(Continual from Page 4)
succession.
THE HONGKONG TELEGRAPH.
EXTRA
HONGKONG, FRIDAY, FEBRUARY 20, 1914.
SHEWAN, TOMES & CO. Lords, at the end of paragrah 13 the arrangement.
is a provision with regard to the your Lordship's functions are include goodwill it did not fact, generally been got out in the document. In clauss 13 the The terms previously arranged in I submit it is hold although it may balance-sheet bas, as a matter of the meaning of the phrase in business property and B'goodwill, price. It says that the price to restricted to the interpretation of in regard to that particular agree the June of the preceding year, point has been raised by my every case where goodwill is re the Company's because it hus to share of the rotiring partner in it if the effect can clearly be for consideration in Steuart and I would ask your Lordships to us to the extent to which it is apart from the partnership boei- be paid by the purchaser for the this agreement and give effect 10 mont., I think the same arose There for the first time and friend Mr. Joakin upon article 13 [ferred to is treated a distinct and expire at the pad of the existing the goodwill and porperty other ascertained. That brings me, Gladstone to Chancery Division carefully year. One of the clauses also than goodwill" shall be ascer my Lords, to the issues and 28. I think the worde here are in the documents the words pro- that provides for the Agencies nined, and, so on.
mark this occur still ia force. I and the General Manugerahip again clearly shows that he in-parties agreee are the pointe aris. the last caso it was property and have the partners themselves by common ground hitherto and effects 13 and 14.
There he the points which I think both property estate and effects. In perty and effects., My Lords, how ground. I submit it has been
may say nees property. Now my Lords. that ia common- we get to the clauso -- of the Company terminating tended the property ahead nolude ing, and at the end of six months. If goodwill. He exoludos it and in under two heads. The first is hey-practically the same. The Master phrase? That is to say, what in a civil action it in common twice only and I have given you
our argument falls effects and in this I think it is their conduct interpreted that think rightly so, and the fact that
The President: Properly and article 13 exist you get over any clades it in clause 13 purely boing rogard to the difficulty arising out of these cause it was necessary to do it in the agree
terms of of the Rolls Jessel delivers his account have they prepared showground should suffice. But if your instances-10, 12 and 15, and I. Mr. Sharp-No, they included Agencies,
ment the Court judgment thus (case quoted)... order to have it valued. Now, cannot make this order. Under Mr. Jenkin any it is not my Lords, Hving made it cloar in the terms of this
ing how they would have regar Lordshipa dosire me to argue it have already submitted the mean- The President:-What volume? ded applicable under the authority of that part a
what in to be included further I am prepared to do so.ing is manifest in 10 and 12, and agree other parts of the ment the Court cannot make this Gladstone To Chancery Division, is the date of this document, down mon ground, you say, that the of 15. Now clause 15 providea these cases. I have quoted. Article deed that be intends property order for two reasons, because the page 626.
Mr. Sharp-Steuart and in the account? From 1898, that The Chief Justice :-It is com now we have to consider the case 13 cannot apply because there shall include goodwill, he again agreement read as a whole showe is no terminus from the period refers to the word property in that clauso 15 does not include the letter going in, Mr. Alabaster?
to June 1911, when the 1910 articles are still in force? That for the determination of the Mr. Sharp-Do you object to balance-sheet was of giving notice, and there-clause 15, the last clause, where goodwill
prepared the partnership has become a partnership if no other arrange fore, my Lords, the position is he makes use of the same word provision of a sale as a going quoted, I understood. Well, there is. From 1896, that is sixteen position.
and because
Mr. Alabaster:Is this it? the It was read and the phrase was. this that this partnership at will and where it is not limited as in concorn would not apply with that is the point, my Lords, and years,
Mr. Sharp Yes, certainly it
partnership at will?
ment.bas been come to batweon Mr. Sharp:Yes. It was their the parties. It provides what now exists, and, so far as the the earlier part, clause 13. I clause. That is the first of my it is perfectly clear, as Mr. present circumstances are
cou submit that the word property in two beads for these two reasons. Wilkinson says in his letter.
