§3] the capital, stock, or foundation of the business. In the case of commercial partnership the contributions will usually be in property, money or credit in industrial partnerships labor or service will usually be the contribution; while in professional partnership professional skill, standing or reputation may be the chief ingredient. As will be seen hereafter, the several contributions need not all be of the same kind nor of the same amount or value. Though usual and often said to be essential, it seems not to be indispensable that every partner shall make a contribution. 5. It contemplates the transaction of some lawful business, trade or occupation, in which the parties are to be co-owners and which they are to carry on as principals. 6. The purpose of the union is the pecuniary gain of the members. In several of the definitions, partnership is spoken of as a contract. It is, however, rather the result of the contract than the contract itself; it is the relation or association which the contract creates. §3. Partnership a commercial association.-Partnership in our modern English law is distinctively a business relation, and its object is the pecuniary gain of the members. This fact sharply differentiates it from a large class of associations organized for social, charitable, educational, religious or other similar purposes, such as social clubs, committees, lodges, fraternal societies, Christian associations, granges, and the like, of which something more will be said in a later section." In continental law the term partnership has often been applied more widely, including various forms of communal asso Christian Association, is not a partnership. Queen v. Robson (1885), 16 Q. B. Div. 137, Mechem's Partnership Cases, 1, Gilmore's Partn. Cas. 85. See, also, § 10, post. Neither is a temporary mutual protective association: Burt v. Lathrop (1883), 52 Mich. 106, 17 N. W. 716, Mechem's Partn. Cas. 4; Gilmore's Partn. Cas. 57; nor a Masonic lodge: Ash V. Guie (1881), 97 Pa. 493, 39 Am. Rep. 818, Mechem's Partn. Cas. 721; Burdick's Partn. Cas. 30; or an association of "Knights of Labor': Brown v. Stoerkel (1889), 74 Mich. 269, 41 N. W. 921, 3 L. R. A. 430; nor a "provisional committee' organized to promote the formation of a railway company: Batard v. Hawes (1852), 2 El. & Bl. 287, Burdick's Partn. Cas. 33; nor a "grange": Edgerly v. Gardner (1879), 9 Neb. 130, 1 N. W. 1004; nor a rural telephone association: Meinhart v. Draper (1908), 133 Mo. App. 50, 112 S. W. 709; nor a religious communistic society, Teed v. Parsons (1903), 202 Ill. 455, 66 N. E. 1044. An association of pilots who prescribe rules régulating the order in which pilots shall serve, and who pool and divide the fees earned by each, is not a partnership. Guy v. Donald (1906), 203 U. S. 399, 51 L. ed. 245, 27 S. Ct. 63. An athletic association organized merely to promote athletic exercises by its members would not be a partnership, but if organized to give athletic or sporting exercises or games as a business for the profit of its members, it would be: Bennett v. Lathrop (1889), 71 Conn. 613, 42 Atl. 634, 71 Am. St. R. 222, Mechem's Partn. Cas. * 723. So may be an association of fruit growers organized to market the products of its members and engaged in the business of selling fruit, Briere v. Taylor (1905), 126 Wis. 347, 105 N. W. 817. For similar reasons a defectively organized corporation will not be treated as a partnership if it was not organized for the purpose of carrying on a business for profit. Johnson v. Corser (1885), 34 Minn. 355, 25 N. W. 799. An association merely to adjust, prevent or distribute the losses of a business would not be a partnership. Aigen v. Boston, etc., R. R. Co. (1882), 132 Mass. 423; Irvin v. Nashville, etc., R. Co. (1879), 92 Ill. 103, 34 Am. Rep. 116. Mutual housekeeping arrangement not a partnership. Austin v. Thomson (1863), 45 N. H. 113. Co-operative Business or Trading Associations. On the other hand, a co-operative association organized to carry on business for gain, would be a partnership-often a large one. If it were organized merely to save money, e. g., to buy goods at wholesale and divide them among the members, it would not be a partnership. See § 13. But if organized to buy and sell goods for the profit of the members, it would be a partnership, even though lower prices were given to members than to non-members. Such partnerships are often organized with officers or managers to conduct the business, much like corporations. See Laney ciation which would not be deemed partnerships with us. Thus, a classification into civil and commercial partnerships is not infrequently found. Judge Story, writing in 1841, and following Watson and Collyer, though with less precision, says that at common law partnerships are sometimes divided into two classes: (1) Private partnerships and (2) Public companies, the latter of which are divided into incorporated and unincorporated, and are made to include several forms of association which would not now be regarded as partnerships at all. §4. Is a contractual relation.-Partnership is a contractual relation and not a status.10 It is created, limited, regulated and terminated, as between the parties themselves, by their contract or agreement. The law does not create partnership, or arbitrarily presume its existence.11 As has been seen in the study of agency,12 authority in one person to bind another as his agent v. Fickel (1899), 83 Mo. App. 60, Mechem's Cas. 83; Atkins v. Hunt (1843), 14 N. H. 205, Mechem's Cas. 79; McFadden v. Leeka (1891), 48 Ohio St. 513, 28 N. E. 874, Mechem's Cas. 280; Carter v. McClure (1896), 98 Tenn. 109, 38 S. W. 585, 60 Am. St. R. 842, 36 L. R. A. 282, Burd. Cas. 37, Gilm. Cas. 108; Davison v. Holden (1887), 55 Conn. 103, 10 Atl. 515, 3 Am. St. R. 40; Farnum v. Patch (1880), 60 N. H. 294, 49 Am. Rep. 313; Hodgscn v. Baldwin (1872), 65 Ill. 532; Schumacher v. Sumner Telephone Co. (1913), 161 Iowa 326, 142 N. W. 1034. Compare McDonald v. Fleming (1913), 178 Mich. 206, 144 N. W. 519. See also Joint Stock Companies, post, § 35. 