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New Statutes effecting Alterations in the Law.—Limited Liability Partnerships.

That further provisions should be made for carrying into execution in such colony, the orders of the Commissioners; for reconciling any conflict between the laws of England and such colony; for declaring the law with respect to any matter or thing; or otherwise for more effectually bringing this Act into operation within any colony, or carrying into effect the purposes thereof;

Jamaica.
Barbadoes.
St. Vincent.
Grenada.
Tobago.
St. Lucia.
Antigua.
Dominica.

SCHEDULE.

St. Christopher.
Montserrat.

Nevis.

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The Virgin Islands.
British Guinea.
Trinidad.

The Bahamas.

The Turks Islands.

LIMITED LIABILITY PARTNER-
SHIPS.

It shall be lawful for the Commissioners having due regard to the interests of owners, incumbrancers, and others, and to the laws and customs of the colony, by order under their seal to make any such substitutions or pro. visions as aforesaid, subject to the restrictions Ar a General Meeting of the Law Amendfollowing; namely, that such substitutions or ment Society, Nov. 6, 1854, the following provisions shall not be repugnant to the spirit of this Act or to the general law of England, and shall not affect the constitution of the Commissioners as established by this Act; but no such order shall be of any force till the same has been confirmed by order of her Majesty in Council in manner hereinafter-mentioned.

67. Before any such order shall be capable of confirmation, it shall for the space of 30 days be submitted to the Legislature of the colony within which the same is intended to operate; and if such Legislature, within such period as aforesaid, express by resolution their disapproval thereof, such order shall thereupon be void to all intents; but if the Legislature, within the said period, express by resolution their approval thereof, or come to no resolution in respect thereof, the same shall thereupon be presented to her Majesty for confirmation, and, if so confirmed, shall, as soon as conveniently may be, be proclaimed in the colony, and upon such proclamation being made shall have the same force within such colony as if the same had been enacted by authority of Parlia

ment.

68. Any order so confirmed as aforesaid may from time to time be rescinded, amended, or altered, as occasion may require, by other orders, to be made by the Commissioners, and to be submitted to the Legislature of the colony, and confirmed in like manner.

69. Her Majesty may from time to time, by order in Council, direct this Act to come into operation in any of the said scheduled colonies, and thereupon, but not otherwise, the same shall have the force of law in such colony or colonies named in any such order; but no such order in council shall be made in respect of any colony until the Legislature of such colony has presented an address to her Majesty, praying her Majesty to issue such order, and has also, to the satisfaction of her Majesty's principal Secretary of State for the Colonies, made provision for the payment of the salaries of the local Commissioners, and of all such assistant secretaries, clerks, messengers, and officers as may be appointed under this Act in such colony, and of such other expenses of carrying this Act into execution as are hereinbefore directed to be provided for by the Legislature of the colony.

paper was read by Andrew Edgar, Esq., Barrister-at-Law, and referred to the Committee on Commercial Laws, with a request to take the subject into immediate consideration.

"The recent resolution of the House of

Commons or the subject of partnership with limited liability, and the prevailing opinion of the public on the question, render it certain that considerable changes will shortly be introduced into the existing law. It is not to be denied, however, that amongst the mercantile community their exists a formidable, though by no means general, opposition to any extensive change in the present law; while amongst those persons who are favourable to the principle of limited liability, there is some difference of opinion, both as to the extent to which it should be admitted, and as to the best mode of carrying it out and insuring it against abuse.

"Although this Society, therefore, has already inquired into the question, it seems wise and expedient to recur to the subject at the present time. From the recent establishment of various sectional committees, the opportunity is now afforded of considering the matter in all its different bearings and ramifications, and of thus arriving at results which may aid materially in the final settlement of the question. The subject may be referred generally to the different committees, each of which will consider that section of the question which comes within its own province, or it may be referred specially to the Committee on Commercial Laws, which will receive assistance from the other committees on the different points which fall under the cognizance of each respectively.

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"The views of those who are in favour of

the introduction of the principle of limited liability into our law, rest on the clear and intelligible proposition, that it is not expedient to prohibit by law, persons from entering into partnership, and to prohibit them and others from dealing together, on the terms that the liability of one, or more, or all of the partners should be limited.' This proposition, inde

"See First Report of Commissioners on Opinion of Mr. Bramwell, Mercantile Laws. p. 23," published in the Legal Observer of 15th July, 1854.

