It remains to consider the effect of the paper "exhibit B," as an independent source of title.

This instrument authorized Mr. Jackson to take possession of all the goods and chattels in the store in Colorado Springs and to sell the same according to the terms of the mortgage, and to apply the proceeds in payment of his demands against the firm of Tribe & Jefferay.

The position of counsel is that this transfer amounted to an independent pledging of the goods and property of the firm for the payment of Jackson's claim.

Counsel for plaintiffs in error deny the power of one partner, under the circumstances of this case, to make such a transfer. They further say that Jackson did not rely on this order upon the trial below, as appears from his own testimony, but upon the mortgage and upon his possession. That the order distinctly referred to the mortgage, and authorized the mortgagee to take possession of the goods described in the mortgage. That this was its sole purpose and effect.

Upon the last proposition, we are of opinion that the phraseology employed in the latter instrument may be construed as an intention to make an independent transfer of the goods then in the store, together with delivery of possession. This transfer, if valid, would obviate the difficulty of identifying the goods conveyed by the mortgage, and vest a title thereto independent of the mortgage. The reference therein to the mortgage for the terms of sale, does not conflict with this theory. The object of the reference was merely as to the matter of procedure, and in legal contemplation was equivalent to incorporating in the order the same provisions upon this subject which were contained in the mortgage.

The only question of importance to be considered in this connection is, did the partner Jefferay, under the circumstances of this case, have power by the execution of this order, to make a valid transfer of the property to Jackson without the knowledge and consent of his copartner. The record shows that both partners resided in Colorado Springs, and that they had two stores, one in Colorado Springs and one in Leadville, Lake county; the one containing the principal portion of the stock in trade being in the former place. That Jefferay gave most of his atttention to this store, and Tribe looked after the business in Leadville, although he, Tribe, appears to have been frequently at the place of his residence. It is a notorious fact that the two localities are not distant one from the other, and that telegraphic and railroad communication exists between them.

The testimony shows that Tribe was not consulted about this transfer, and that Jefferay and Jackson well knew that he was opposed to the giving of the mortgage and had at different times refused to sign it. We think this equivalent to notice that he was opposed to any transfer or assignment of the stock to Jackson.

Another feature of the case, and one which discloses more fully the object of the transaction, is, that on the same day on which the

property in Colorado Springs was transferred to Jackson by this document (Ex. B) Jefferay confessed judgment in favor of Jackson for the sum of twelve thousand five hundred ($12,500) dollars in El Paso county district court. Upon this judgment an execution was issued to Lake county, and by virtue of it the entire stock in trade in Leadville, and certain parcels of real estate belonging to the firm were sold.

Here, then, is presented a case where a partner attempts not only to give a preference to a single creditor, but to give it in such a manner as to divest both partners of possession and control of the entire partnership property, effects and business. His acts were destructive of the partnership itself. These acts were not only done without the knowledge and consent of the copartner, but in opposition to his wishes, as previously made known to his partner and to the preferred creditor, when they asked him to join in the execution of the mortgage. Can a transfer of this nature, made under such circumstances, be sustained? The power of a partner to act for and in the name of his firm, says Mr. Justice Story, extends to all purposes within the scope and objects of the partnership, and in the course of its trade and business.

Adopting the suggestion of a learned judge, he adds: "One partner, by virtue of that relation (of partnership) is constituted a general agent for another as to all matters within the scope of the partnership dealings, and has communicated to him, by virtue of that relation, all authorities necessary for carrying on the partnership, and all such as are usually exercised by partners in that business in which they are engaged:" Story on Part., sec. 101.

Among the powers enumerated by this learned author, which may be exercised by one partner within the foregoing limits, is the power and authority, in behalf of the firm, to transfer, pledge, exchange or otherwise dispose of the partnership property and effects.

