[ PRIVY COUNCIL.]

1927 Present: The Lord Chancellor, Lord Carson, and Lord Darling.

ARSECULERATNE v. PERERA.

Ordinance of Frauds and Perjuries-Agreement in writing to prospect for plumbago-Transfer of lease of mines-Proof of partnership-Action for account-Ordinance No. 7 of 1840, s. 22.

By an agreement in writing, which was not notarially executed, the plaintiff and the defendant agreed to prospect for plumbago in certain mines. The agreement provided, inter alia, " that the defendant should give over to the partnership his interest in a lease which he had taken from the owner of a mine; that the partners should contribute equally to the expenses incurred on the pits; and that they should be entitled to the profits and liable for the losses in equal shares." The mine was worked under the management of the plaintiff from the date of the agreement for a period of two years, when it was abandoned by mutual arrangement. The plaintiff sued the defendant for a dissolution of the partnership and an account.

Held, that the agreement was valid for the purpose of establishing the partnership, although it was void as an agreement to effect a transfer of the lease; and that the plaintiff was entitled to an account.

The equitable doctrine of part performance has no application to the stringent provisions of section 2 of Ordinance No. 7 of 1840,

Pate v. Pate 1 [(1915) A. C. 1100.] distinguished.

APPEAL from a judgment of the Supreme Court.

December 6, 1927. Delivered by THE LORD CHANCELLOR.

This is an appeal from a decree of the Supreme Court of Ceylon affirming a decree of the District Court of Colombo in an action in which the appellant was plaintiff and. the respondent was defendant.

By an agreement in writing dated December 21, 1915, the respondent and the appellant agreed to prospect for plumb ago at the Pattagoda mines under the name of the Pattagoda Mining Company. The agreement provided that the respondent " would thereby give over " his interest in the lease which he had taken from the owners of the mine (which had still eight years to run) to the Company; that the appellant should manage the mine and receive a commission of 21/2 per cent, on all transactions; that the partners should contribute equally to the expenses to be incurred on the pit or pits; and that they should be entitled to the profits

and liable for the losses in equal shares. The agreement was signed by both parties, but the signatures were not attested by a notary or witnesses. The mine was duly worked under the management of the appellant from the date of the agreement until the month of January, 1918, when the working was stopped by mutual arrangement.

On January 25, 1923, the appellant brought this action against the respondent pleading the above facts and alleging that lie (the appellant) had paid or borrowed monies in respect of the business amounting to Rs. 72,857 and was entitled to commission amounting to a further Rs. 1,504; and the plaintiff claimed h dissolution of the partnership and payment by the defendant of one-half of those sums or of such sum as might be found due upon an account being taken. The respondent by his written statement admitted that he had agreed to work the Pattagoda plumbago pits under the name of the Pattagoda Mining Company, that the profits and losses were to be divided equally, that the plaintiff was to manage the business for a commission of 21/2 per cent., and that the business had been carried on as alleged; but he pleaded that the agreement of December 21, 1915, on which the plaintiff's action was based, was invalid in law. Issues were framed, which included the following: -

(1) Is the document containing the agreement between plaintiff and defendant invalid in law inasmuch as it has not been notarially executed and has not been duly stamped?

(5) Had plaintiff authority to borrow money for the working of the partnership ?

(6) Is de