The Chief Justice-They are ation of the partnership if no should happen on the determin- cerned (that is retirement, not clause 15 must be taken to include But the second head is that hav-written in September 1013, that respondence arising from the
Mr. Alabaster:-Where is it? quite entitled to raise it if they other arrangement is come to bet death or bankruptcy), it is applic-good will. Having excluded in ing regard to the principle laid it was put in lately for the affidavit.
Mr. Sharp... It is in the cor like. able, by the last clause and by fanse 13 goodwill from property down by the authorities the Court purposes of account only and you was never treated by the partners respondence certainly treated it partnership is determined and no Mr. Sharp should think]tion of o'ause 15, to agree what
ween the parties. This is the func the judgment; only it cannot per because it was necessary to do so would not under the circumstance must not place any sort of reliance as including goodwill, but in the throughout as common ground, other arrangement come to be- For sixteen years it that open to doubt. The car is to occur in that event; if the mit of a sale of this right of for purposen of valuation, if he make this order if it could. That on it. It is manifeet that for this year 1911-that is to say for the refer your Ludships to passsges tween the partners,
Now, my Lords, we are cat con-in clause 15 he would have equal by the authorities the court would did not treat these words "
had intended to do as suggested following the principles laid down period the partners themselves 1911 balance-sheet, when finan- in the agreement of 1900 which cerned with article 13, but whenly specifically referred to it and got in this case make the order if perty and effects in their acthey are now-r, Tomes for the ment of 1890 was to remain in it is clear from the rest of the inclu le lit.
pro- cial troubles were more acute than clearly provido that the old agree-miuation menn determination- The President: Does deter- deed that it was of the first)
it could.... Mr. Sharp's Address importance to the partners that
The President: That is alter they did not treat the agreemont and Mr. Shewan in London) in-no definite period for the then re- I anticipate your Lordship's ques counts for these sixteen years first time (he being in Hongkong force for the present. It provides what it is you are going to ask and Mr. Sharp: I have no doubt Mr, Sharp; As your Lordship's native? apon a dissolution or upon a pleases, before dealing soriatim sale there would be a passing of with the many points which I succeed as we hope to on the first appeared without it, and then it not make a balance-sheet with- nership at will, as it is under going to ask me if determination Mr. Sharp Yes, of course if we teen years the balance-eboots sheat, because, as he said, he could taken by the partners as a part-come to, but I think you were' ae covering goodwill. For six serted goodwill in the balance-newed partnership and was always tion-if no other arrangement is this goodwill at a price it think as both parties put it has point then the second point be- was put in only apologetically. must be obvious that it was the conceived the caso raised here comes intention of parture that wider for your Lordship's decision: Ition. It is cortainly. alternative. so according to the usual practice balance sheet without it: There partnership for ten years before, my Lord, if no other arrange-
annecessary consider-
out. The deficit would have been general law. The only variation included determination of cases this clause 15, which would be direct your Lordships attention to Of course your Lordship has de- I think.
The President:And properly so great that he could not make a in the terms is that it has been a previously dealt with. Certainly,. only applicable under a partner-one clause. In fact as there are cided in our favour on the first ship will, that it should cover few things I shall havea to direct point, and we submit correctly for The next clause, my Lords, is of years after the date of the agree-in forco,
fore in 1913, when the present but it has no fixed term now.ment is come to between the Mr. Sharp-Yes, absolutely. troubles were most acute-sixteen Otherwise the old conditions are parties. Then clause 15 steps in. what we are now asking it should your attention that have not been the reasons your Lordship gave course clause 11, which the Chief nont, and only a little while ago—: cover-the right of succession to referred to, but these General Managerships.