Mr. Parsons says: "The right of each partner to sell, assign or transfer any part or the whole of the partnership property, in the way of the regular business of the partnership is absolute and unquestioned, ** this, however, must be done in the regular course of the business of the firm, for outside of this he has no such power:" Parsons on Part., 163.

*

The views of Mr. Chancellor Kent are to the same effect: 3 Kent Com., 4 ed., p. 41.

The foregoing paragraphs concisely define the power of individual partners within the law applicable to general partnership. The substance of the rule is, that when acting in furtherance of the objects and business of the firm, and within the scope of its business, one partner is clothed with the full powers of all the partners, and is authorized to bind the firm in all transactions.

This power and authority is based on the principle of agency. The very nature and purposes of a partnership association necessarily constitutes, it is said, each active party a general agent of the firm, with implied authority to act for it in all matters of business

within the foregoing limits. The limitation referred to is of the highest importance. Upon it depends in a large measure the security of copartners. When an attempt is made by a single partner, without the consent of his associates, to bind the partnership in a transaction outside the usual scope of its objects and business, and one prejudicial to its interests, every principle of justice requires that courts should hold the act to be without validity. Especially should this be done, where, as in the present case, the contracting parties have notice of the copartner's dissent to such transaction.

The doctrine as to the effect of notice is thus stated in 1 Am. Ldg. Cases, 544: "The authority in a single partner, however, is not an insuperable legal consequence of an interest in the partnership, but is an actual agency, implied from the supposed assent of the other members; an express notice, therefore, from one member of a firm communicated to third persons, that he will not be bound by the acts, or by a particular act of another partner, puts a stop to the implied authority of that partner to bind the firm."

With these general principles before us, let us inquire more closely into the character of the transfer in the case at bar.

It was clearly not a sale, for no price was agreed upon at which the goods and effects should be taken and credited upon the indebtedness of the firm. Had it been an absolute transfer of the property in extinguishment of the debt, or a certain portion of it, a different question would arise.

Nor was it a pledge, for authority was given to sell all the property transferred. A pledge is defined to be a lien created by the owner of personal property by the mere delivery of it to another upon an express or implied understanding that it shall be retained as security for an existing or future debt. A pledge is subject to redemption, and the lien is immediately divested by a tender of the amount secured.

An action for possession may be maintained by the pledgor, if the pledgee refuses to restore the property. The title to the property remains in the pledgor, while the possession, actual or constructive, according to the nature of the property or circumstances of the case, is with the pledgee. The latter can only sell upon default of the pledgor to pay according to the contract: Bouvier's Law Dictionary, title "pledge;" 2 Parsons contracts, pp. 109-117; 3 Id., 271.

In Bowie & Sons v. Napier & Co., 1 McCord, 1, the court say: "By a pledge one understands not only a thing that may be redeemed, but, generally, one that is intended to be redeemed. Now, where goods are deposited with orders to sell, such an idea as that of redemption can never enter the mind, for the agent with whom they are deposited may, in the shortest space of time, alienate the right."

The effect of the transaction in the present instance was to transfer and surrender the property and stock in trade for the benefit of a single creditor, and at the same time to constitute such creditor the trustee of an implied or resulting trust in favor of the firm; the

terms of the trust were that Jackson should sell the property in a specified manner and apply the proceeds in liquidation of his claim.

If any surplus of money or property remained after satisfaction of his demands, as might have been the case, considering the simultaneous confession of judgment by the same partner, the assignee was bound to return the same.

It is evident then that this transfer was in the nature of, or analagous to, a voluntary assignment for the benefit of a creditor of the firm.

* * *

Says Mr. Burrill, in his valuable work upon assignments: "Voluntary assignments for the benefit of creditors are transfers without compulsion of law by debtors, of some or all of their property to an assignee or assignees, in trust to apply the same or the proceeds thereof, to the payment of some or all of their debts, and to return the surplus, if any, to the debtor.' The trusts of an assignment for the benefit of creditors, in one form or other, enter into the composition of all assignments which contemplate provisions or security for creditors, embracing not only such as are made to trustees, but such as are made directly to creditors themselves. Implied or resulting trusts are such as result from the transfer by intendment and operation of law: Burrill on Assignments, sections 2, 238, 240.

