be established in the same way that agencies generally are established either by direct proof of the agency, by an acceptance of the fruits without protest or objection, or by such a holding out as to create an estoppel.1 And if a custom is relied upon, either in respect of the appointment of the agent, or the nature, quality and extent of his authority, it must be strictly construed, and not extended beyond the narrowest limits essential to the operation of the business."

1537. Agency confined within strict limits Greatest emergency does not justify departure from strict rule.If we shall preserve the time-honored distinction which has characterized the dividing line between commercial and mining partnerships, it will be necessary to resist encroachment upon that line at every step; and there is no reason in saying that these partnerships cannot be controlled by their own guiding principles the same as any other branch of the law, and the greatest extent to which the authority of one member to bind the others should be recognized, is for the purchase of such supplies or the employment of such assistance as is absolutely necessary. Beyond this the authority should never be presumed. Ordinarily the only question to be determined is whether the proof shows that the authority exercised by the agent is necessary to the carrying on of the concern, or usual in similar concerns. In this connection

Armstrong, 9 Colo. 47, 10 Pac. Rep. 232; Skillman v. Lachman, 23 Cal. 198; Taylor v. Castle, 42 Cal. 367; Washburn v. Alden, 5 Cal. 463; Jones v. Clark, 42 Cal. 180.

1 Randall v. Meredith, 76 Tex. 669, 13 S. W. Rep. 576; ante, § 1535. 2 See note 3, p. 1147, supra. See also ante, § 1535; post, ch. IV, this Part.

3 Meagher v. Reed, 14 Colo. 335, 24 Pac. Rep. 681, quoting from Coll. Mines, 125, and citing Crawshay v.

Maule, 1 Swanst. 495: Ferreday v.

3

Wightwick, 1 Rus. & M. 45; Williams v. Attenborough, 1 Turn. & R. 70; Dickenson v. Valpy, 10 Barn. & C. 128; Colly. Partn., §§ 801, 808; 1 Bates, Partn., § 163; Charles v. Eshleman, 5 Colo. 107; Manville v. Parks, 7 Colo. 128, 2 Pac. Rep. 212; Skillman v. Lachman, 23 Cal. 199; Duryea v. Burt, 28 Cal. 569; Kahn v. Central Smelting Co., 102 U. S. 641; Bissell v. Foss, 114 U. S. 252, 260; Lamar v. Hale, 79 Va. 147. See also Ricketts v. Bennett, 4 C. B. 686.

it must be borne in mind that the credit is generally extended to the agent or manager personally, often without any knowledge that the person afterwards sought to be charged has any interest whatever in the business. In such case, the credit not having been extended on the strength of any promise of his, he should not be held liable. This feature is especially noticeable in the Texas case.1

§ 1538. Agency by express authority or by adoption of fruits. Following these principles, then, to their legitimate conclusion, the agency of a mining partnership can only be created so as to bind all the members by direct authority, at a meeting or after consultation with all the members, where all may debate and vote, or give their opinion, on the question, and by a majority as above specified, or by the voluntary adoption of the fruits of the questionable act, or a holding out so as to work estoppel. The doctrine is thus stated by Mr. Lindley: "As in the case of general partnership, the minority must be consulted. Any other course of proceeding on the part of the majority is not in good faith." 2

In a Texas case, which we noted at some length in a preceding section,3 T. was the partner operating the mine, and was limited by express instructions to a certain amount; M. loaned him money to continue the mining operations, but there was some dispute as to what M. knew, if anything, as to the special instructions to T. M. sued T., who suggested the bringing in of his other partners, which was accordingly done, and they defended upon the ground that T. exceeded his authority and went beyond his express and positive instructions. In denying to T. the authority to borrow money, the court uses these words: "If a partner be not given express power to borrow money, and the busi

1 Randall v. Meredith, 76 Tex. 669, v. Creary, 30 Cal. 291; Hawkins v. 13 S. W. Rep. 576. Spokane H. M. Co., 33 Pac. Rep. 40.. 3 Ante, § 1530.

2 Lindl. Mines, 800, citing Lindl. Part., p. 600. See also Dougherty

ness or course of business of the firm or like firms be not such that therefrom such a power may be implied, then there is no reason for holding a firm bound for a loan made to and on the sole credit of one partner, simply because he may have used the money for a partnership purpose." 1

§ 1539. Power to borrow money.- From the position of the Texas court as stated in the last preceding section, it cannot be gainsaid, indeed it would seem plain, that the agent, the operating partner, has not the implied power to borrow money on the credit of the firm. In that case the authorities were carefully collected, and the consensus of opinion stated in the following words: "It has been generally held that mining partnerships are non-trading partnerships, and the individual members of the firm without power to borrow money on the credit of the firm, unless the power be given otherwise than by implication from the ordinary nature of the business." 2

§ 1540. Not a trading partnership. In the last case in the preceding section the court distinguishes between a mining and trading partnership, quoting from a leading authority in the following words: "A mining partnership is a non-trading partnership, and its members are limited to expenditures necessary and usual in the particular business."