I will and for other reasons which per- Justice dealt with in his judg- for the first time
The Pusine Judge:-Thore is the third time to the cases, two Well then, my Lords, we come for. The President Can we say think this was not refered to, Toent Now my Lords, going into the solution in the event of death or gatically There would have been in this agreement to modify that, instrument. Property and effects
deal with may of them, but Imps we inay find in the document. That deals with a dis- was put in, and even then apolo-
goodwill no doubt of that. that because by the subsequent establish the preliminary point fit point we say clause 15 de bankruptov. It is perfectly clear, such a deficit if this goodwill had and, as I say, since 1806, the date are to be realised and the proceeds of which I have dealt with in Mr. Sharp-Thore is nothing which this phrase occurs in this act of one of tho partnere, or both which 1 gather from your observot include goodwill. Now of as the Chief Justice pointed out not been dragged in that Mr. of this agreement, the partners applied under a certain order of the partners by consent, the ations already in your minds to 80 partnership becomes a partner establish fimly the preliminary never questioned the property and manifestly not intended to be in- Shewan, in the particular words nership as
we don't deny, we have in his judgment, that goodwill is Tomes said, in writing to Mr. have themselves treated the part which I need not trouble your ship at will that therefore the point whether the partners have effects phrase to be really inter-cluded in the words" partnership quoted before the Chief Justice old terme at will.. Mr. Slade said paying liabilities and the paying construction of the deed is to be agreed upon any course, put on preted, the one the Chief Justice business and property." They are in Chambers, that he could not on page 27 of the Judge's notes of cash, capital standing to the
one under altered beginse some of its pro-authority. It is not opened to has interpreted and the one that treated as two distinct things. In m ke up a balance-sheet without that the partnership had expired partners credit in the books" and the Lordships with at the moment visions do not apply to the new this. Court to consider at all, or calls to be interpreted. We have clause 12 the words "property it. circumstances? Must not ve go to consider "whather it is thie navor questioned we don't ques- and effects" back and see, what it it means course or whether some a whole, and as it stood originally? course may possibly be in the effects may include goodwill in would like to call attention to the date of it, Mr. Wilkinsor'e letter of and it is not questioned, and determination meada determina-
other tion of course that property and time in this instrament, and I pccur for the second
by the ellluxion of time and had to M. Alh baster:-The date?
divide, the become a partnership at will think it is perfectly clear as re- surplus. I Mr. Jenkia: Undoubtedly, opinion of the Court the more nd-another case, under other circuntert algo. This clause shows the 23rd, which is now on the on
Mr. Sharp I don't know the That was Mr. Slade's position gards your question that this but your Lordships must bear 11 vantageous. If the partners have cumstance. But we do say under the prices which were to be paid for file, certainly refers to it as the mind in construing it that the agreed to the course to be follow-this agreement it does not. It is the partnership property not being being "put in lately." It was put which he saye in any case revives. II, determination due to voluntary the notes "he refers to tion from any cause at all, from draftsman or the partners must ed the function of the Court is to to meet something which I think goodwill, and goodwill under in in June 1911 for the purposes the old partnership articles, but retirement under clause 13, deter agreement of 1906 death or bankruptcy under clause have had in view the prosent consider that agreement and give fell from Mr. Jenkin. I would any clause 11 ia treated again as to- of accounts only. And it was they" there is no question as to this." mination duo to absence of one
effect to it.
in pussing here, I am not saying tally distinct. Now it is clear that who brought it in in that way; not That, I am sure, was common of the partnera under clause 14. the learned Chief Justice's con- what you have to say later on if ciples of construction is the same lar words Mr. Tomes' lettor to Mr. Mr. Potter on page 5 refers to it cifically dealt with in those pre-
The President. That is what the agreement is ambiguous, but not only upon general princi- we. I understand that the particu-ground. tention is.
you consider it ambiguous, cer- effect to be given the words Showin' wore quoted and referred and says clause 13 applies except ceding olauses, the continuing If in any of these cases spe- Lord. I am not saying anything put it to your Lordships as clear a case between the partners them-my Lords; not ours.
Mr. Sharp: Abolutely, my tain courses remain open. We The President: That is merely to by both sides. It is their point, as to notice-it is a partnership partner on his electing to exercise conceive to be in any way in con-as my friend put it as clear in flict with what the contention was, his construction. We say it is
We were at will subject to the terms of the his option to buy at a etipulated The President: We assume but if he will allow me to say so, clear that property and effects in that point in a minute, my Lord. they said it was only put in for being so, no argument was used to where
Mr. Sharp. I will deal with its being in the balance sheet and clearly common ground, and, that figure agreed upon, in which case. fuking certain arguments upon partnership, agreement. That is figure, or of course, some other Mr. Jenkin-You would have to bear in mind that at the end of point he referred to repeatedly goodwill,
support his fading, and the this particular instrument include The Chief Justice: That was purely artificial purposes. the term only certain articles in the case cited I will apply to proper
It is perhaps the a taking-over cane,
show that it was rightly common figure you
you find a stipulated would apply, and they would have one
founilation for
Mr. Alabaster: I have not seer ground. It clearly is the position quite agree under the other-if may find they not cited Memann and argument.
