"Such legislation, of course, either is or is not inconsistent with the treaty which the Government has made with Russia. If it is not inconsistent with it. then, of course, no question would arise here. * * * But if it be inconsistent (and that must be the ground upon which the plaintiffs proceed here), then we are led to this inquiry: Is the force and effect of an act of legislation, distinct and unqualified in its terms, and plain in its meaning, valid if it be found that it violates or is inconsistent with a prior treaty of the United States with a foreign nation?"

In answer to this question the Judge further said:

* * *

"I understand it to be conceded, and if it be not, I should be constrained to hold that the legislative department of this Government may pass any law it pleases (if it be otherwise constitutional), notwithstanding it conflicts, and notwithstanding to whatever degree, greater or less, it conflicts with an existing treaty with a foreign nation. I speak now of the question of power. * **If then Congress, by legislation inconsistent with a treaty, creates a rule of conduct for its citizens, a rule for the guidance of its courts, the only question is: Has it enacted a law which operates to annul or operates in disregard of the provisions of a treaty? As I before observed, if this act does neither then there is no question here. If it does either or both, then it seems to me within the constitutional power of Congress. * * *They [Congress] may render it [a treaty] inoperative by legislation in contradiction of its terms, without formal allusion at all to the treaty, and generally they may legislate as if no such treaty existed in modification or alteration of what by force of the treaty has been the law heretofore, thus modifying the law of the land without denying the existence of the treaty or the obligations thereof between the two governments as a contract, and answer therefor to such foreign government, or meet its reclamation or retaliation, as may be necessary."

The case of Taylor et al. v. Morton, 2 Curtis, 454, was that of an action brought against the collector of the port of Boston, to recover a portion of the duties exacted under the Tariff Act of 1842, on the ground that the act was in conflict with the commercial treaty of 1832 between the United States and Russia. Mr. Justice Curtis said: "If an act of Congress should levy a duty upon imports which an existing commercial treaty declares shall not be levied, so that the treaty is in conflict with the act, does the former or the latter give the rule of decision in a judicial tribunal of the United States, in a case to which one rule or the other must be applied?" After quoting the clause of the Constitution which defines "the supreme law of the land," he proceeded to say:

"There is nothing in the language of this clause which enables me to say that in the case supposed the treaty, and not the act of Congress, is to afford the rule. Ordinarily, treaties are not rules prescribed by sovereigns for the conduct of their subjects, but contracts by which they are to regulate their own conduct. This provision has made treaties a part of our municipal law. But it has not assigned to them any particular degree of authority in our municipal law, nor decided whether laws so enacted shall or shall not be paramount to laws otherwise enacted. * ** To refuse to execute a treaty for reasons which approve themselves to the conscientious judgment of the nation is a matter of the utmost gravity and delicacy; but the power to do so is prerogative, of which no nation can be deprived without deeply affecting its independence. That the people of the United States have deprived their Government of this power in any case I do not believe. That it must reside somewhere, and be applicable to all cases, I am convinced. I feel no doubt that it belongs to Congress. * * * Legislative power is applicable to such laws [treaties] whenever they relate to subjects which the Constitution has placed under that legislative power."

Mr. Justice Curtis, in this case, sustained the law of Congress, notwithstanding its conflict with the treaty, and to the extent of the conflict held the latter as a law to be repealed by the former.

In 1866 the United States concluded a treaty with

the Cherokee nation of Indians, in the tenth article of which it was provided that "every Cherokee and every freed person resident in the Cherokee nation shall have the right to sell any products of his farm, including his or her live-stock, or any merchandise or manufactured products, and to ship and drive the same to market without restraint, paying any tax thereon which is now or may be levied by the United States on the quantity sold outside the Indian Teritory." 14 U. S. Stat. at Large, 799.

Section 107 of the Internal Revenue Act of July 20, 1868, provides "that the internal revenue laws imposing taxes on distilled spirits, fermented liquors, tobacco, snuff and cigars, shall be held and construed to extend to such articles produced anywhere within the .exterior boundaries of the United States, whether the same shall be within a collection district or not." 15 U. S. Stat. at Large, 167.

