*

ley's Heirs v. Calhoun, 12 Leigh. 264; Sikes v. Work, 6 Gray, 433; Gordon v. Gordon, 49 Mich. 501; Moody v. Rathburn, 7 Minn. 89; Paige v. Paige, 71 Iowa, 318; Parsons on Part. (4th ed.) sec. 266; Hanchett v. Blanton, supra. The general doctrine of all these cases is, that a purchase of the land with partnership funds is necessary to make it firm property. Parsons in his work on Partnership (4th ed.) says: 'Although it (real estate) be held in the joint name of two or more persons, if there be no proof that it was purchased with partnership funds for partnership purposes, it will be considered as held by them as joint tenants, or tenants in common; So, if not paid for by partnership funds, then it is probably his property who does pay for it, whatever use he permits to be made of it.' (Secs. 265, 266.) In Hanchett v. Blanton, supra, the Supreme Court of Alabama says: 'Steering clear of all cases of fraud or of the use by one partner, without the approbation of his associates, of partnership funds in the acquisition of real estate, the two facts must concur to constitute real estate partnership property-acquisition with partnership funds, or on partnership credit, and for the uses of the partnership.' In Thompson v. Bowman, supra, the Supreme Court of the United States says: 'In the absence of proof of its purchase with partnership funds for partnership purposes, real property standing in the names of several persons is deemed to be held by them as joint tenants, or as tenants in common.' (Buchan v. Sumner, 2 Barb. Ch. 165.)

"There are cases which hold, that even though the land was originally bought by the several partners with their individual funds, and deeded to them as tenants in common, yet it will be regarded in equity as firm property where it is improved out of partnership funds for firm purposes and actually used for such purposes, or where the firm puts valuable and permanent improvements upon it for firm purposes, and which are essential to the firm. In some instances the land is held to be the property of the partners, and the improvements to be

the property of the firm. (1 Bates on Law of Part. secs. 281, 282.) The use of the property is not conclusive of its character as real estate or personalty, but is only evidence of the intention of the parties. (Idem, sec. 285.) When the intention of the partners to convey the land into firm property is inferred from circumstances, the circumstances must be such as do not admit of any other equally reasonable and satisfactory explanation. (Parsons on Part. sec. 267.) And where it is sought to show a conversion of the land into personalty by agreement of the partners, such agreement must be clear and explicit. (17 Am. & Eng. Enc. of Law, page 954, and cases cited.)

"The weight of authority seems to us to support the position that, where persons, who afterwards become partners, buy land in their individual names, and with their individual funds, before the making of a partnership agreement, the land will be regarded as the individual property of the partners, in the absence of a clear and explicit agreement subsequently entered into by them to make it firm property, or in the absence of controlling circumstances which indicate an intention to convert it into firm assets. We do not think that an application of this rule to the facts of the present case shows the real estate here in controversy to be firm property. The testimony proves affirmatively that there was no agreement, written or verbal, to put the land into the firm as a firm asset, and that it was treated by the parties as individual property."

Question 584: How was the land in the case above acquired! Was it used for firm purposes? Were any funds of the partnership used in reference to it? How? Did the Court hold it to be partnership property?

Case 585. Uniform Partnership Act, Sec. 8 (1) (2). "(1) All property originally brought into the partnership stock or subsequently acquired by purchase, or otherwise, on account of the partnership is partnership property.

"(2) Unless the contrary appears, property acquired with partnership funds is partnership property."

§ 584. (Partnerships, Sec. 25.) Nature of partner's interest in firm property.

Case 586. Uniform Partnership Act, Secs. 24, 25, 26. "Sec. 24. The property rights of a partner are (1) his rights in specific partnership property, (2) his interest in the partnership, (3) his right to participate in the management.

"Sec. 25. A partner is co-owner with his partners of specific partnership property holding as a tenant in partnership.

"Sec. 26. A partner's interest in the partnership is his share of the profits and the surplus, and the same is personal property.”

PART III

MUTUAL RIGHTS AND OBLIGATIONS OF

PARTNERS

CHAPTER 70

RIGHTS OF PARTNERS IN MANAGEMENT OF FIRM AND MUTUAL OBLIGATIONS

§ 585. Partner's right to be active participator.

§ 586. Right of majority to govern.

§ 587. General rule of conduct of partner.

Partner cannot oppose his own interests to those of firm.

§ 588.

§ 589.

Right of partner to deal openly with firm.

§ 590. Right of partner to sue firm.

§ 591. Right of partner to compensation, interest, etc.

§ 585. (Partnerships, Sec. 26.) Partner's right to be active participator.

Case 587. Uniform Partnership Act, Sec. 18 (g). "All partners have equal rights in the management and conduct of the partnership business."

Question 587: A contributes $5,000,.B, $1,000, C, his services. At a meeting of the partnership a question comes up to be voted upon, and A contends the voting power is 5 to 1 as between A and B and C no voice. Is he right?

(Note: Partners are not in simili casu with shareholders of a corporation, but more comparable to a board of directors. Of course a special agreement in any case would be binding. Sometimes partnerships are created with voting members and nonvoting members, and the voting power of voting members may be specifically provided for.)

§ 586. (Partnerships, Sec. 27.) Right of majority to govern.

Case 588. Uniform Partnership Act, Sec. 18 (h). "Any difference arising as to ordinary matters connected with the partnership business may be decided by a majority of the partners; but no act in contravention of any agreement between the partners may be done rightfully without the consent of all of the partners." Question 588: In partnership business does the majority govern?

Case 589. Markle v. Wilbur et al., 200 Pa. 457.

Facts: Bill for an accounting. The bill set forth a partnership among several parties for the purpose of mining coal upon extensive lands leased by the firm. The partnership was to begin January 1, 1890, and to continue for twenty years. The bill alleges that expenditures were made and other acts done without authority. Defendants answer that the majority members consented to such acts. A part of the head note to the case reads as follows:

"The shares were divided into sixteenths, and the term of the partnership was for twenty years. On a bill in equity by two of the partners representing three and one-half sixteenths against the other partners for an account, it appeared that one of the plaintiffs was a woman, and the other was engaged in banking in a distant state. Three of the defendants were practical men in the coal business and one of them who acted as manager or superintendent was an educated mining engineer of large experience in his profession. The evidence showed no bad faith or fraud in the management of the business. The plaintiffs claimed that the defendants should account for a very large expenditure on a tunnel over a mile long, for the cost of a dwelling house for the superintendent, for a salary of $10,000 a year of an assistant superintendent, and for various other matters of expenditure. The evidence showed that the large expenditure for the