8 See, for example, Maine's Village Communities. 9 Story on Partnership, § 76. 10 Bates on Partnership, vol. I, § 2. Mr. James Parsons, in his work on the Principles of Partnership (Boston, 1889), § 101, does indeed declare the contrary, distinguishing in this respect agency and partnership. Agency, he asserts, is not a status but a contractual relation, while partnership is the reverse. This is quoted, apparently with approval, in Haggett v. Hurley (1898), 91 Me. 542, 40 Atl. 561, 41 L. R. A. 362. It is believed, however, that the two relations are alike contractual. See Holland's Jurisprudence, (10th ed.), 136. 11 Phillips v. Phillips (1863), 49 Ill. 437, Gilm. Cas. 113; Re Gibbs' Estate (1893), 157 Pa. 59, 27 Atl. 383, 22 L. R. A. 276, Gilm. Cas. 91; Wilson v. Cobb (1877), 28 N. J. Eq. 177 (29 N. J. Eq. 361). Compare Phillips v. Phillips, supra, with Ratzer v. Ratzer (1877), 28 N. J. Eq. 136. 12 Mechem on Agency (2d ed.), $29. 13 is sometimes said to be created by law or by necessity; but this is not true in the law of partnership. One individual may, it is true, be held liable, by estoppel, to particular persons as though he were a partner, but this liability, as will be seen hereafter,1 is limited to those only in whose favor the estoppel operates, and does not make such individual an actual partner, nor amount to the general creation of a partnership between him and those with whom he was reputed to be associated. As a general rule there can be no partnership where the parties have not by their agreement created one. A present partnership may be formed by the immediate act of the parties without any preliminary contract to do so. There may also be a present contract to form a partnership at some future time. Contracts to enter into partnership rest upon the same foundations, such as consideration,14 competency of parties, and the like, as other contracts. Contracts of partnership need not be express: they may be implied from words or conduct as in other cases.15 § 5. Is a voluntary relation-The delectus personarum.-It is necessary also to emphasize the voluntary character of the relation. The law does not choose partners for people. So intimate and confidential is the relation, so important and dangerous, if abused, are the powers of one partner to subject the others to liability, that the law leaves the choice of partners to the parties themselves, and does not attempt to force a partner upon another without the latter's consent. This right to choose one's own partner-the delectus personarum, as it is often called-is properly regarded as one of the most important characteristics of partnership.16 13 Post, § 103. 14 There must be consideration. Mitchell v. O'Neale (1869), 4 Nev. 504; though the mutual promises of the parties will suffice as in other cases. 15 See Davis v. Davis [1894], 1 Ch. 393, Burdick's Partn. Cas. 12. 16 See post, § 57. 86. Is a partnership a distinct entity?-A partnership is sometimes said to be a distinct entity or legal person separate and distinct from the persons composing it as in the case of the corporation, but from a legal standpoint this can be true only in a limited sense.17 For most purposes the common law 17 This is partly a question of definition. The word entity is used in more than one sense. In the sense that a partnership is a distinct group of persons, whose legal rights, powers, duties, liabilities and disabilities are affected by the fact that they stand in that relation, a partnership is an entity. But in the sense that the partnership is a separate legal person having rights and liabilities of its own, distinct from those of all or any of the partners, a partnership is not, according to the generally prevailing view of English law, a distinct legal entity. "The law of England,' "" says Sir Frederick Pollock, "knows nothing of the firm as a body or artificial person distinct from the members composing it, though the firm is so treated by the universal practice of merchants and by the law of Scotland. In England the firm name may be used in legal instruments both by the partners themselves and by other persons as a collective description of the persons who are partners in the firm at the time to which the description refers, and under the rules of the supreme court actions may now be brought by and against partners in the name of their firm. An action between a partner and the firm, or between two firms having a common member, was impossible at common law, and until 1891 it remained open to doubt whether such actions were possible since the judi cature acts; but they are now expressly authorized by the rules of court. Nevertheless, the general doctrine that there is no such thing as a firm known to the law' remains in force." Digest of Law of Partnership (8th ed.), p. 23. In Drucker v. Wellhouse (1888), 82 Ga. 129, 8 S. E. 40, 2 L. R. A. 328, it is said that, while a partnership is not a person it is an entity. Persons are commonly classified as either natural, i. e. human beings, or artificial. "'Artificial', 'conventional', or 'juristic' persons,' says Mr. Holland (Jurisprudence, 9th ed., p. 91), "are such groups of human beings or masses of property as are in the eye of the law capable of rights and liabilities, in other words to which the law gives a status. Such groups are treated as being persons, or as sustaining the mask of personality. They are of two kinds: (1) 'Universitates personarum', such as the state itself; departments or parishes; collegia; churches. (2) 'Universitates bonorum', such as funds left to 'pious uses' without a trustee. So the estate of an intestate before administration; the estate of а bankrupt. * "Such juristic or artificial persons come into being when-(1) there exists a group of persons, or mass of property, as the case may be, and (2) the law gives to the group or mass in question the char |