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than substantial, and perhaps the courts in a proper case might invoke the doctrine of elaborate contrivances and ingenious devices.

In this connection it might be remarked that the institution of limited partnerships hereafter noticed has arisen under the statute law to legalize what seems necessary to meet the requirements of justice, namely, full responsibility to managing partners and limited liability to those who merely furnish capital.

And so in the efforts of legislative bodies to harmonize the equitable principles of the law, it is frequently provided that officers of corporations shall have imposed upon them the liabilities of members of partnerships whenever they do certain acts that create a liability unauthorized by the legal or financial situation of the corporation. For illustration see statute law of Illinois in regard to corporations.

In the following case the suit was for work and labor performed and materials furnished in and about the repairs of a lighter. There was no question as to the plaintiff's right of recovery against some one. It was a question whether Boswell or Russell individually or Boswell and Russell jointly as partners were liable.

First the evidence showed that the lighter was the property of Russell and that Boswell worked her and divided the profits with Russell. But then the question was whether Russell paid half the profits to Boswell for his services, or Boswell paid half the profits to Russell for rent, or whether Russell and Boswell divided the profits under an agreement that Boswell should put his work against Russell's capital and they should conduct the business with equal rights as to direction and control of the business.

Only in the latter case could they be sued jointly unless they had held themselves out as partners.

Either one who ordered the repairs might be held responsible if he did not disclose his principal. That is Boswell might be held liable in any case if he ordered the repairs and did not disclose that he was servant or partner of Russell. In such case if he was actually a partner the plaintiff on discovering this later would have his option of suing Boswell, or Boswell and Russell; and so if Boswell was the servant of Russell the plaintiff on discovering this would have his option of suing either Boswell or Russell, but in the latter case he could not sue them both. If the plaintiff had notice of a partnership at the time the repairs were ordered he must sue both.

The evidence finally showed that Boswell was servant and that he ordered the repairs without disclosing his principal and as he was the party sued he was held liable. This case is a good illustration of the doctrine that the law of partnership is a branch of the general law of agency.10

SECTION 7. CLUBS AND ASSOCIATIONS.

Unincorporated clubs and associations formed for political, social, religious, educational or charitable purposes and not for financial gain, are not partnerships. The members are not mutual agents; the officers are not general agents unless expressly so made. And when any officer or committee of the club or association performs any act whereby it is sought to hold a member financially responsible, it must be shown that the member authorized the doing of the act in his behalf or that he obligated himself 10 Dry vs. Bowsell, 1 Campbell, 329, Ames'

Čases on Partnership, page 18.

to give it a certain financial support. The officer, or committee, and those members authorizing the act by vote or contract are liable. One cannot look at the object of the association, consider its scope, and then seek to bind the association as a body for an act done by an officer in furtherance of that object and within the natural scope of the association activities. Their activities are gratuitous and the range is determined from day to day by personal volition.

Much of the litigation under the law of partnership arises from the question of the extent of the right, with notice of the partnership and without notice of the limitations of authority, to assume that certain powers of agency exist. The general rule is that a third party must consider the nature of the partnership business, the ordinary, customary rules regulating the conduct of such business and within such scope he may safely assume, without notice to the contrary, that each partner of the firm has authority to buy, sell, and contract. But he deals with a club or association, formed for non-pecuniary purposes, with notice that it is not a partnership, and so it is incumbent on him to ascertain who will be bound.

In Burt vs. Lathrop," a large number of dentists were using a hard-rubber material, which use, it was claimed, was an infringement on certain patent rights. The dentists formed an association, with a membership fee of five dollars, and elected officers. These officers employed an attorney and for his services he brought a suit joining all the members of the association on the theory that they constituted a partnership. In the decision of this case the court said: "We can find in this arrangement nothing " 52 Mich., 106; 17 N. W. Rep., 16, Mechem's Cases on Partnership, p. 4.

analogous to a partnership. There was no common business, and nothing involving profit and loss in a business sense. No one was empowered to make contracts binding on the subscribers personally, and no one was to be liable except for assessments, nor even for those except as he saw fit to pay them to keep his membership."

SECTION 8. DEFECTIVE ORGANIZATION OF

FORATION.

A COR

An association of individuals may be conducting a business under a claim of corporate powers and privileges when there is no legal corporate existence. In such a case the organization is neither a corporation de jure nor a corporation de facto; but is a pseudocorporation. The members of a pseudo-corporation are liable to its creditors as partners. A person who contracts with a de facto corporation cannot question its existence de jure in a suit on the contract. He is liable; it is liable. The de jure existence is a question for the state under a writ of quo warranto. A de facto corporation is a legal corporate body till the state acts, with full power to contract, to sue and be sued. In order to constitute an organization a corporation de facto there must be

1st. Some valid constitutional law under which the corporation might have been organized.

2nd. A fulfillment of conditions precedent in the law, especially those pertaining to publicity.

3rd. An apparently honest attempt to meet all the requirements of the law and a user under the law. A creditor of a corporation may bring suit against the members thereof jointly as partners if he can show a substantial failure in any one of these three particulars.

In Mokelumne Hill Mining Co. vs. Woodbury," the court said: "There is a broad and obvious distinction between such acts as are declared to be necessary steps in the process of incorporation, and such as required of the individuals seeking to become incorporated, but which are not made prerequisites to the assumption of corporate powers. In respect to the former, any material omission will be fatal to the existence of the corporation, and may be taken advantage of collaterally in any form in which the fact of incorporation can properly be called in question."

In Bigelow vs. Gregory, et al.,13 the court said: "There is a manifest difference where a corporation is created by a special charter, and there have been acts of user, and where individuals seek to form themselves into a corporation under a general law. In the latter case it is only in pursuance of the provisions of the statute for such purpose that corporate existence can be acquired. And there would seem to be a distinction between a case where, in a suit between a corporation and a stockholder or other individual, the plea of nul tiel corporation is set up to defeat a liability which the one have contracted with the other, and the case of a suit against individuals who claim exemption from individual liability, on the ground of their having become a corporation formed under the provisions of a general statute. In the latter case, a stricter measure of compliance with statutory requirements will be required, than in the former.

The failure to file articles of incorporation for

" 14 Cal., 424; 73 Am. Dec., 688.

13 73 Ill.,

179.

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