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Limited Liability Partnerships.

pendently of the authority which it derives tion between active and dormant partners as

from the rules of enlightened jurisprudence, is supported by unquestionable evidence of the evils and hardships produced by the present law in this country, and of the advantages flowing from a different system in other

countries.

long as the latter remain in the firm, I am at a loss to understand how there is anything opposed to the original principles of our jurisprudence in limiting the liability of the latter under certain circumstances. I do not allude to joint-stock companies incorporated by Act of Parliament or by Royal Charter, which partake rather of the nature of privilegia in the Roman Law; although, if the doctrine contended for be right, and its violation be as inconsistent with the principle of English Law as of justice, to allow the Board of Trade to grant charters authorising limited liability must be as impolitic and unjust as, in the language of Mr. Lowe, to allow the Secretary of the Treasury to grant dispensations for smuggling, or the AttorneyGeneral licences to commit murder.' But the general principle of our law is that notice, or express stipulation, will limit the liability of partners as well as of other contracting parties. In some cases, where the business of a partnership is conducted by means of written documents, this is possible, and is commonly done in the case of life, fire, and marine insurance. "It is necessary, however, in such a ques- This method, however, is of extremely limited tion as the present, for the reason already application; and in the ordinary departments stated, that the objections to which I have al- of trade, it is practically impossible to adopt luded should be carefully examined; and for such a course. But if the names of all the this purpose I am anxious, on the present oc- dormant members of a partnership whose lia. casion, to call attention to the Report of a bility was limited, and the amount of capital Committee of this Society in 1849, to whom it agreed to be advanced by such limited partners, had been referred to consider the law of part- were registered and duly published, and the nership with reference to the liability of part-style of the firm should indicate its character, ners. The opinion of a majority of that Com- so as to make notice a reasonable presumption, mittee was in favour of allowing the formation of partnerships in which the responsibility of certain of the partners should be limited to the amount of capital advanced by them, under proper restrictions for the prevention of fraud. The minority came to an opposite conclusion, I am aware. The same observation would apand stated, in a separate paper, their reasons against the recommendation contained in the Report of the Committee. As I fully concur in the resolutions of the Committee as far as they go, and as the paper of the minority appears to me to embody the leading objections which | "With regard to reckless and fraudulent can be urged against the system of limited lia- trading, which it is objected would result from bility, and are substantially the same as those partnerships with limited liability, I cannot brought forward by the majority of the Mer- think that that which now exists is likely to be cantile Law Commissioners in their first report, very much increased by the proposed change. I do not think I can better re-introduce the Of course it would be necessary that the most subject to the consideration of the society than stringent provisions should be adopted against by examining some of the principal points of fraud. One thing is clear that the present state objection in the paper to which I have referred. of the law has a tendency to prevent honourThese, I may observe, are entirely directed able and intelligent persons from having any against the principle recommended in the re-thing to do with joint-stock companies, and to port; and are chiefly founded on prudential and economical grounds. There is one objec tion, however, of a legal nature which calls for observation. The second reason stated is, Because it is as inconsistent with the principle of English Law as with justice that the risks and losses incidental to commercial speculation should not be borne by those who originate them, and who alone are to receive the profits if any arise.' Now, although, according to modern decisions, the law makes no distinc

"But strong as the case is in favour of a change in the law of partnership, there are various objections still urged against it in certain quarters. Those objections would not, at the present stage of the question, be entitled to much consideration, did they not proceed from men of great mercantile experience, and whose interests may be regarded as involved in the matter. Even admitting that there was some force in the objections referred to, they would only illustrate what Archbishop Whately calls the Fallacy of objections; i. e., showing that there are objections against some plan, theory, or system, and thence inferring that it should be rejected when that which ought to have been proved is, that there are more or stronger objections against the receiving than the rejecting of it.'

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and at all events throw the duty of inquiring on the party contracting with the partnership, I can scarcely think that this would be inconsistent with the real principles of English Law, far less with any principle of justice of which

ply to associations and companies where the liability of every member was limited; and in this case, indeed, it would only be allowing parties to do for themselves what the Crown or the Legislature can now do for them.

leave their formation to the more speculative part of the community. Nor does it seem at all doubtful that there would be less room, under a system of limited liability, for the indolence, the carelessness, the positive dishonesty with which parties are too apt to enter into con tracts with companies when they know that every individual member is liable to his uttermost farthing. Mere bubble schemes, however high and respectable the names which they might put forth, would have small chance of success,

Limited Liability Partnerships.

