which protects every one as much
as it can.
¿
THE HONGKONG TELEGRAPH, SATURDAY, FEBRUARY 21. 1J14.
is the continuing partner, and as a faot in this case the same princple is still in existence. In asmuch as the suggestion made
to
at
the
Boaldes, if they had intended to
The
partner would be entitled to come
course that would be the mode of Mr. Alabaster: May it please then i really comes to this that that they are forced to suggest under this clauss and purchaus the
sale, because if your Lordship your Lordships. The first point I where therefore property and effects the money or your life intention forms, the consising partner to take bakinesi for whatever he could get
fer to the notas taken by the learned have your permission to deal with must be held under ordinary deed at once shows the weakness of it, that would be iniquitons. If the
Chief Justice in Chambers you will is the point raised by Mr. Sharp of agreement largely to cover good their argument. I suggest that at the valuation or some other valu by the other side is thore should continuing partner is able to do be a sale as between the two find that I dealt with this very yesterday as to the meaning of pro- will, in the ease of this particular the contention which I have put atina, they would have drafted this this, be could say, "If you don't pay partnere, that suggestion is found point, and it was also dealt with by party. He confessed that property document where in view of the way that the objects of olauses 11 to would have said expressly so, and forward is unassailable, that is earlier clause differently. They & fair price, the whole of the assets in the letter referred to by my my learned leader that the sale as might include goodwill, but sald in which the partners used will have to be realized." It cannot learned leader yesterday 8th. a going concern would work tremen there were certain cases which treated it in the balance sheet of he did not have under the be sold with the goodwill in language and 14 were to give him rights which they could even have said it is 5d be suggested that the executors August. We suggested confining dous injustice to Mr. Shewan on stated that in this case it did not. 1913-I don't know whether it ap general law, and that is what could go into the market and carry because it is obvious that either of
the bidding to the two partners the assumption that at that moment Every single case he cited was on the business simply because the them could afford to pay more all the cash be could command for case which had already been citedly does not include
a pears a second time-it undoubted these rights are rights, liabili- as plain as was used or plainer than
ties in business-the deceased partner has left an infant than any outsider for the good the purpose of buying the property by me and distinguished on
rights that used in the case cited. are stated in 65% of Lindley.
The President: Under Clause 151 son and they say out of charity will of the busi ess. Now my was a certain amount. I argued on ground that it was
Mr. Alabaster: I will come to The President: 65%? 4 taking-ovor that.
Mr. Alabaster: Yes, they could "we will carry it on." In thai poa / Lords as I submitted before the the same lines and I think if you case-every single ono. In a taking-
Mr. Alabaster I think it je have provided for this being sold case, you have as perfect a remedy the other side has never done so, Justice'n noten you will not find that takes over everything. Whether it in this article; it ought to have (Again read).
adj urnment, fail to see why will look
the learned Chief over case the taking-over partner prosent view it is not covered by bear with me if I read it again. Forms which says it shall not be no
The President:
the only passage on the right with the goodwill I think I ra But under my before you. Your Lordships will forred to the case in Encyclopedia as you can get unless you put in the what possible advantage this doed the words that the continuing clause can be, putting outsiders the other side which contradicts takes it ovor.
a word was sald by the counsel for goodwill is mentioned or not be this ordinary meaning, or if it is partner must "take over, and that out of the matter for the
The Chief Justice: I cited that Barchall and Wilde also a case In our construction is a construction moment-this particular clause that in any shape or form. That is
artanged infers a different meaning. in my judgment. If he has to pay for it especially
which they agreed clearly that the any time to go can be if a partner is entitled at assuming the position which wo put apart from the price he pays, it they have put forward on which you set it out. Your Lordship
Mr. Alabaster That is the view!