In The Cherokee Tobacco Case, 11 Wall. 616, the question before the Supreme Court of the United States was whether the above section of the law of 1868 repealed the tenth article of the treaty of 1866, between the United States and the Cherokee Indians, or whether this section of the law was rendered null and void by the treaty. Mr. Justice Swayne, in stating the opinion of the court, assumed that Congress has power to extend the operation of United States law into the Indian Territory, and that such was its purpose in respect to the items specified in the act of July 20, 1868. To the objection that the act is in conflict with the prior treaty of 1866, he replied:

* * a

"Undoubtedly, one or the other must yield. The repugnancy is clear, and they cannot stand together. It need hardly be said that a treaty cannot change the Constitution, or be valid if it be in violation of that instrument. This results from the nature and fundamental principles of our Government. The effect of treaties and acts of Congress, when in conflict, is not settled by the Constitution. But the question is not involved in any doubt as to its proper solution. A treaty may supersede a prior act of Congress, and an act of Congress may supersede a prior treaty."

The court sustained the law, and referred approvingly to the cases of Foster v. Neilson, The Clinton Bridge, and Taylor et al. v. Morton, supra, as cases in which these principles had been applied.

The obligations of the Government to the foreign nation whose interests or rights may be affected by legislation inconsistent with a prior treaty form an international question entirely distinct from the character and operation of the treaty as a municipal law within the United States; and with this question courts have nothing to do. The treaty contract being thus violated or set aside, it devolves upon the political department of the Government to meet whatever issue may arise therefrom. The law of nations does not require that treaties shall possess the character of municipal laws. This is a peculiarity of our own Constitution for special and local reasons; and hence, if the Constitution were so amended as to dispossess treaties of this character, the change would furnish foreign nations with no just ground of complaint. It is enough for them that the Government preserves its treaty faith with them, and whether this is done by making treaties a part of the supreme law of the land" or not, is a question that belongs exclusively to the people of the United States. Foreign nations have nothing to do with this question.

The fact that treaties are a part of our supreme municipal law, and that the legislation of Congress is another part of the same law, and that the two do not come into existence by the same agency, implies in the political system of the United States two distinct lawmaking and law-repealing powers. The President, with the advice and consent of the Senate, can, by making a treaty, indirectly enact a supreme law bind

ing upon courts; and so also Congress, by legislation within the scope of its powers, can directly enact a supreme law equally binding upon courts. Such a law may be enacted in either way, and according to the authorities above cited, it may be modified or repealed in either way. The authority is that of the people of the United States, and equally so whether exercised in one form or the other.

The President and the Senate cannot set aside or modify a law, established through the medium of a treaty, except by making another treaty abrogating or changing the former one. To this process the foreign nation would be a contracting party, and without its consent the result could not be gained through a treaty, however urgent might be the necessity. If then Congress could not legislatively modify or repeal a treaty as the law of the land, and hence as the rule for courts, there would be no escape from its provisions under any circumstances, except with the consent of the foreign government with which the treaty was made. Surely, the people of the United States cannot accept such a consequence. No independent nation can accept it

Attorney-General Crittenden, 5 Op. Att.-Gen. 345, very justly observes: "The supreme political and legislative power of this country is placed in the hands of the Government of the United States, under the Constitution, and its acts are uncontrollable, except only by that Constitution, and that Constitution does not say that Congress shall pass no law inconsistent with a treaty, and it would have been a strange anomaly if it had imposed any such prohibition. There may be cases of treaties so injurious, or which may become so by change of circumstances, that it may be the right and duty of the Government to renounce and disregard them. Every government must judge and determine for itself the proper occasion for the exercise of such power; and such a power, I suppose, is impliedly reserved by every party to a treaty, and I hope and believe belongs inalienably to the Government of the United States. It is true that such a power may be abused; so may the treaty-making power and all other powers."

The fact that a treaty is declared to be a part of "the supreme law of the laud," furnishes no objection to this conclusion as to the modifying or repealing power of Congress. The truth is that with the exception of the Constitution itself, there is no supreme law of the land which excludes the power of the President and the Senate to change it by a treaty, if exercising this power within its proper limits, or which excludes the power of Congress to change it, if legislating within the scope of its constitutional powers. The attribute of supremacy attached to the result of the action does not preclude future action changing that result. Congress, within the sphere of its powers, may legislate as if no treaty existed; and so the President and the Senate, subject to the limits fixed by the Constitution, may make treaties as if no legislation existed. The treaty power and the legislative power are within their constitutional scope independent of each other, and neither is derived from or superior to the other. By either the law of the land may be changed. The supremacy of this law, while existing, is not at all inconsistent with its modification or repeal by the authority provided for in the Constitution.

