The contract of partnership must be formed for the purpose of sonic lawful trade, business, or adventure. If the subject of the contract be illegal, there can be no partnership founded upon it, so as to give the contractors a remedy against each other, or against third persons, at law or in equity ; and if there be an illegal contract of partnership which is not executed, but executory only, none who are parties to it can by action or suit recover the money advanced for the purpose of establishing the partnership. A contract originally entered into for the purpose of evading the usury laws, and not bond fide with the view of partnership, could not, while those laws existed, be supported as a legal contract ; nor can a partnership between attorneys, where one of them is not duly qualified, be sustained.
A person may etipulate not to be a partner, but if he shares the profit with those with whom he stipulates, he becomes a partner so far as relates to his liability to a third party. And if persons be known to share the profits of a trade, it is presumed that they are partners, and as such liable to all who deal with the firm, whatever be the private agreement among themselves. But they may repel the presumption of partnership by showing that the legal relation of partnership among themselves does not exist. If a person allow his name to be used in a business, or in any other way consent to appear as a partner, he will be so considered with respect to other persons, whatever may be his agreement with the firm ; and he will be equally responsible to third parties with the other partners, although he may not receive or be entitled to receive any of the profits. The ground of this rule of law is clear and reasonable : a person must be considered bound by a con tract, if he act in such a way as to make other contracting parties believe that he is a party to the contract; and such is the case with a man who allows his name to appear as a member of a firm, as to all contracts and dealings which are necessary for carrying on the business of the firm.
A partnership at will is one which continues as long as the parties live and are able and willing to continue it a partnership for a fixed term continues for the term if the parties live and are of legal capacity to continue it. A partnership at will may be dissolved at any time by the express will of any member of it, a rule which is derived from the Roman law, and which is a necessary consequence of the nature of the partnership contract. case the partnership is dissolved imme
diately upon notice given by any of the partners. The effect of such dissolution is to stop all new partnership dealings or contracts; but the partnership still continues for the purpose of completing all con tracts already made, and all dealings or undertakings already com menced. On such dissolution, any partner is entitled to have the whole partnership stock, and the interest in the premises on which the business is carried on, converted into money, and to receive his share of the produce. In all cases, by the natural death of a partner, the partnership is dissolved, a rule also derived from the Roman law, as already stated : it is also dissolved by a partner's civil death, as his outlawry, or attainder for treason or felony ; for an outlaw, being dead in law, incapable of entering into any contract, bringing any suit, or holding any property, a partnership in which lie is engaged is therefore dissolved ; and, strictly speaking, the whole property is forfeited to the crown ; for as the king never becomes joint tenant, or tenant in common with the other partner, the crown takes the whole ; but this right is seldom enforced against creditors or innocent partners. A marriage of a femosiole trader is also a dissolution of a partnership at will. A partnership for a term may be dissolved before its expira tion by the mutual consent of the parties, by the decree of a court of equity, or by the bankruptcy, outlawry, or felony of any of the partners. A court of equity will in some cases dissolve a partner ship on the ground of incurable insanity in one of the partnership. A partner may agree that upon his death the business may be carried on beyond the legal period of dissolution in the hands of his children or other third parties ; but this is properly an agreement for a new partnership. Partners cannot be relieved from future liabilities to third parties without notice to them and to the world in general that the partnership has ceased ; but in the case of a dormant partner, if none of the creditors know that he is a partner, no notice of his retire ment from the firm is necessary ; and if it be known to some, notice to such only will be sufficient. On the death of a partner, notice of the dissolution to third parties is unnecessary.