145

when the furthest extent of their resources would pital advantageously to introduce. If any one be easily known, and when the indefinite liability, is of opinion that the resources of this country which now gives such schemes all their facti- have been fully developed, or that the capital tious credit and importance, was withdrawn. we possess is sufficient, under the present law Independently of this, with regard to such of partnership, to carry them to their utmost periods of excitement and panic as those of limits, he will of course reject my argument; 1824-5, 1836, 1841, 1845, 1846, and 1847, I but believing as I do, that much remains to be believe that the present law of partnership had accomplished, both in trade and agriculture, no inconsiderable effect in giving rise to the and that whatever capital is in existence should perturbations which then took place. Unless be made available for this purpose to its fullest there had been an immense amount of capital extent, I can admit of no distinction between in the country which was not profitably em- this and poorer countries; and when I see that ployed, the opportunity would not have been this country is capable of being rendered so afforded for the schemes which caused the much richer than it is, I must demur to any panic and excitement in those periods; and objection to a change of the law which proceeds the best preventive of their recurrence seems upon the idea that we already have enough of to be to afford convenient means for the pro- capital for all beneficial purposes. For in truth fitable investment of capital by a system of the whole of this objection seems to involve the limited liability, which by equalising the pres- notion, unsound in every economical view, that sure will render it wholesome and beneficial. a country can have too much capital, or that "But the great objection stated by the mi- all its capital should not be made available to nority of the Committee, and which still forms the highest degree. Else why if the system of the leading ground of opposition against limited limited liability is advantageous in giving full liability is, that although such a system may effect to the capital of a poor country, are we suit a country where capital is scarce, it is in- to be deprived of the benefit? This is the applicable to, and would be dangerous in, this strict logical result of such an objection, and it country, where there is no want of capital to amounts therefore to a most obvious reductio carry out any enterprise the prospects of which ad absurdum. are capable of reasonable demonstration. Now! If it be true that there is some fear on the this objection, I venture to think, is altogether part of capitalists of the rivalry of societies and fallacious. There is a large class of the com- partnerships under the principle of limited liamunity active and enterprising, but with whom bility, I venture to think that such fear is uncapital is scarce, on whom the system would warranted by the sound principles of economioperate as beneficially as it does in those cal science. The general increase of the capital countries generally which are limited in point of the country, or the rendering more available of capital; and it is impossible to overlook what exists, must operate favourably on every the case of such, notwithstanding the general branch of trade. New enterprises undertaken, wealth of this country and the abundance of new fields of industry cultivated, and new resources that may be at hand for carrying out markets opened up do not necessarily interfere every reasonable enterprise. But with regard with the old ones. And if the present law does to capital never being wanting to carry out any give to those possessed of large capitals a moreasonable enterprise, this is a view from whichnopoly in certain departments of trade and maI beg totally to dissent. If we confine our at-nufactures, I have yet to learn that such a state tention to trade and manufactures as carried on of things tends to the public advantage, or in the great commercial districts of the country, that those who benefit by it would not benefit there may be some appearance of truth in the still more under a system of unlimited compeproposition. But the moment we extend our tition and the full development of all our review over the whole country, and take into ac-sources. count the agricultural, as well as the trading "There is one aspect of the question which and manufacturing interests, we shall find that I am anxious to bring before the notice of the there is a great want of capital, and that this society, both because I think it has not occuwant operates in the most unfavourable manner. pied a sufficiently prominent place in most of Not only are there many small towns advan- the discussions on this subject, and also betageously situated for manufactures and trade cause, although it really forms the most imwhich vegetate from generation to generation, portant element in the whole question, it does not only are many works of public utility, and not strictly fall within the cognizance of any of which might be ultimately profitable to their our committees. I allude to the social bearpromoters, left unattempted throughout the ings of the question,-its relations to the precountry, but a large proportion of land ca- sent state and prospective condition of the pable of being profitably cultivated remains working classes. The great inequality of prounimproved, while a very considerable propor-perty in this country is no doubt production of that which is under cultivation yields tive of many social evils; and all laws whose only half returns, in consequence of the want tendency it is artificially to maintain this inof capital on the part of landholders and far-equality, must be regarded as impolitic and mers. And the evil is daily becoming more unwise. Such are the law of primogeniture and felt in this latter case, since the present state of the law of unlimited liability in partnership. agricultural science has suggested many im- The latter of these is no doubt productive of provements which it requires considerable ca- the greatest evils. What the working classes

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Limited Liabilities.-Review: May's Treatise on the Usages of Parliament.

