Smith v Mules; 17 Feb 1852

References: [1852] EngR 271, (1851-1852) 9 Hare 556, (1852) 68 ER 633
Links: Commonlii
A and B and the son of B entered into partnership as solicitors, and by articles agreed that the partners were diligently and faithfully to employ themselves in carrying on and managing all the professional business in which they or either of them might be employed or concerned; that B should use his best endeavours to obtain the appointment of the partnership firm to three offices or clerkships, which were then held by B, and such offices should be partnership appointments; that all other compatible offices should be obtained, if possible, in the name of the firm, and the emoluments treated as part of the profits of the partnership; that, if B or his son should retire, or A or B or his son should die, the share of the deceased partner should accrue to the surviving partners : that if B or his son retired they were to use their best endeavours to secure the practice to the continuing partners, and such retiring partner shouId not practise within 30 miles ; that, if either partner should not diligently and faithfully employ himself in carrying on the said partnership practice, and should, on receiving monies, bills, notes, &c., knowingly or wilfully omit immediately to make entries thereof, or if A. or the son of B should absent himself more than two months in one year, the others or other of the partners, if they or he should think fit, should be at liberty to dissolve the partnership, by giving to the offending partner a notice to that effect, and the partnership should from that time, or the time specified in the notice, be dissolved in the same manner and with the same consequences as if it had determined by the voluntary retirement of the offending partner. B. and his son subsequently prooured their own appointment, or the appointment of one of them, to the offices or clerkships, and did not endeavour to procure the appointment of A. It was afterwards discovered that B. was greatly involved in debt, and he absconded in January 1849, and did not return to the business, In May 1849 A, served a notice, in the manner pointed out by the articles, on B. and his son to dissolve the partnership from that date ; and he then filed his bill against B. and his son to have the dissolution declared by the Court, an injunction to restrain them from practising within 30 miles, and a decree that they should resign the several offices or clerkships. Held, that the Plaintiff was entitled to dissolve the partnership as to B., but not as against the other partner (the son of B.), and that he was not entitled to dissolve it by notice under the 16th clause without the concurrence of his co-partner (the son).
That B., not having procured or endeavoured to procure for the partnership firm the appointments to the several offices or clerkships, so as to give the Plaintiff at the dissolution either a share of the profits of the offices or the chance of competing for them, but such appointments having been procured for B. and his son to the exclusion of the Plaintiff, B. and his son were not to be allowed to retain the offices for their exclusive benefit.
That,inasmuch as, from the nature of the offices, they could not be sold, nor could any manager or receiver be appointed to carry them on, the Defendants ought to be charged with the value of the offices in the partnership accounts.
That, the Plaintiff having given a notice of dissolution (acting under the 16th clause), and his co-partner having adopted it, the partnership should be treated as dissolved from the time of the notice, although not with the consequences attaching to a dissolution under the 15th clause.
That, the consequences of a dissolution uncler the 15th clause not having attached, the Plaintiff, therefore, was not entitled to the injunction to restrain the Defendants from practising within 30 miles.
An agreement that, if any of several partners should not diligently and faithfully employ himself in carrying on the partnership practice, the others might give notice of dissolution, construed to refer to the diligent and faithful discharge by each partner of the portion of business carried on by him.
This case is cited by:

  • Cited – Faulks -v- Faulks ChD ([1992] 1 EGLR 9)
    One brother, as tenant farmed land under a partnership with his brother. On the death of either partner, an account was to be taken and a valuation. On the death of the tenant, there was a dispute as to whether the value of the farm’s milk quotahad . .