Mr. Alabaster:-I don't think goodwill was not to be sold. outside this ma to Mr. Showan which you are has to be mentioned that has have not yet addressed myself. olause and purchase under clause bound to assumo
The Chief Justice: In the same might,refer to the passage; it is way as the words "other than good 15. So now I am dealing with correspondence namely, that he has case which has been referred to if you read the been shown quite clearly in the
giving him that right (Passage re- This Court then adjourned for the case of the ordinary partner.done his utmost with the money at by my learned friend, Mr. Jenkin,
The President: Quite right.ferred to). It goes on then will used in clause 197 tiffin.
I cannot s00
Mr. Alabeator: the advantage.
They have not "Even the.goodwill of the busi-
Mr, "Alabaster': Quite so. Mr. Potter At the adjourn. I cannot see it is avon an his disposal.
Chirion and Douglass, and that replied to me on that. I shall now ness if sulsable must be sold." The draftsman doas not conceal pistols ment I WAS shortly that specifically under the partner except in these particular as to the words, it seems to me Law Journal, Chancery, page that I will carry on with this efforts that this firm has been
submitting that | advantage tho continuing The President: As it is a question I
has to be road with another case endeavour to destroy any impression object of elevon and fourteen in his draft if he follows the lines
have referred to. It is 28 that argument might raise. To doj
is to give him rights, to recognise of such an excellent precedent as derd of partnership the continuing circumstances except by change that as the Chief Justice is a mem-841, and it was a case in which clause four Prideaux paragraph two, built up, and give him some right the fact that it is partly by his partner must purchase at a fixed the goodwill is theirproporty and a
Prideaux. Now, they have based price and they may ask your sum fixed by the partners $500,000 her of the Court he might say what goodwill was bought. (Саве
BAT argument on the use of the Lordships that under conceivable or $300,000 in all, agreed by he did find.
quoted). Read that with the (Quoted). Clause six comes from to compensation; to give him aame words occuring again in diffor circumstances our construction the partners at the time when the
The Chief Justice: As a matter of Court Hill and Fearis, which Now I am getting on to your minute that outsiders would I do not know whether they use IE
most recent cuso cited in this as it is means to provide the partner wants to buy his goodwill fact 1 intended, these words to in- says that on a dissolution, good lordship at once, because I am not bid for the goodwill of this in that way, but that is the true clause nine, page, 618 (quoted), right over and above the outsider. ent parts of the Instrument; they Of course wo don't consider for a have prima facie the same meaning partner, the retiring partner in a sufficient sum. Thon I can who represents the deceased see it is an advantage to the con-ply that were I of opinion that I will-if salgable-must be sold. partner or the bankrupt partner tinuing partner, This clauso had power, to do so under the if there is, no provision in the Prideaux.
The President: You mean that taken from clause twelve, 648 of the partners, but of course they true draftsmanship, where the same
at clause ten. Ton is I submit. business-not 60 much as to get the proper price for "his in- would be a very unfair advantage urticles I should have ordered
law. I agree that as a matter of terest in the partnership business, to the continuing partner as put uale intended that, I am not
partnership.
would bid for the contracts of the My Lords, assuming what I think the dead by my friend, and it is talking about the arguments. So taking-over case, the very fast
Mr. Alabaster: Yes, but in ait ?
The President: Will you read general managerships worth so
words occur in different places, int must be assumed that the price antagonistic to partnership law. fixed for the goodwill is a fair The court has to assume that far as the arguments wore before that he takes over a valuation Your lordships will see propertygning concern and would have the in each particular case; and, there
Mr. Alabaster: Yes. (Read). taking the goodwill, buy as a facie have the
much. Therefore the persons the same instrument, they prima price inasmuch as
the parttors fevery clauso put in the partner-ze in Chambers, 'if' I had been of whole thing as a going concern, have dealt with the whole of the those companies. Any company fore, it is to avoid that prima facie
means that he is taking over the and effects. At any rate I think I
same meaning) have not altered it and who have ship deed is put in for the benefit opinion that the articles justified So, if you want a special price partnership which your Lordship would be very glad to bid for it. meaning that where the draftsman come to this price no doubt of all parties, not only for one, and it, I should have ordered a sale na for goodwill you have to mention laid stress on.
proper qualifications to hold over after consideration, and in it is clearly laid down in Lindley. this case they como to the price 442. seventh
going concern. I was not of the it, that was laid down in the Hall drawn your attention to the facts, would be of no value to them. sense in a particular caso, but he editon (Quoted).
