SPROULE J

[His Lordship stated the facts of the case and continued:-]

The main line of the defence is that the raising of money or the pledging of the credit of the firm was not incidental to the carrying on of the business of the firm, and that Ang Siow Ngoh had no authority to sign the notes. The plaintiff's reply to that is (a) that the defendant chop held out Ang Siow Ngoh as its proprietor or a partner (b) that he actually was a partner.

Now it is clear from what I have found to be the nature of the defendant's business that it is a non-trading firm and that the raising of money on credit or the guaranteeing of another borrower is not incidental to the carrying on of its business. If authority were needed for this, it is to be found in Yates v. Dalton [1858] 28 LJ Exch. 69. Again the plaintiff, by enquiring, could have ascertained what the nature of the business was.

It is clear also that Ang Siow Ngoh had no express authority to pledge the firm's credit, whether by power of attorney or otherwise, which fact again the plaintiff could have ascertained by inquiry.

Again, a mere authority to draw cheques in the name of a non-trading firm (which authority I have held was possessed by the manager) does not imply any authority to draw or sign bills of exchange or promissory notes where these are not incidental to the carrying on of the business of the firm, see Forster v. MacKreth [1867] LR 2 Exch. 163.

Even if Ang Siow Ngoh had been actually a partner or had been held out by the defendants as a partner in their non-trading firm, I do not see how that could possibly help the plaintiff. A partner in a non-trading firm, the pleading of whose credit is not incidental to, or within the scope of, its business, cannot bind his co-partner by a guarantee pledging the credit of the firm; not even in the extreme case when such guarantee is a reasonable mode of carrying into effect an acknowledged partnership contract - see Brettel v. Williams [1849] 4 Exch. 623, unless there be previous authority or subsequent ratification; and there is no question of either in the present case.

The case of Raman Chitty v. Ng Siang Ee and Ors 9 SSLR 90, is easily distinguishable. There the borrowing of money on promissory notes was held to be one of the ordinary objects of the business and within the scope and aim of the partnership, and in such a case a partner can certainly bind the partnership by notes purporting to be signed by him for the firm to a third party not having notice of private arrangements between the partners limiting his authority.

A similar principle was applied in Edmunds v. Bushell and Jones LR 1 QB 97. Edmunds traded as Bushell & Co., and Bushell was merely his agent. The agent's instructions were not to draw or accept bills of exchange, but the drawing and accepting of bills was incidental to the ordinary carrying on of the business, and a previous acceptance had been ratified by Edmunds. There was a clear "holding out" here, and the principal was held liable to a third party who knew that the drawing and accepting of bills was incidental to the business of Bushell & Co., but had no notice of the secret limitation of the agent's authority.

It seems clear to me therefore that the defence is a complete answer to the plaintiff's claim unless the plaintiff can establish his allegation that the defendant firm held out Ang Siow Ngoh as its owner or principal.

[His Lordship then dealt with the evidence upon which the plaintiff relied on this part of the case].

There is not one title of evidence therefore to connect Lim Pah Kiat with any knowledge of or responsibility for the false representation or the mistaken repute, which latter, if it existed, may well have been engendered and fostered for his own purposes by the dishonest and defalcating manager.

As for Ang Siow Ngoh's possession of the firm's chops, it is argued that these are indicia of title and that their possession implies complete power to act in the propr