Chancellor Kent overstates the matter when he says: "All treaties made by that power [the treaty power] become of absolute efficacy, because they are the supreme law of the land." Com. (3d ed.) vol. 1, p. 166. The laws of Congress are also the supreme law of the land, as much so as treaties, and yet they are not of "absolute efficacy," as against the power of treaties or that of Congress to change them. The rank of supremacy in both cases is just equal; but in neither does it exclude or impair the exercise of the treaty

power vested in the President and the Senate, or the exercise of the legislative powers vested in Congress. The question considered in this article is not when or for what reasons Congress should exercise the power of modifying or repealing treaties, either directly or indirectly, or when or for what reasons the President and Senate should make treaties inconsistent with an existing law of Congress, but rather what is the legal effect when legislation is inconsistent with a prior treaty, or a treaty is inconsistent with prior legislation. The authorities above cited answer this question in both of its aspects. A treaty," says Mr. Justice Swayne in The Cherokee Tobacco Case, supra, may supersede a prior act of Congress, and an act of Congress may supersede a prior treaty." Neither can supersede the Contitution, and either, if acting within its constitutional limits, may supersede the other. In the case of conflict between the two the last expression of sovereign authority is the one that prevails.

66

ADMINISTRATION UPON ESTATE OF LIVING PERSON VOID.

TENNESSEE SUPREME COURT, APRIL, 1880.

D'ARUSMONT V. JONES.

Under a statute authorizing administration upon the estates of deceased persons, held, that the probate court is without authority to issue letters of administration upon the estate of a living person, and its acts in doing so will be wholly void.

BILL by Sylva D'Arusmont to have satisfaction of

four notes executed to her. Sufficient facts ap pear in the opinion.

MCFARLAND, J. The question in this case is the validity of an administration upon the estate of a living person.

The complainant files this bill to have satisfaction of four notes of $1,000 each, executed to her by Wm. C. Harrison on the 15th January, 1861, and secured by a deed of trust on a tract of land in Shelby county, which she on that day had sold and conveyed to said Harrison.

She states that soon after the date of said transaction she left the State of Tennessee and resided for several years in the States of the North, and afterward in Europe, returning to this State shortly before the filing of this bill, 25th April, 1874. Upon her return she discovered that during her absence, to wit, on the 10th of August, 1869, the d endant, David Whitly, had procured letters of administration upon the estate from the county court of Shelby county, upon the pretext that she was dead, and as such administrator had filed a bill in the Chancery Court of said county against the personal representatives and devisees of said Harrison, who had died, and the heir of the trustee in the deed of trust (who had also died) to have satisfaction of said notes, alleging that they had been lost or mislaid.

The cause was compromised, and a decree rendered in favor of said Whitly for $3,500, upon condition that he execute a bond with sureties to indemnify the estate of said Harrison, or the devisees of said land, to the extent of said sum of $3,500, against all claim that might be set up by complainant, if alive, or by any assignee of said note. The bond was executed and the money paid. The prayer of the bill is to have satisfaction of the notes out of the trust property, but that Whitly and his sureties be held liable upon his aforesaid bond to the extent of the penalty thereof, in exoneration of the land. It is conceded that the material allegations of the bill have been established, but it is maintained that Whitly acted in good faith, and with due caution, upon the belief that complain,

ant was in fact dead, a belief justified by the fact that she had been absent for more than seven years, and the most diligent inquiries among her friends and acquaintances could discover no trace of her. And it is insisted for the defendants that the administration of Whitly should be held so far valid as to constitute a protection to the innocent parties who, in good faith, paid to him money due the complainant. A similar case has never before arisen in this State so far as we know. It is a question that has recently attracted some attention. Previous to the decision of the Court of Appeals of New York, in 1875, in the case of Rodri gas v. East River Savings Institution, 63 N. Y. 460, it seems not to have been doubted that such an administration would be absolutely void. Chief Justice Marshall said such an act, "all will admit, is totally void" (Griffith v. Frazier, 8 Cranch, 9), and there are numerous dicta and several decisions to the same effect. Pinson v. Ivey, 1 Yer. 306; Allen v. Dundas, 3 Tenn. 125; Wilson v. Frazier, 2 Humph. 30; Jochumsen v. Suffolk Bank, 3 Allen, 87; 2 Taylor on Evidence, $$ 1490 and 1523.

