Judgement

Appeal from a decree of the High Court (January 17, 1910) reversing a decree of Russell J. (April 13, 1909).

The suit was brought by the appellant in the High Court against the three respondents to recover Rs. 111 1,819 for money lent and advanced by the appellant to the first two respondents by means of acceptances by the appellant of hundis, or bills of exchange, drawn upon him by them. The second respondent was an insolvent, and the third was joined as official assignee.

The facts are fully stated in the judgment of their Lordships. Shortly stated they were as follows. The first and second respondents had entered into an agreement dated July 25, 1906, therein described as being for the purpose of doing business in J partnership in brown sugar from Mauritius to Hong Kong. Under this agreement each partner, after consultation, was to j buy sugar in his own name, giving to the other a delivery order ‘for half the quantity. When sufficient sugar

had been purchased it was to be shipped to Hong Kong, separate invoices for half the quantity being made out to the respondents respective Bombay houses, who were to carry through the sales at Hong Kong. Separate accounts of sales were to be kept, but the profit or loss on the entire transaction was to be divided equally. Under the agreement the respondents were each to draw bills for the sugar purchased, which under certain circumstances were to be accepted by the appellant.

Under this agreement the first respondent bought 36,000 bags and the second respondent 4000 bags of sugar, and in each case bills in respect of the price were drawn by the individual purchaser upon and accepted by the appellant, to whom the sugar was consigned. When the bills became due the first respondent retired those which he had drawn, but the second respondent, having become insolvent, failed to meet those drawn by him, and they were discharged by the appellant as acceptor. There was a loss upon the whole transaction, and in the result the balance sued for was due to the appellant. The first respondent denied his liability on the grounds that he had met all the bills drawn by him and that he was not liable for any moneys raised upon bills to which he was not a party. The second and third respondents did not defend the suit.

The suit was tried by Russell J., who held that there was a partnership between the first and second respondents and that the money advanced by the plaintiff had been advanced for the partnership. He gave judgment for the plaintiff.

The High Court (Scott C.J. and Batchelor J.) reversed this decision. The learned judges were of opinion that the purpose and effect of the agreement were to keep the interest of the respondents separate and distinct until the close of the transaction, except in so far as a combination was desirable for securing joint shipments and sales, In concluding their judgment they said "Treating the question as purely a question of liability between the parties to the bills of exchange it is manifest that the plaintiff cannot succeed in charging the first defendant with liability on bills of the second defendant, and, having regard to what appears to us to be the correct construction of the agree ment between the parties, we cannot hold that there is any collateral agreement by which the shipper agreed to be liable for the default of the other in not taking up bills of exchange drawn by him on the plaintiff."

De Gruyther, K.C., and OHagan, for the appellant. Under the agreement the first and second respondents were joint adven turers and partners for that purpose Indian Contract Act, 1872, ss. 239, 249, 252. The law of partnership in India depends entirely upon the Act above referred to. In construing a code the plain language of the statute must be given effect to Norendra Nath Sircar v. Kamalbasini Dasi (( 1895) L. R. 23 Ind. Ap. 18, at p. 26.), citing Bank of England v. Vagliano Brothers. ([ 1891] A. C. 167, at p. 145.) A reference to English authorities can