had ordered it to stand over till further evidence was produced. Mr. Swanston and Mr. O. Anderdon for the petitioner having opened the case, the Court interposed. Per Curiam:-It appears that the commissioners stated they were not satisfied with the proof adduced, and required further evidence. On the part of the petitioners it is insisted that such further evidence was tendered, but refused. The respondents deny this; and, on examining the proceedings, no memorandum appears of any further evidence having been tendered. Under these circumstances, the proper course would appear to be to refer it back to the commissioners, in order to give the petitioner an opportunity of producing his further evidence. As to the costs of this petition, they would depend upon the fact whether the evidence was or was not tendered; and the affidavits being contradictory on that point, the commissioners should certify to this Court what actually passed on the former occasion. These are only observations thrown out for the consideration of counsel. he adduces new dence which before the commissioner and rejected, it seems he might be entitled to costs. A certificate from the commissioners is wholly unnecessary, it being distinctly sworn by four persons that further evidence was tendered and rejected; and the denial of this is merely by the affidavit of the solicitor of the assignees, which in effect amounts to no more than that he has no recollection that other witnesses were produced. As to costs, they ought to be allowed, because this proof was rejected so improperly as to form one of the exceptions to the general rule, that costs are not given against a decision of the commissioners. (a) Mr. Griffith Richards and Mr. Bacon for the respondents: When the petitioner tendered his proof before the commissioners they required evidence in its support; he thereupon produced his books, when all the entries constituting the items of his claim were discovered to be entered together in one place, which the commissioners thought so suspicious that they required further evidence; and there the matter rested, for none was produced. The CHIEF JUDGE:- It appears to me that the petitioner has established his right to prove, by the affidavits in support of his petition. The question therefore resolves itself into this, who is to pay the costs? No rules are clearer or better established than those which lay down that, when, in cases like the present, the assignees support the decision of the Court below, they take their costs out of the estate, unless a case of suppression of evidence is made out; and that a party who succeeds in this Court against a decision of the commis (a) Ex parte Fiske, 1 Mont. & Mac. 93. |