I have already We have never contested that it wishes he uses word in a limited after three alterations, assuming Now my Lords the authority opinion; and Mr. Alabaster, in open-
and Hull. In the taking-over and that they mention goodwill They then on page fifty of the attaches to it words of Emitation, think must be assumed, the learn-known and is the loading case started by saying that the reason is to be paid for it, it is to be don't mention goodwill at all in they
taking over, and if an extra fee clauses, that is clause 15, and they purchase ed President has used the words quoted in Lindley-Blissot and I did not give effect to the applica mentioned. That is the form of the final account clauso, I have $300,000 represents the
by outsiders when himself-assuming my Lord the Daniel. Io Hare, 493. Haventh'
a genoral meaning, he omits the say that the figure of between the parries, the construc-am at ʼn loss why the draughts-finding so under the articles. That whole of the argument is common and I submit that is the draughts- the value would no doubt be to be placed on the words. Now, words of limitation, thus, drawing ‘a to of the businese, to value described as conveyancing argu-
outsiders distinction between the two meanings law. argument, and mine can be man's- ments. They tried to place their argument on an ancient edition of count, the determination of part common groun there was no value the term "property's includes the
The President: What clause.
less. I do not want to take it I have already established the prin Mr. Alabaster: Thefinal ac- do themselves,
any differently from what they ciple that a draftsman knows that
I protest on Key and Elphinstone. The argu- nership (quoted). It does not men-boyond to the partner and they had goodwill. In this particular case, I am which is unsupportable that the mentioned in 16, the aide note to business. It is of extreme value to every time that the word property really partnership could change the law which is " partnership determina- the outsider, but in this particular is used in a limited sense to add a suggestion tion goodwill there. Goodwill is to withdraw the common ground therefore, he has been very careful tion on this deeds you are asked at the price which he ought to /ought on the interpretation of that on this point. Of course, it could tion by death or 'voluntary with-it is if more value to these people. words of limitation, and every time to do by counsel for the plaintiff, take it over. The given price point to submit that your Lordships of Key & Elphinstone is 1879, the only use this clauso bas would means scrip price given for the assent to the view put forward by which is a very important date, lomatic reference in David and to outsiders which he has not..
The date of this edition drawal," (Quoted). not apply, would be in every assets. I base the fair price of my learned leader--that as Mr. and they mention goodwill in Matthews under the old law-the It is not a question of clause The President: There is a dip-give him a greater right than
The object of this clause is to it is used in a goneral sense to omit way for the benefit of the con- the value on that ascertained in Shewan is not able to come up to every single clause, in the Annual ordinary tinuing partner only and I the same way, or if the circun- that first necessary bid, then your Accounts Clause, the Dissolution or continuing partner to buy the or anything else. It is con- goodwill".
those words. surviving
And the words, of limitation are. doubt even for his benefit. Ho stances justify, the partners aro said he could get it cheaper entitled to agree that some other Lordships must agree that the order. Clause, the Taking-Over Clanse goodwill as a matter of course,ferring a favour upon him-it, is
partner 14, nor a
ques ion of pistols first of all, the words "other than under clause 15 by not ex- sum should be substituted. Thening of a sale as a going, concern an
and in fact every clause. I, rely therefore if he was to pay for not bound to du it; it was not an ereising my option. At the I can 500 that this
The President-And In the it he would presumably have attempt to put any hardship on clause these conditions would be depriving very much on that case. highest that cannot be for the would have the greatest effect. Ir. Shewan of what my learned 1878 the ease
you say in clause 10, he does not wish benefit of any partner except the think as a matter of fact my leader has described as his vosted
was decided it mentioned. which I have already given your
Alabaster continuing parinor and any con- Lords, if you will only read the
him. it is giving him the option- limit it1 I struction such as that is antago correspondence in this case, I am interest in the partnership. Not Lordships, namely Reynolds and under the old law it was pre- that or not, I have invented that not say if the goodwill is to bo
far as I can remambor care whether you have heard of fancy, that is the option clause. I don't
Mr. Alabaster: Yes, certainly. nistia to the law for the partners, not going to road it, you will see only that, but it is an order no bullock, and that was the leading sumed he was entitled to have myself (laughter) because it fits valued.