The case in 63 N. Y., before referred to, raised the direct question. Administration had been granted upon the estate of one who had been absent, and not heard from for more than seven years, and money collected from his debtor. It turned out that he was not in fact dead, and the question was whether the payment made by the debtor was a protection against a sound demand. The judges were divided in opinion -four to three-the majority holding the payment a protection.

The decision has been severely criticised by Judge Redfield in 15 American Law Register. It is fair, however, to say, that the opinions present that side of the question with all its force, and show that at least something may be said in its favor. The argument may be briefly stated thus: Upon proof of death the surrogate was compelled to act and grant administration-proof of seven years' absence without being heard from was prima facie evidence of death which the surrogate might be unable to rebut, and therefore he was compelled to act and grant the letters of administration-armed with these letters the administrator could demand payment, and the debtor could not resist, and therefore it being a payment compelled by law, the debtor ought to be protected, especially as it is the act of the supposed decedent in remaining absent without communicating with his friends for more than seven years that causes the injury, and consequently he, rather than the debtor, ought to suffer. The decision, however, was to some extent placed upon the statutes of New York, which were assumed to be peculiar in this respect- that is to say, before administration can be granted the fact of the person dying intestate shall be proven to the satisfaction of the surrogate, who shall examine the person applying touching the time, place and manner of the death, and may examine any other person, and for that purpose compel their attendance as witnesses. While it is conceded that in general the finding by the court of the fact upon which the jurisdiction depends is not conclusive of the jurisdiction, yet it is maintained that as in this instance the court was required to hear evidence and determine the facts, the determination must be conclusive until revoked, so far as concerns third persons who had acted upon the faith thereof.

It does not seem clear that an administration granted under such a statute would in this respect be different from administration granted under a statute simply authorizing the granting of administration upon the estates of deceased persons, but it is unnecessary in the present case to pursue this branch of the inquiry. The force of the argument in favor of the validity of the administration seems to apply especially to a case of this character, where the assumption of death rests

upon the fact of seven years' absence without being heard from, and the hardship of requiring a debtor, who has recognized an administrator appointed under such circumstances, liable to a second payment seems, peculiarly pointed.

It must, however, be in principle immaterial what the proof of death may be as to the effect of the judgment. Whether the court find or assume the fact of death upon proof of seven years' absence, or upon testimony of witnesses directly to the point, the question must be the same, that is to say, it is the finding or assumption of the fact of death by the probate court, conclusive until revoked by the same court, or reversed on appeal, for we have no statutes authorizing administration to be granted upon proof of seven years' absence without being heard from. It is simply a common-law rule of evidence, and it has no more force than any other evidence that may turn out to be untrue; administration granted upon such evidence is no more lawful than if granted upon false testimony of witnesses. It may be the misfortune of the parties in interest in either case, that for the time being they are unable to show the real truth. In such a case there is real hardship in requiring a debtor to pay the second time, but such is always the effect of holding, as courts are often compelled to do, that former judgments have been rendered without jurisdiction.

The defendants in this case were unable to defeat the demand of Whitly, because they were unfortunately unable to prove the real truth-such misfortunes occur. The hardship to the debtor cannot be regarded greater than to hold the creditor bound by an administration of his estate in his life-time. To deprive him of his property and rights by a proceeding of this character, to which by no sort of construction can he be regarded as a party, is violation of first principles. It is said, however, that it is the fault of the supposed decedent in remaining absent for seven years without communicating with friends that gives rise to the presumption of death, and causes the injury, and he ought, therefore, to be bound by his own acts. The seven years' absence may be willful, or it may be the result of insanity, imprisonment or other misfortune. The failure of friends and acquaintances to be informed as to the residence of the absent one, or that he still lives, may be the result of accident or other cause. In what cases the conduct of a person in remaining absent, and conniving at the acts of a pretending administrator, should be held fraudulent and an estoppel, it is unnecessary to inquire, as such is not the present

A debtor in a case like the present could always obtain the indemnity which in this case was obtained by applying to a Court of Chancery, that is, a bond of indemnity against the contingency of the creditor returning alive-an indemnity that perhaps ought to be provided by statute, and there could be no more hardship in requiring the debtor to look to such a bond for indemnity than in requiring the creditor to do so. The money, when thus paid, should be recovered back either by the debtor who had paid it, or by the creditor who returns alive; and if the security of the bond fail, it would be as great a hardship, to say the least of it, to require the creditor to lose it as to throw the loss upon the debtor.

