was

firm of Gilbert & Mitchell." It is in evidence, as alleged, that, on the 20th December, 1871, a sale was made to plaintiff, by Dawes, a broker, of 125 tons of pig iron, at $24 per ton, payable in cash, less six per cent, as per broker's note delivered to plaintiff. That sale is alleged to have been made by defendants, but it is, in fact, Mitchell who caused it to be made, without the participation of Gilbert. The plaintiffs, not having had delivery of the iron, have brought the present action. They claim $680 damage. They, previous to the institution of the action, offered to defendants $2820, à bourse déliée, being the price of said sale. The defendant Mitchell is proceeded against by default. Gilbert, the other defendant, pleads that he had been in co-partnership with Mitchell, the other defendant, since the 11th April, 1871, but the partnership ceased before the institution of this action, and that, as to the sale in question, Gilbert wholly ignorant thereof, nor had Mitcheli any authority or power whatever to enter into such sale, which was beyond the scope of the co-partnership. To simplify this case, it is sufficient to inquire as to what the nature of the above copartnership was. The answer is at hand. Defendants were iron and brass founders, doing business, as such, together;" they were that, and nothing else; they were not traders, by any means, in iron; consequently, it was their business, as well as their duty, to confine themselves to what the article of co-partnership had laid down for their guidance. Such sale as the one now in question is beyond the scope of the co-partnership. It is important not to lose sight of this, in the solution of the question, because, if Mitchell did what he was not authorized to do, Gilbert is not bound, and, if he is not bound, the action cannot stand against him. Now, whatever obligation there was in plaintiffs, before entering into such a transaction as this sale is pretended to be, to inquire or not as to what were the limits of the co-partnership, one thing is, I think, so certain that it can't be gainsaid, every one, and, especially plaintiffs, were bound to know and remember, and they well knew, what kind of business defendants carried on; they, as well as the public, knew it, and could not ignore it. That point once made out, it, of course, follows, that they bought, at their own risk, and it must be to their own loss, the 125 tons of iron, for the sale of which Gilbert is not to be held responsible. The plaintiffs are not to be presumed in bad faith, quite the contrary; but they, no more than any other party, have a right to claim the enforcement of a sale which one of the defendants had no right to make, and which the other defendant repudiated, as soon as he knew of it, and as a necessary sequence, plain

tiffs have no right to claim damages for the non-execution of the sale, as far as Gilbert is concerned. No confusion in commercial matters and business need be feared from a decision, in view of the above. One only requires to consider whom one deals with, and abstain from purchasing from a party who has no right to sell. This applies to all transactions, whatever they are or may be. In other words, if there is a deed of co-partnership, and, if it be, as it ought to be, duly registered, it should be examined, before any transaction is entered into with the firm. If there be no articles of partnership, or, if such deed or articles be not registered, then parties and the public are supposed to know what kind of business is carried on, it being a business openly carried on, au su et vu de tout le monde. Therefore, if any of the partners do anything which is within the scope of the copartnership and its nature, all parties thereto become bound, whether they authorized the transaction or not. But, if any partner transcend the limit of the co-partnership, whether stipulated in writing, or of its nature or character, ostensible and known to the public, no obligation is thereby fastened on the other partners. That is law I believe, and, if so, it must be, and it is right and just therefore. The above enunciated principles must, in my opinion, govern this case. The conclusion which their application justifies is, that Gilbert is not bound by the sale effected by Mitchell, in the name of the firm, the action cannot stand against him but should be dismissed. The judgment rendered against Mitchell could not be reversed, because he does not complain of it. Either way, the judgment now appealed from must be reversed, quant à Gilbert, with costs.

TORRANCE, J., giving the judgment of the Court: the plaintiffs, in their declaration, set out a sale by defendants to them, through Robert Dawes, a broker, on the 20th December, 1871, of about 125 tons of pig iron, for the price of 24 dollars per ton; that defendants never delivered, though duly put en demeure to do so, to the damage of plaintiffs of $680. Only one of the defendants, Frank Gilbert, contests the demand, and pleads that he was ignorant of such sale, and that his co-partner, Alexander Mitchell, had no authority to make said sale, and was debarred therefrom by their articles of partnership; that it was not in the scope of their business to sell pig iron, in the quantities mentioned in the declaration, or to sell pig iron at all; that Mitchell had no power to bind him by such sale, and, if plaintiffs contracted for the purchase of said iron, they did so without inquiry, and without due care, and must have known the course of trade of said firm; and Gilbert notified plaintiffs, so soon as

aware of the sale that he would not carry it out. Judgment went against the co-partnership, for $206.25, and is appealed from by Gilbert.

Here follow the remarks made by Judge MACKAY in rendering the judgment of the Superior Court: "The articles of partnership are filed, and it is clear that Mitchell exceeded his authority, as he was to attend to the inside work of the foundry, and Gilbert to the outside, the buying and selling, etc. The sale was made below the market value, but, under art. 1012 of the code, sale cannot be set aside for this. The sale must be maintained if there is no fraud on the part of plaintiffs, and there is none. The sale of 125 tons of pig iron does not seem to be too much for one partner to do, and in many cases it might be necessary to save the credit of a firm in meeting a note, etc. Judgment for $206.25."

