of the clerk of the proper county, and annual reports to the State Department were exacted.

The amendments of 1903 consisted of a revision of sections 1 and 2 of the law, and the addition of new sections 12, 13, 14, 15 and 16. The operation of these additions placed partnership associations, limited, practically upon the footing of corpora

tions.

The opinion is prevalent that these amendments emasculated the law; that its usefulness is at an end. Truly it has been overshadowed by the popularity of the consolidated corporation act. The organization of limited associations has been infrequent since 1903. Nevertheless the point is here made-and evidence in its support will be given later-that these associations, under certain circumstances, may still be organized advantageously. It may as well be pointed out now, that, with all its crudities, all its narrowness of detail, the partnership associations, limited, act is, in essentials, our broadest enabling law.

$283. Status of Partnership Associations, Limited.

Though the terms are often used interchangeably in the decisions of other jurisdictions, there is, under the statutes and precedents of Michigan, a wide distinction between Limited Partnerships and Partnership Associations, Limited. The former are but modified partnerships, having special partners whose liability is limited by statute, and having general partners whose liability remains unlimited, as at common law14. No one would mistake such an organization for a corporation. However, partnership associations, limited, havebeen pronounced corporations15,

14. C. L. 1897, Chap. 159, Sec. 6056.

15. Liverpool & London Life & Fire Insurance Co. v. Oliver, 77 U. S. 566, 19 L. ed. 1029. In this case it appeared that the Liverpool, etc., Insurance Co. had been organized under a deed of settlement, enlarged and legalized by acts of Parliament, which declared, among other things, that the association should not be a corporation. It possessed many of the characteristics of a partnership association, limited. Speaking for the court, Justice Miller said: "Whatever may be the effect of such a declaration, it cannot alter the es

sential nature of a corporation, or prevent the courts of another jurisdiction from inquiring into its true character whenever that may come in issue......... We have no hesitancy in holding that, as the law of corporations is understood in this country, the association is a corporation." Tide Water Pipe Co. v. State Board (N. J.), 27 L. R. A. 684. In this case the Supreme Court of New Jersey held the Tide Water Pipe Co. to be a corporation, although the Supreme Court of Pennsylvania (the state where the company had been organized) had previously declared the same company a limited partnership.

both by eminent courts and by able lawyers16. The array of evidence in support of this view is of great probative force. We find in the act a grant of every power and immunity essential to corporation capacity, viz. :

(a) Power of continuous succession under an adopted name (Act Sec. 1);

(b) Power to sue and to be sued (Act Sec. 10);

(c) Power to make by-laws (Act Sec. 4 and 5);

(d) Power to purchase, hold and make conveyance of, land in the company name (Act Sec. 10);

(e) Power to have a common seal (C. L. 1897, Sec. 10196); (f) Immunity of members from liability for company debts (Act Sec. 1), except labor debts, unpaid subscriptions (Act Sec. 2) and penalties for misconduct (Act Sec. 3, 13, 14).

It is earnestly argued that the sum of these attributes is a corporation. Certainly the courts of a foreign jurisdiction, where the intent of our legislature is not binding1, would find no difficulty in adducing sound reasons in support of such a conclusion. But Michigan courts are not at liberty to disregard the manifest intent of the legislative department of our state government. In fact that intent, when ascertainable, must be accorded controling influence in matters of construction18. It can hardly be argued from the phraseology of the act that, by the title "Partnership Associations," the legislature really meant "corpora

tions.'

Standing alone, the mere matter of name might not be conclusive. But when it is remembered that, during more than thirty years, our legislature has carefully refrained from treating these organizations as corporations, always mentioning them as "associations" or "partnership associations" when it has been desired to expressly embrace them in legislation applicable

16. See brief of counsel for defendants in error in Staver & Abbott Mfg. Co. v. Blake, 111 Mich. 282, 38 L. R. A. 798.

17. Liverpool & L. L. & F. Ins. Co. v. Oliver, 77 U. S. 566. 19 L. ed. 1029; Tide Water Pipe Co. v. State Board, 27 L. R. A. 684.

18. Michigan Central R. Co. v. State, 148 Mich. 151-156.

19. Attorney General V. McVichie, 138 Mich. 387-390. In this

case Justice Hooker stated that "The legislature has for years avoided applying the name 'corporation' to these associations, and designated them by the name of 'partnerships;' and it is not, in our opinion, unreasonable to conclude that it was not their intention to include them under the term 'corporations' in this (cumulative voting law, C. L. 1897, Sec. 8553) statute."

to corporations 20,-there can be no latitude for doubt concerning the legislative intent.