Therefore the question of hardship is out of the way, and the fact that the administration was granted upon proof of seven years' absence forms no exception to the general rule-and we return to the question whether administration upon the estate of a living person is valid. Has a probate court, under our statute, juris

diction to grant administration otherwise than upon the estates of deceased persons? Our statutes have not the supposed peculiarity of the statutes of New York; they simply authorize administration upon the estates of deceased persons, and if the person be not dead, the court would be acting ultra vires to appoint an administrator. But it is said the probate court has jurisdiction to ascertain the fact of death, and its judgment finding that fact is conclusive until revoked or reversed. The general principle is, that the jurisdiction being conceded the judgment is conclusive of all matters involved; but if the jurisdiction be disproved, then the judgment is void for all purposes. If it be conceded that the jurisdiction rests upon the existence of a particular fact, then it will not do to say that the finding of that fact by the court is conclusive of its own jurisdiction—for this would be, to use a common expression, "reasoning in a circle." The judgment is conclusive if the court had jurisdiction, and its judgment that it had jurisdiction is conclusive of the jurisdiction. There may be in some cases confusion as to what constitutes the jurisdictional facts, but this would seem to be about as clear an illustration of it as could be found: That a probate court has assumed that a certain person is dead, and has granted administration upon his estate, when, in fact, he was not dead. A similar illustration is given by Chief Justice Marshall; he says: "If by any means whatever a prize court should be induced to condemn as prize of war a vessel which was never captured, it could not be contended that the condemnation operated as a change of property. The proper distinction is illustrated in the case of Allen v. Dundas, 3 T. R. 125, where it was held that payment to one named as executor in a forged will which had been presented and allowed in the prerogative court was a protection against the demand of one who had procured the proceedings on the forged will to be set aside and himself appointed administrator, this upon the ground that the person being dead the court had jurisdiction; but the judge said that if the person was not in fact dead, the whole proceedings would be void- -so that the jurisdiction rests upon the fact of death, and this being clearly shown untrue, it must result that the entire proceeding was without jurisdiction and void. For at least it sounds almost absurd to say that any man is to be bound by the judgment of a probate court that he is dead. The argument that the court has jurisdiction to ascertain the fact of death is fallacious. For this must assume that the court may decide the question either way, and if it conclude that the person is not dead, then it has no jurisdiction for any purpose. While the court may hear evidence of the death, the fact is generally assumed, and if the court undertake to put its finding of the fact in the form of a judgment, it gives it no greater validity. This conclusion is sustained by the great weight of authority; the direct question was fully considered in a case precisely similar by the Supreme Court of Massachusetts, and this view held by the unanimous opinion of the court. Jochumsen v. Savings Bank, 3 Allen, 87. The principle is directly involved in the case of Thompson v. Whitman, 18 Wall. 457. By the laws of New Jersey it was made unlawful for any one not at the time a resident or inhabitant of the State to gather clams, oysters or shell-fish in the waters of that State, and the law authorizes the seizure of the vessel and its forfeiture, which may be declared by any two justices of the peace of the county in which the seizure occurred.