Both Mr. Justice Story and Mr. Parsons express grave doubts whether a partner can make a general assignment of all the property and effects of the partnership for the benefit of creditors. These doubts arise from the consideration that such a transaction is not in furtherance of the objects of a partnership, but of itself operates as a dissolution: Story on Partnership, sec. 101; Parsons, Part., * p. 166.

Mr. Parsons thinks the weight of authority is in favor of the power where the assignment is made without preferences of any kind. He qualifies the doctrine still further in a note to page * 167, after reviewing the cases on the subject. The further qualification is: "if such an act is justified by the situation of the firm at the time, and if the other partners are absent from the country, or have made the assignor sole managing partner, or if in any other way, expressly or by implication, they may be supposed to have conferred upon the assigning partner sufficiently extensive authority."

The case under consideration does not come within any of the exceptions mentioned. The other partner was not absent from the country. No emergency existed to justify or excuse hasty action without consultation with the co-partners. Jefferay had not been constituted sole managing partner at Colorado Springs, as appears from Tribes' repeated refusals to ratify the mortgage, and from his visit to and conduct at the latter place upon hearing of the transfer. Considering the contemporary acts of making the assignment and cenfessing the judgment in opposition to the known wishes of his co-partner, and in the light of their natural and actual consequences, viz, the destruction of the partnership in both places, it is evident

that the acts of March 18th were not based upon a supposed power of sole management at one point, but upon an assumed power of sole control, nolens volens, at both points and over the entire partnership business and property. The acts of Jefferay of March 18th were as destructive of the partnership as if the whole property of the firm had been included in a general assignment. These acts being contemporary, and having the effect of a general assignment for the benefit of a creditor, the law applicable to a general assignment becomes, by analogy, applicable to the assignment in the present case.

Concerning the power to make such an assignment, Mr. Justice Washington says, "But it may admit of serious doubt whether one partner can, without the consent of his associates, assign the whole of the partnership effects (otherwise than in the course of trade in which the firm is engaged) in such manner as to terminate the partnership:" Lord v. Graham, 4 Wash., C. C. 232.

The authorities bearing upon the subject are reviewed in Bowen v. Clark, 1 Bissell, 128. The conclusion arrived at is as follows: "The principle to be extracted from nearly all the decisions appears to be this, that as a general assignment, if it does not dissolve the partnership, it at least takes away from the partners the right of disposing of the effects assigned; all the members, if they are present, have a right to be consulted on such a step; that an assignment by one partner against the known wishes of another would be a fraud upon him and invalid, and an assignment without his knowledge would be presumptively so.

The New York court of appeals held in Wells v. March, 80 N. Y., 350, that such an act was outside the scope of the partnership enterprise and that the exercise of such a power amounted to a suspension or dissolution of the partnership itself. Said Mr. Justice Wright, "it is no part of the ordinary business of the partnership, but outside, and subversive of it. No such authority as that can be implied from the partnership relation."

The question was considered in Holland v. Drake, 29 Ohio St., 441. "Whether one member of an insolvent firm either before or after the dissolution of the partnership can make a valid assignment of all its effects for the benefit of creditors against the will of a copartner, or without procuring his assent, when present or accessible."

Chief-justice Welch, in delivering the opinion of the court, speaks of the want of conformity in the numerous decisions, and concludes as follows: "We have examined these cases with much care, and think the weight of authority as well as the better reasoning is with those who deny the validity of such an assignment. The power to make it is not within the contemplation of an ordinary partnership contract."

The opinion of the court is that the safer and juster rule is to require either the actual or implied assent of all the partners.

The court of appeals of Kentucky concedes the power and authority of each partner, in behalf of the firm, to transfer, pledge