The Puisne Judge: But you do The President May it not be the vory operation of this very nurt of equity would make. And which decided the words pro-it. The old law cases showed the clause. Call it auction clause this way. I know in this particular deed in this way.. cuse the only possible buyers are Therefore, my Lords, I submit that the further argument put to your
of course, my Lords, I fully realise That finally settled the cusa (Hoad the value included goodwill. He (laughter)--I will give you the will allow me to work out my own.
perty and effects included goodwill. if he bought the other out partners and you cannot have this Court aught and will put upon Lordships on that point-an argu.
or option olause if your like. a lapse in a partnership deed the deed the construction which will ment that must weigh with your
notë, quoted).
was not entitled to sell the good-genesis of auction too. Why was turned. There nruy be
will, and there is the best possible it inserted? Any special object? because I realise that your Lord." After that case, therefore, it be authority for the fact that the It was inserted because of clauses ships have a difficulty. The words arrangement by which we got make these clauses have that effect Lordships in coming to a conclusion came unnecessary, oven if it were Another case on the moaning of only inserted to give him a pre-
argument, I will arrive at it later, partner cannot steal the goodwill.elevon to fourteen which were someone to buy at the price!
rather than a construction which Mr. Petter-That may be con- would reduce them to a nullity be Lordships would or could in fairness to use that old Key and Elphinstone (quote re Thou shalt not steal), owing to the circumstances of the goodwill". He expressly uses those
on this point-as to whether your necessary before, for any draftsman goodwill is Dunesy and Cooper foronce. If they were unfavourable 14 are, first of all, other
of limitation ho uses in Articles 11 to. ceivable if you had a partnership cause I do, submit mont confidently order a sals as a going concern in clause, and the edition which 'It deals with one partner stealing case, they were unfavourable to words in the Option Clause. He other than the one you have here, that if you do construo article 10 ns view of the position outlined by quoted is 1879. Now in 1879-Rey-the goodwill of another, or put give him, the remaining partner, does not use them in the other because the partners here in en ask you to construe it, you might toring into this dead know well
going to carry on
these good people (laughter), which he has and which is set out woll and beyond all doubt my Lords them. If you take the case of a re-
proposition that the draughtsman highest
that and assuming also what Iin that proposition is very, well-ing the case here in this Court Case goodwill is ingludod in the expressly in tho taking over file contemplate the possible and whore bo intends it to have
tion we put on the deed is the man brought these articles into it ia perfectly correct. I am not say very best way to enable the part- if they are articles intended as they ing whether the further arguments ners to carry out that trust, but the must be admitted, intended for the in this Court have changed my one under special cases. I think mutual benefit of the partners. death and bankruptcy was in his I can understand why he brought views upon that or not. mind or absenco in another coun-them in if they were brought in Mr. Potter: I quito follow. try for more than two years-for the purpose of obliging a much obliged, my Lord. I absent if you put this construc-partner to take over the goodwill
this
mént
not.
rests
on
Mr.
As
Mr. Alabaster: If your Lordships
than
the class of business they were as well wipe out 12, 13 and 14-yony learned leader. Then there was nolds and Bullock-we find Key and ting the pistol at the head of the continuing partner, the right clauses. That would be one of the
They knew it might as well draw your pen through point raised by Mr. Jenkin, my Elphinstone's old form departed I think I have established then Lindley, page 588" Sale-to the
Mr. Potter:
Ead
from.