The suit was in the United States court against the sheriff who had carried away the vessel, the defense was the judgment of condemnation of two justices of the peace of New Jersey, which judgment recited the fact that the vessel had been seized in their county. This was held not conclusive, and it being shown that the seizure was not in the county, the judgment of con

demnation was granted in two different counties about the same time. Judge Reese said the letters granted in the county other than the county of the intestate's residence were void; other similar cases are referred to in the case of Jochumsen v. Savings Bank, 3 Allen, 87. If the judgment of the probate court as to the residence of the intestate is not free from a collateral attack, it can hardly be said that the judgment of the court as to the death of the party can stand upon a higher ground. In fact, so far as our researches have gone, the case of Rodrigas v. East River Savings Institution stands alone, and even that decision seems to have been rendered doubtful upon a second hearing of the case. See Melia v. Simmons, 19 Alb. L. J. 198. As

a further argument against the validity of the administration we need only see to what it would lead. If the administration was valid until revocation, as argued in the present case, then it must result that the decree of the Chancery Court in the bill filed by Whitly to collect these notes was likewise conclusive, for in that view it was a bill filed by one who was for the time being properly authorized to act as administrator to collect assets due the estate, the proper defendants were made, and the court had jurisdiction of the subject-matter, and the decree rendered in the cause must in that view be held conclusive upon all parties. But suppose the decree had been in favor of the defendants in the cause, and no such notes had ever been executed, or that they had been paid, would the complainant in the cause be bound by the adjudication? Is it possible that she could thus lose her property and rights by a proceeding to which she was in no sense a party. The decree was in fact for only part of the debt. Without attempting to further follow the discussion into refinements it is sufficient to say that it will at last bring us back to the plain common-sense view of the question, to which we think there is no sufficient answer, and that is, that there is no law for administrating upon one's estate until after he is dead, and that no living man is bound by the adjudication of a court that he is dead. It might be different if we had a statute such as exists in Rhode Island, or such as the New York court seems to have construed theirs to be, providing that after an absence for a given time one's estate may be administered as if he were dead, subject only to his right to reclaim the proceeds, in the event he return; even then it would be a question whether this would not be depriving a man of his property without due process of law. See Albany Law Journal of 15th May, 1880, p. 383. But at any rate, we have no such statute. We hold the entire proceedings void. We also hold Whitly, and his sureties on his bond of indemnity, liable to the extent of the penalty for the money received by him. The amount thus realized will be paid to complainant in exoneration to that extent of the trust property. 1 Lea, 586. It appears that some of the persons to whom Whitly distributed the fund have voluntarily paid to complainant part of the amount; an account of this, as ordered by the chancellor, will be taken, and the amount credited on the decree on the indemnity bond. Under the circumstances we disallow interest during the war, and until 1st June, 1865, in accordance with our holding in similar cases, upon the ground that the parties were for the time separated by the lines of the hostile armies, and occupying toward each other the relation of public enemies between whom commercial intercourse was forbidden. With this modification the decree of the chancellor will be affirmed, and the cause remanded, and the costs of this court divided.

Freeman, J. dissented.

MCFARLAND, J. (upon a petition for a rehearing). We have been asked to rehear this case on account of its novelty. The only additional argument offered is a review of the question in the American Law Review

of May, 1880. This article concedes that the weight of authority is in favor of our conclusion, and refers to additional authorities in its support that we have not had access to. Moore v. Smith, 11 Rich. Law (S. C.) 569; Melia v. Simmons, 45 Wis. 334. The author only undertakes to say that something may be said on the other side of the question, and puts forth somewhat doubtingly the suggestion that the jurisdiction does not depend upon the fact of death, but upon the allegation of the fact in the application for letters of administration. If disposed to enter further into the discussion we think it could be shown that this position is unsound, but we are content to rest our conclusions upon the reasons and authorities already given. The other points in the petition have been fully considered in the foregoing opinion. As to the interest after June, 1865, while it is true that complainant was absent with the notes in her possession, so that they could not have been paid, yet it is not shown that the defendants were ready, or desired to make payment, or that they lost the interest.

Petition for rehearing dismissed.

WHEN JOINT ENTERPRISE IS NOT PARTNERSHIP.

RHODE ISLAND SUPREME COURT, MAY 29, 1880.

BOSTON & COLORADO SMELTING Co. v. SMITH. Agreement under seal between A and B by which B was to loan A $5,000 for one year, or indorse his note for that amount for that time, and also indorse his notes to an additional amount not exceeding $2,000 if B thought such sums required for A's business. For this A was to pay B ten per cent of his net business profits of the year, and two per cent of his net profits for each $1,000 indorsed for him over said sum of $5,000. A also agreeing to conduct his business to the best advantage, and to keep accurate accounts thereof to be at all times open to B's examination. IIeld, an executory agreement which if carried into effect would make A and B copartners neither as between themselves nor as to third persons. Held, further, that the lenders having no voice in the management of the business and no interest in the capital, the agreement was for a loan of money or credit in which a percentage of profits took the place of interest. Held, further, that such a contract did not, according to the later English cases, create a partnership at common law.