There are other incidents, peculiar to these associations, tending to confirm the view that they are not, strictly speaking, corporations.

(a) Unless the articles of association provide otherwise, a transfer of shares does not invest the transferee with membership and voting rights, in the absence of an election to membership21.

(b) The managers may act by concurrence of less than a majority (if there are five managers) and may bind the association without the formality of a meeting. In associations for buying and selling merchandise, the stockholders may, without consulting the managing board, confer upon a single manager the power to purchase merchandise, make contracts and issue. notes22. This may be accomplished without the formality of a stockholder's meeting 23.

There is no doubt that innovations of this kind might be, at the will of the legislature, embodied in the enabling act of a strictly corporate body. But, if it were done, it would be a departure from the settled policy of corporation law as developed in this State. Appearing, as they do, in the partnership associations statute, these divergences from fixed principles of corporation legislation serve to widen the line of demarcation between such associations and corporations.

The Supreme Court of Michigan has used language which might be readily construed as a denial that partnership associations are either partnerships or corporations+, but no apt word has been suggested for the characterization of such companies. For want of a better term, we may call them quasi-corporations25

20. Attorney General v. McVichie (ante), C. L. 1897, Sec. 1019410198.

21. Post Sec. 296. 22. Post Sec. 315. 23.

Post Sec. 315.

24. In Starr v. Shepard, 145 Mich. 302-306, Justice Ostrander said, in substance, of a partnership associa tion: "The company is not strictly a corporation and (is) not a partnership." In Staver & Abbott Mfg. Co. v. Blake, 111 Mich. 282, the Supreme Court expressly declined to follow

the Pennsylvania courts in holding members of a defectively organized partnership association charged with the liabilities of partners. In the course of that decision, Justice Grant said: "The statute contains not a sentence from which any individual or partnership liability can be inferred."

25. Partnership associations are sometimes designated as "joint stock companies.” In Massachusetts, Pennsylvania, and other jurisdictions. where such associations are treated

In Michigan these quasi-corporations are governed by the general principles of law applicable to private corporations 26. A general statute applicable to "all corporations" does not necessarily extend to them, but it seems that it may2. In the absence of any guiding decision upon this point, we may hazard the rule to be, that general corporation statutes will be deemed to include partnership associations, when not inconsistent with the peculiar character of such associations, nor with the manifest legislative intent, and when such inclusion will operate beneficially to the interests of the public29.

as modified partnerships, this designation is proper. A joint stock company is a quasi-partnership.-Bouvier Law Dict. But in Michigan partnership associations are governed by the law of corporations, hence the term quasi-corporations may be accurately applied.-Marshall's Corp., p. 51. See Staver & Abbott Co. v. Blake, 111 Mich. 282-286. However, in Pennsylvania, these associations are called quasi-corporations.-Briar Hill Coal & Iron Co. v. Atlas Works, 146 Pa. 290-293.

26. Rouse, Hazard & Co. v. Detroit Cycle Co., 111 Mich. 251-257; Staver & Abbott Mfg. Co. v. Blake, 111 Mich. 282; Wood v. Sloman, 150

Mich. 177; Armstrong, et al., V. Stearns, 16 D. L. N. 288-290. (Decided May 26, 1909).

27. Attorney General v. McVichie, 138 Mich. 387-389.

28. McKee v. City Garbage Co., 140 Mich. 497-503.

29. The term "corporation" as used in Art. XII of the Michigan Constitution of 1908, includes "all associations and joint stock companies." While, as pointed out in Attorney General V. McVichie (ante) this rule of construction does not extend to all legislative enactments, it does at least indicate the fundamental policy of our law-a policy of broad construction.

PART TWO-The Annotated Act

CHAPTER II.

THE ACT FOR PARTNERSHIP ASSOCIATIONS,
LIMITED.

$284. Title.

$285. Constitutionality.

$286. Partnership Associations, Limited, Law.-Sections Relating to

$304. Partnership Association, Limited, Law-Section Relating to

Executions.

$305. Constitutionality of Proceeding.

$306. Outline of Procedure.

$307. Partnership Association, Limited, Law.-Section Relating to

$313. Partnership Associations, Limited, Law.-Section Relating to By-Laws, Meetings and Management,

$314. By-Laws.

$315. Managers.

$316. Debts and Liabilities Exceeding $500.

$317. Cumulative Voting.

$318. Partnership Associations, Limited, Law-Section Relating to

Dividends.

$319. Impairment of Capital by Payment of Dividends.

$320. Partnership Association, Limited, Law.-Section Relating to

Loans.