The Chief Justice: In the edition-goodwill was left out. Mr. Alabaator: It is the
to.
reasons he indicates that it is used 1879 dealt with Prideaux, and dealt is why I call it auction clause, uses the word "property" after- biddor-"(quolod). That in a general sense in clause 10,- He with Prideaux in the ordinary because you sell it to the highest wards with the words "other than way; he did not invent a new form, bidder; if he doesn't use the option goodwill" after it. He uses the and it is not the case, such as the clause, he must sell his right, word "property" in four other yesterday the draughtsman or the clause; you may call it highest
1879
caso,
A
Lord, as to whether clauso 13 was I think it is common ground-tiring partner, a representative of applicable to this caso. My Jenkin I don't want to put my friend's deceased partner, or a bankrupt cited an authority which he said was case too high, I submit it is our partner, you will see my point. In an authority in favour of the pro- case I think it is a statement the two cases of the death or bank. position, and perhaps your Lord. odition of Prideaux I was referring ease my learned friend mentioned that is why I call it auction clauses without those words. Clear you will find in the statement of the learned judge--this goodwill Tuptcy or absence through illness, ships will allow me to give you a would be of little value except to the draughtsman would draw the reference from Lindley which makes the partner.
The President: I do not know testator making a dictionary for bidder clause if you like, and it is ly he intends "property" in these articles to protect people who would the matter clear. Mr. Alabaster; That is not otherwise be defenceless; therefore,
whether it will carry it any further himself. He took Prideaux, the this right we are claiming in this two cases to have a different meaning The President: I don't think that by saying that the next earlier used the meaning in the sense. common ground.
conveyancer's dictionary and he Mr. Potter: Well I can put my spirit and intention of the partner-much at the moment, so far as I
my Lords, I submit that the proper the argument impressed me very edition of Prideaux was otherwise. presumably that Prideaux used.
than in the other three. On their case as high as this. They cannot ship deed will leave no doubt as to can remember. avoid this fact that it is a fact com what is the effect of these clausen
Mr. Alabaster: I have not been it.
Their alternative argument, or argument on the construction of tho Another proposition put pistol argument, leads to an unjust deed your Lordships will have to mon ground They have not sug-
able to get one, but I can carry it forward by my learned friend construction. Let us take the case attach no value whatever to these gested in the course of these and, furthermore, I say with con- case of Nielson and the Moss drafted this spoke with the words clause 15 is this. If the con don't follow the way he works it the construction I am putting for
He quoted the
thus far, that the person who yesterday, I took down in protracted proceedings or corres-fidence that your Lordships" can
these words. The meaning of of my learned friend Mr. Potter. If
words other than goodwill";" on? pondence--they have not suggest search through the cases from begin
Ironworks Company in of Prideaux and not the words of tinuing partner does not elect to out. But take the case of a partner ward, I will try and attach ed the possibility of the outsider ning to end and you will not find order to show that this particular Kay and Elphinstone. The language exercise his option under the buying. They have already drawn value to every single word in this being the purchaser.
The President: My point is this, you must give effect to this deed
a deed of this character and I think clause was not applicable. That is the language of a draftsman earlier clauses, this clause steps attention to the earlier. clauses in document.
case is dealt with on page 472. in considering the agreement you
skilled draftsman in. That is how my learned friend, which $300,000 is the figure agreed do not waste words." "Other permeated with Prideaux and not must consider the intention of the and to the peculiar clauses contained
The President: I ses my note of that with Key and Elphinstone. If your put it; it is only in the work the surviving partner can say to the and he must put it in for a reason- put it, and that is how I should to. Under the construction put, then goodwill be puts in always, partners in entering into the therein.