A brought assumpsit against B and others whom A claimed to be copartners of B for goods furnished them under a sealed agreement executed by A and B. Held, that the action would not lie. As against B, A's claim rested on a specialty, and as B alone could not be made liable in assumpsit, so B in company with others could not be held in assumpsit.

Semble, that if a partnership existed between B and his codefendants, the partners who did not execute the sealed agreement could only be reached by a bill in equity filed by A.

ASSUMPSIT. Heard by the court under the sub

joined stipulation.

George Fuller aud James M. Ripley, for plaintiff.
Tillinghast & Ely, for defendant Smith.
Edwin Metcalf, for the other defendants.

DURFEE, C. J. This is an action of assumpsit for goods sold and delivered by the plaintiff corporation to the defendants, who are alleged to have been copartners in business at the time of their delivery. The names of the defendants are, first, William T. Smith, and second, certain persons constituting the firm of Mason, Chapin & Co., to wit: E. Philip Mason, William P. Chapin, Charles S. Bush, and Samuel L. Peck. Two questions, one of which may be decisive of the case, are submitted to the court for determination, preliminarily to the full trial. The first is, whether

the following agreement between the defendant William T. Smith and the other defendants is evidence of a copartnership between them.

"This indenture, made this twenty-fifth day of April, in the year eighteen hundred and seventy-eight, between William T. Smith, of Providence, in the State of Rhode Island, of the first part, and Mason, Chapin & Co., of the said Providence, of the second part, Witnesseth: That in consideration of the agreements herein made, the said party of the first part covenants with the said parties of the second part, that on the first day of May, in the year eighteen hundred and seventy-nine, he will pay to them ten per centum of the net profits of the business, carried on during the year preceding the day last named, under the name and style of 'Elmwood Chemical Works, William T. Smith, Treasurer,' in consideration of their loan to him of $5,000, or of their indorsements for him to that amount, for and during the year aforesaid, and will also pay to them two per centum of said net profits for each sum of one thousand for which they may indorse for him during said year in addition to said sum of $5.000; and that he will conduct said business during said year to the best advantage, and keep accurate accounts thereof upon books which shall be at all times open for examination by them.

"And that the said parties of the second part, in consideration of the foregoing agreement, covenant with the said party of the first part: that they will loan to him $5,000 for the term of one year, from the first day of May, eighteen hundred and seventy-eight, or indorse his note for that amount, renewable from time to time during said term, and will also during said year, if in their judgment required for the proper management of his business aforesaid, indorse his notes to an amount not exceeding $2,000 in excess of said $5,000.

"In witness whereof, the said parties hereto set their hands and seals, the day and year first above written.

"WILLIAM T. SMITH, [Seal.] "MASON, CHAPIN & Co. [Seal.] "Executed in the presence of Edgar G. Robinson, witness to both signatures."

The contract, it will be noted, is executory, and of course does not create a partnership between the parties to it until something is done to carry it into effect. We presume, therefore, that the meaning of the question put to us is, Is the contract such that it would create a partnership between the parties to it, if carried into effect according to its terms, or such that if so carried into effect, it would render the parties to it liable as copartners to third persons? We will consider the question as if so propounded.

If we regard the contract simply as a contract between the parties to it, to be construed as contracts are usually construed, so as to carry out their intention, we think there can be no doubt that it can only be considered a contract for a loan of money or credit in consideration of a percentage of profits in lieu of in terest. It gives the lenders no voice in the management, and no interest in the capital, of the business. It gives them only a percentage of the profits for a single year in a continuing business. It is true they are to have the right to inspect the books, but only for information. The contract calls the business his, i. €. the borrower's, and it remains exclusively his as much during the continuance of the loan as before or afterward. The contract, as between the parties to it, is therefore simply a contract for a loan of money or credit, and if, when carried out, it renders them liable as copartners, it is not because they have agreed to become such, but independently of their agreement, by force of an arbitrary or artificial rule, or by operation

of law.