§ 1541. Management of property - Compensation of manager. It must be apparent that the management of a

1 Randall v. Meredith, 76 Tex. 669, 13 S. W. Rep. 576.

2 Randall v. Meredith, 76 Tex. 669, 13 S. W. Rep. 576, citing (which see) Bates, Partn., §§ 329, 371; Lindl. Partn. 266-270; Colly. Partn. 658, 686, note 2; Pars. Partn. 108, 218 and note; Story, Partn., § 126; 1 Story, Cont. 279; Daniel, Neg. Inst., § 357-359; Childers v. Neely (W. Va.), 34 S. E. Rep. 828.

3 Childers v. Neely, 47 W. Va. 70, 34 S. E. Rep. 828. See also Bates, Partn. 329; Waldron v. Hughes, 44 W. Va. 126, 29 S. E. Rep. 505; Judge v. Braswell, 13 Bush, 67; McConnell v. Denver, 35 Cal. 365: Pooley v. Whitmore. 27 Am. Rep. 735; Deardorf v. Thatcher, 78 Mo. 128: Pease v. Cole, 53 Conn. 53, 22 Atl. Rep. 681.

partnership must be committed to some person. In this respect it is similar to a corporation. When once committed, the manager must be free from irregular interference. Lord Eldon illustrated this truth as follows: "In my country, where there are frequently twenty owners of the same mine, if each is to have a set of miners going down the shaft to work his twentieth part, it would be impossible to continue working the mine. Must not a contract be implied that it was to be carried on in a practicable and feasible way? Where there are part owners of a mine, and they cannot by contract agree to appoint a manager, this court will manage it for them." As a general rule, the managing partner is not entitled, in the absence of a special agreement, to compensation.2

1

ARTICLE C.

Distinctions from Tenancy in Common.

§ 1545. General distinctions from tenancy in common.

1546. When parties treated as partners.

1547. Rule where tenants in common unite to work mine- May sell to each other - No right of pre-emption.

1548. The rule as to ditch associations. 1549. Partners in the extraction of ore. 1550. Part of common law.

§ 1545. General distinctions from tenancy in common. It will thus be seen that tenants in common are not necessarily partners, nor does the mere doing of assessment work make them such. The distinction, and the only one material here, arises when they unite in operating beyond mere assessment work, instead of operating separately. The supreme court of Colorado says: "To the extent of their interest in the property they are tenants in common, and in the work

1 Jeffrey v. Smith, 1 J. & W. 298, followed in Roberts v. Eberhardt, 1 Kay, 148. See also Walters v. Tay

lor, 15 Ves. 10; Denys v. Shuckburg, 4 Y. & E. 42.

2 Godfrey v. White, 43 Mich. 171. See Levy v. Carrack, 13 Iowa, 158.

ing of the mine they are to be considered as partners." But a dissenting tenant in common is not a partner in working the mine when operated by others against his wish.?

§ 1546. When parties treated as partners.- Here, as in all other branches of the law, courts look to the actions of the parties, rather than the name they give themselves, in determining their rights and duties. Thus, where the parties designate themselves a corporation, but fail to properly file their articles and otherwise comply with the law, they will not be recognized as a corporation, but will be held as partners. In the California case the facts showed the mining property to have been worked by the owners as an unincorporated company, which they styled the Hibernia Mining Company. The principal question for determination, it seems, was whether certain of the members had forfeited their interest. Therefore the court, while holding that there was no corporation, expressed no further opinion on that point. But it must be apparent that the parties were mining partners, pure and simple.

§ 1547. Rule where tenants in common unite to work mine- May sell to each other No right of pre-emption. Where tenants in common of a mine unite for the purpose of working it, each owner is entirely free to act, touching his interest in the mine, as he may see fit. There is no right of pre-emption of the interest of a retiring partner. Each member has power to dispose of his interest in the mine to whomsoever he wishes, and is free to deal with his

1 Manville v. Parks, 7 Colo. 128, 2 Pac. Rep. 212, citing Dougherty v. Creary, 30 Cal. 300; Duryea v. Burt, 28 Cal. 569; Skillman v. Lachman, 23 Cal. 200. See also Lyman v. Schwartz, 13 Colo. App. 318, 57 Pac. Rep. 735; Higgins v. Armstrong, 9 Colo. 38, 10 Pac. Rep. 232; Anaconda Copper M. Co. v. Butte

& B. M. Co., 17 Mont. 519, 43 Pac. Rep. 924.

2 First Nat. Bank v. G. V. B. M. Co., 89 Fed. Rep. 449.

3 Hill v. Beach, 12 N. J. Eq. 31; Abbott v. Omaha S. Co., 4 Neb. 416. See also New York Iron Mine v. First Nat. Bank, 39 Mich. 644; Wiseman v. McNulty, 25 Cal. 230.