is that Mr. Jonkin asked us to say Lordships will turn to the partnering out we differ. agreement at the time it was drawn, not what it has been
this clause was inapplicable because ship Indenture, your Lordships will proposition exactly as I put This is the apprehended by cirourastences I want to address your Lordships inapplicable to the present cir-like the language of this old in the earlier clauses, this clause alternative is for the thing to be
There is only one more point which you cannot get the goodwill, as it is see the language is about as much it in my argument below, if he for the share. You can take 8100 further word of limitation, in these "I will give you $100 not content with that, he puts in a Mr. Potter: I think it makes my on and that really arises on a state- ogmstances, and the Chief Justice Prideaux and unlike the language of steps in. It is in the working sold piecemeal, and then "wo shall The President: Where is that?
does not exercise his option as or nothing." Or say 8100,000. The two cases, and that is the word position much stronger. I respect mont made by the learned Chiof held that it does not apply. 1 Key and Elphinstone as it could be out of the object of this clause both lose tremendously and I am Mr. Alabaster, It comes in 11 fully agroo You must talk Justide at the very end of his judg-pointed out that the construction
Clause one at Prideaux page 21, that we differ My friend put it on the spot and I can get some of and 12. (Clause 13 quoted). To agreement, and I think it really strengthens my position in this for the reasons which he trusts he has change of position.
"partnership shall continue-quot in more general language to-day. way, my Lord. Supposing a made clear he regretted that haj
I think the object was the it back and you cannot. The shares adopt, their argument you have partnership comes to an end could not make the order of a mode mission I was going to make. I (quoted) That form does not appear to tako over under the earlier struction. My construction is this that part of it which consists of the Mr. Potter: That was the sub the second olaase of Prideaux is on to the continuing partner suffer the loss." That is their con- The draftsman says you shall sell (Key and Elphinstone quoted). Then clause 15 is to bring pressure and so you must accept $100 or augmented value to the word "and". the order that this agreement sale which would be "most beneficial do not think I need give your Lord-at all in Kay and Elphinstone, And clausos, and I think your Lord-The recutors say "We have goodwill: That absolutely balances has been filled-I, don't think it could be suggested there is no the business as a going concern. My
to the parties"-that was a sale of ships any reference from Lindley, goodwill in existence worth a scrap to anyone, except a con- learned friend Mr. Jonkin suggested need trouble. You can see what our deaux (quoted). Absoluteoly the absence of agreement. No other plate over-riding of that right; there ty and the goodwill-nothing shout
clause three corresponds with clause ship asked him where this app- The President: I do not think you four-it was in clause four in Pri. ears and he said in the clauses, right to have this sold to the highest the words (other than goodwill”, tinuing partner.
that on consideration of the facta Mr. Alabaster: Not common rour Lordship had come to the con- view is.
it is in the opening words in the bidder, but there has been a com Being the business and the proper ground...
Mr. Potter withdraw the
clusion that the best mode of ente Mr. Pottor: There is just one refour au based on clause right.
same language. The samo in clause arrangement, come to, this force, has been conferred on you an option thereof." So we have three separ- words dommon ground. Un-
vas a sale is a going concern. I do ference I would like to refer to a The President: Granted the con- argument, and that is not what you can offer us a Bgure mors ne property and the goodwill, and they call it what you like this pistol of taking it over at a valuation. Its things the business and the doubtedly in this case the cot think the Chief Justice suggested crae of the construction of partner veyancer used Prideaux and he was the draughtsman, and couldf ceptable to only person who would give that. I think that was
I submit is the intention o agegaral ship articles. That is the case of aware of the case of Reynolds and not be submit they have otherwise it must be fold to the "Thereof exactly shows that cent for the goodwill expresion that
in the ordinary Daniel and Blisset. (Case quoted). Bullock-I think they are Prideaux suggested the Intention and irighest bidder",
we will take it; ars all linked togethert by fanda
(Continued on third Extra).
executors
"thereof".
of the time of the signing of the ment. In the last paragraph that could be modified by the subsequent od"). And so on, it is just the same same. I think the object 'of) will depreciate and everything else, to strike out no value and give un
got