66

TORRANCE, J.: The evidence shows that defendants, Gilbert and Mitchell, by an agreement made before a notary, on the 11th April, 1871, entered into a partnership, as founders. This agreement provided that Gilbert should attend to the general management, to the keeping and collecting of the accounts, and to the looking up of business; it being understood that he was not bound to give the whole of his time, or attention, to the business. Mitchell, on the other hand, was to attend to the carrying on the business in the shop, the personal superintendence of the men, and the practical and mechanical working of the business, and was to give the whole of his time to it. All signatures of the firm were to be affixed by Gilbert alone. "No contracts or agreements, "either for the sale or purchase, or for material or goods exceeding the value of $100, shall be made by either party, without the consent of the other, such consent being con"sidered as given if no objections in writing are given to the other party within 24 hours of his being personally notified "of such sale or purchase having been made." On the 4th of January, 1872, 65 days after the sale to plaintiffs, defendants dissolved their partnership, and, by the dissolution, the assets were transferred to Gilbert, who paid to Mitchell a considerable sum of money for his interest, and undertook to pay the debts of the firm. What is the authority of copartners to bind their firm? Lindley, Partnership, pp. [192,3] each partner is prepositus negociis societatis, and each partner virtute officii, possesses an equal and general power and authority, in behalf of the firm, to transfer, pledge, exchange, or apply, or otherwise dispose of the partnership property and effects, for any and all purposes within the scope and objects of the partnership, and in the course of its trade and business. Any restriction, which, by agreement

66

6

among the partners, is attempted to be imposed upon the authority which one possesses, as a general agent for the other, is operative only between the partners themselves, and does not limit the authority as to third persons, who acquire rights by its exercise, unless they know that such restrictions have been made." Story, Partnership, § 101: "The principle extends so as to bind the firm for the frauds committed by one parner without the knowledge of the others, &c." § 108. The French law has adopted a rule essentially the same, § 109. § 111: "The authority must be exercised in cases within the scope of the ordinary business. It would not bind if not the ordinary course of business." § 112: "If one partner should in the name of the firm make purchases of goods, not connected with the known business of the firm, such purchase would not bind the partnership." But, if the articles were such as might be applied or called for in the ordinary course of their business, the purchase of such articles would bind the firm, even though they were unnecessary at the time, or were bought contrary to the private stipulations between the partners, or were not designed to be used in the partnership at all, if the vendor were not acquainted with the facts. Collyer, Partnership, says, § 384: "It may be laid down as a general rule that partners are bound universally by what is done by each other in the course of the partnership business." 1 Parsons, Contracts, p. 155: "Among the questions which have arisen as to the limitations to the general power of a partner over the partnership property, one, not yet perhaps perfectly settled, is as to the power of one partner to make an assignment of the whole property to pay the partnership debts. We think the weight of authority and of reason is in favour of this power, and that such assignment, being entirely in good faith, would be held valid. He may sell the whole stock in trade by a single contract, p. 160: "The act of each partner is considered as the act of the whole partnership, or of all the partners, only so far as that act was within the scope of the business of the firm; but one co-parner may bind the firm in matters out of their usual course of business, if they arose out of and were connected with their usual business." See Sandiland vs Marsh, 2 B. & Ald., 673. Applying these rules here, it is impossible to say that the purchase of pig iron is not connected with the business of founders which was that of the defendants, and if the purchase, why not the sale? No case of fraud is charged against the plaintiffs who were in perfect good faith, and who were in entire ignorance of the precise relations of the two partners to one another, or of their articles of partnership. And, looking at these articles, plaintiffs' counsel has well

called attention to the stipulation of the articles, that pur chases and sales for a greater amount than $100 shall not be made without the joint consent of the partners, but the consent may be considered as given, if no objections in writing are made within 24 hours to the other partner making the contract. As between the partners, no objection has been proved in writing within 24 hours, though at any rate, if it had been proved, it could not affect the right of third parties in good faith like the plaintiffs. Judgment confirmed, MONDELET, J., dissenting. (18 J., p. 22; 4 R. L., p. 655, et 5 R. L., p. 468)

W. H. KERR, Q. C., for plaintiffs.
W. W. ROBERTSON, for defendants.

UNPAID VENDOR.

COURT OF QUEEN'S BENCH, Montreal, 23rd June, 1873.

Coram DUVAL, J. C., DRUMMOND, J., BADGLEY, J., MONK, J., TASCHEREAU, J.

GAUTHIER, Appellant, and VALOIS, Respondent.

Held-That the unpaid vendor of an immoveable, who has instituted an action résolutoire for non payment of the price, before the décret of the property, (although the judgment be not rendered until some months after) has a right to be paid by preference even to a mortgagee, whose hypothec has been registered two years before the registration of the deed of sale by the vendor.

This was an appeal from a judgment rendered by the S. C., at Montreal, BEAUDRY, J., on the 28th of February, 1871. The facts and circumstances of the case are fully explained in the following remarks of TASCHEREAU, J., who pronounced the judgment in appeal :

TASCHEREAU, J.: Appel par Séraphin Gauthier, demandeur en Cour Inférieure, d'un jugement renvoyant sa contestation de l'opposition de l'Intimé, et maintenant la collocation du même à l'ordre de distribution, et ce sous les circonstances suivantes. L'Intimé avait vendu un huitième indivis dans une terre (saisie en cette cause) au défendeur, Pierre Charles Valois, un des défendeurs, pour 2126 livres de 20 sols, et ce par açte du 13 juin 1864-le 13 mars 1865, Dame MarieLouise Valois avait transporté à l'intimé une somme de 1667 livres de vingt sols qui lui était due par le même défendeur, sur vente d'un autre huitième de la même terre par MarieLouise Valois à Pierre Charles Valois, suivant actes notariés