my Mr. Sharp :-Yes, I shall show the letter. in mind the state of the law then Memann, 43 Chancery Division on this point to
We have I submit your LordeLips in a moment that applying to their fire. If thoy page 198. This a Court of Appeal Lordship's attention to the fact in aver and winding up does not ship in Chambers.
in law and, I submit, the posi- in any of these otses the contin- draw
Mr. Sharp-I understand the tion which the partners them-ning partner does not elect to buy your such a distinction between taking very phrase was read to your Lord-selves regarded under date of the his option at a stipulated figure continued, but there is no agree-so, a very strong Court of Ap-many pitnership cases, or in exist. But I am not at the mo ment to continue.
peal 1890 (Case Quoted) It is an-Home cases, these particular words ment addressing myself to that bundles and bundles of corres-else into the partnership, but that
1908 agreement. It was however or some substituted figure by The Chief Justice-The usual other in which other arrange property and effects and other point. This was a taking-over pondence.
Mr. Alabaster-They put in contemplated to take in somebody special arrangement, this clause thing is to endorse the articles of meat except paying cash. Ef your similar words have been held not case, Tuen in Gray and Smith,
ia. steps partnership, in some such way as Lordships caro tu bave thie-it to include goodwill. The case in 43 Chancery Division, page 209, was really quoted by Mr. Slade agreement
That I submit, was not done. The last agreemy Lord, is the meaning of the These articles are in force is marked. The bead note I refer which this particular phrase pro-we have the same position with himself to support Mr. Wilkin-time.
Mr. Sharp-I understand it ment in fact continues the old provision. If no other arrange another three years." That is your Lordships to are the head perty and effects arises for con- regaid to the word "
except as toment is come to it is specially the usual thing..
note of the posesgen of the jadgetruction is Chapman and Ray-that it might include but did
the Mr. Jenkin There is another ment I referred your Lordships mann, which Mr. Alsbarter refer not in that particular case.
property son's letter.
ground provided for to take it at a fixed small point I would like to bring to page 202, Justica Cotton, nearer to. One Times Law Reports 397. The Chief Justice-Both of member it.
The Chief Justice:-It may in a new partner, but in fact be it at some other agreed figure, if that it was intended to take figure, equally the option to tako forward, and it is tus:Taking the bottom of the page-the last Whether of course it was clearly those osses are in the judgment." property and effects" in clease
have been so, but I cannot re- was not taken in, and it became a not, then clause 15 oblains. Or artiole 13, which I take it merely ton lines (Last en road). I recognised by the Courts that the
partnership at will. Covera etirement and not death shall have cussion my Lords phrase included goodwill, hut it in which the point arises, and in bat your Lordships must construe your Lordships that the construct actually resigning,
if the dissoletion and the deter Mr. Sharp-There are all cages 12 as it clearly bore in clauso 10 the argument I was putting before should be in the case of one
Now my Lords coming back to mination of the or bankruptcy, I am going to several times in the course of the was held under the cumstances them all the Court held that it the phrase clearly as the correction
partnership submit to your Lordships that argument to point out what your of that agreement that it did not. did not include goodwill. Now, one in clause 12, because the ac- clause, deals with voluntary re-kruptcy and the cases dealt with
constant ues throughout Lordships are asked to do here It is a very short report. I don't
of this instrument, this by notice, not death or ban- a dissolution the dead of the word "property" which is according to my sub-think it was read at all. The draftsman of the agreement be ascertaining the value. as such wherever it appears, is mission to make a new contract head note is in small type the fore as in the present case did manifest that the same phrase the share in the partnership busi-and due notice given. In cases my Lords, we see that the count is taken for the purposes of tirement and the continning part in the paragraphe, dissolution of intended that it should include not the one between the parties bend note
It is ner in this clause may purchase this partnership company at will, goodwill. Now, my Lords, in (Provions case again quoted). effacte". The phrase to ho inter-and effects should include throughout the same document, with again separately, cloane preceeding paragraphs and no inProperty and not intend that the words property must be given the same meaniog ness, property and goodwill dealt not specifically dealt with in the article 13 it provides that in Buch That refers particularly to the preted a case the other partner shall be facts of the case, particularly The same phrase is raised in this Lordships to look a little further accounts were to ascertain the tinotion and in the same language
ideatical. goodrill, and I would ask your and it has been shown that the 13. Again we have the same dis- amicable arrangement come to→ at liberty to purchase the share the passage at the bottom of the instrument (case quoted. Then back in the Chief Justice's notes. value of the property other than between A, ordinary business mon ground so far. of the retiring partner in the page. The question the Court (Justice Jelf quoted) I refer to the I think the Chief Justice wont goodwill, Therefore property and property, B, goodwill, and we have Mr Sharp-No, my friend Mr The Chief JusticeIt is com partnership business and pro- had to considor is merely the con- argument based on Hall and Hall far enough back to establish the effects cannot comprias goodwill. the same prices to be paid for re-Alabaster accepted no anggestion perty "and in the goodwill." struction of the course. Your Lordships referred to that Justice Bowen sagathe some thing, be law ten years before this case established more firmly if we go referring now to 12 or 137
Lord which my friend says ceased to position, but I think it will be earlier in the course of this hear and also Lord Justice Fry (both by Justice Day which is 1884, backa little further to clause 10,
The Chief Justice Are you spectively A, partnership business this morning. His contention ing, to the use of the words quoted). The position is made my friend read one 1874,
Mr Sharp-I am on 12. now. arrangement in respect to dis- and that the one before that was "and goodwill." But your Lord-perfectly clear there. Where there
property and B, goodwill, is en was" wholly and soparately from" shipa attention was not drawn to is an agreement to be construit ceased to he law. (Justices Jell the agreement. Olause 10 is the and it is not really necessary for we have the same distinction distinct from the preceding Mr. Alabaster: Thave not said effects" occur for the first time in taken alone is quite conclusive, the preceding clause 12. There and numerically. He held it where the words "property and I submit that this one argument solution by death provided for in something distinct in sequence the succeeding word" thereof." It reads "and in the goodwill into the question of whether the depends on the facts of the which the Chief Justice consider clear that there are only three the next succeeding clause 14 we Mr. Alabaster: I have been
ed we had to consider it and go and Day quoted) Of course it claum before the first clause me to go any further. It is quite emphasised, A and B. And in clause thereof." That, of course, makes partners have make the beat arr case. I am not offering your od and the clause it clear that in that passage the angerents it is possible form them. Lordships that case as an author- for a yearly account to be taken and in the first two it is mani- in the same words. Clause 14 understood, to have said that. draftsmen has in mind and in to make. I might briefly point ity in the present case, because it of the property and effects, the fest that it would not have been deals with the case of dissollution My friend has rather put it that provides cases in which the phrase occurs, have the same distinction repeated misunderstood if I have been tends that the word " property out-later on poin out-that the was found there that the phrase credits and of course the liabili- intended by the draftsman to as resigned, or ecossioned by I don't adopt that. I don't know shall include goodwill, be-
arrangement the entered into was did not contemplate goodwill. ties-the property and effects" include goodwill. I could really the absence of s partner and in how he is going to work it out. cause "thereof is only re
a successful arrangement in the It must always be an. Where of the partnership. This is of submit, my Lords, that it is not that event again the remaining It is right, they come in and the past, but that is not the ques- this phrase has arisen for the coare the annual balance-sheet necessary for me and the property. Not my tion. The question it was construction of tho Court, which is raferzed to.
to argue any partner may purchase the absent That more. It strikes me ag conclusive partner's shure, 4. pagimeship
vircumstances,
The President: -Why? Mr. Jenkin :-Onthe basis that they must have had in view the fatare. There is a provision in the partnership deed for the part nership becoming partnership at will.
the
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