NOTICES OF NEW BOOKS.

A Practical Treatise on the Law, Privileges,
Proceedings, and Usage of Parliament.
By THOMAS ERSKINE MAY, Esq., of the
Middle Temple, Barrister-at-Law, one of
the Examiners for Standing Orders in
both Houses of Parliament, and Taxing
Officer of the House of Commons. Third
Edition, revised and enlarged. London:
Butterworths. 1855. Pp. 704.

feel,' says Mr. J. S. Mill, 'is not so much the inequality of property, considered in itself, as the inequality consequent upon it, which unhappily exists now, namely, that those who already have property have so much greater facilities for getting more, than those who have it not, have for acquiring it.' That the present law of partnership throws impediments in the way of working men acquiring property, is a matter of which there can be no question. The expense and difficulty of obtaining an act or a charter render it impossible for them to undertake schemes on the principle of limited liability, and with regard to ordinary partnerships, the THIS new edition of Mr. May's Practice formidable responsibility which may be incurred comprises the latest precedents of parliaprevents persons possessed of capital from as- mentary proceedings to the end of the last sisting working men in undertakings which they Session; and the numerous changes of might often be qualified to carry on effectively. practice, particularly relating to private And what renders the evil more serious is, that Bills, are carefully introduced into the at the present day trade and manufactures can work, with much new matter and very nuin general only be carried on successfully by means of large capitals; so that the difficulty merous references. of a working man in bettering his condition is The first part of the volume treats of the now greater than ever, and those who have constitution, powers, and privileges of Parsaved a little money have no means of invest- liament; the second of the practice and ing it at a profit at all proportionate to that proceedings in Parliament; and the third, which their employers enjoy. Of course, all the manner of passing private bills. this tends to prevent the formation of habits This third division of the work contains of frugality and saving among the working the following chapters:

classes, and to foster a general spirit of discon

tent with their condition, which leads them "Distinctive character of private bills: preoften to regard unfavourably the legitimate liminary view of the proceedings of Parliament profits of capital. The consequence of which in passing them.

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is, that a hostile spirit subsists to a very great "Conditions to be observed by parties before degree in the manufacturing districts between private bills are introduced into Parliament: employers and employed, and which occasion- proof of compliance with the standing orders. ally breaks forth in the strikes' and 'lockouts,' from which the general interest of the country suffers, and which threaten our whole social system.

"I cannot but think that if a system of partnership with limited liability were introduced, which would allow the working classes to unite together in carrying on the business with which they were acquainted, and which should afford greater facilities for intelligent and industrious artisans being taken into partnership by their employers, or receiving assistance from persons possessed of capital, it would tend both to the prosperity of the country, and to the peace and happiness of a large portion of the community. Considering the discontent and the socialist tendencies which undoubtedly exist in the manufacturing districts, I see no remedy for the present evils so direct and efficacious as a change in the law, which should afford to the working classes the opportunity of becoming capitalists themselves, and participating, ac cording to their industry and frugality, in the profits of capital. And with the views which entertain, I do not rest the matter solely on the grounds of policy and expediency; but regard the change with reference to the working classes, as well as to the rest of the community, as a measure of substantial justice."

I

Course of proceedings upon private bills introduced into the House of Commons; with the rules, orders, and practice applicable to each stage of such bills in succession, and to particular classes of bills.

"Course of proceedings in the Lords upon private bills sent up from the Commons.

"Rules, orders, and course of proceedings in the Lords upon private bills brought into the House upon petition: and proceedings of the Commons upon private bills brought from the Lords. Local and personal, and private Acts of Parliament.

"Fees payable by the parties promoting or opposing private bills. Taxation of costs of parliamentary agents, solicitors, and others."

From the last chapter relating to Fees payable and the taxation of Costs, we extract the following passages :

"The fees which are chargeable upon the various stages of private bills, and are payable by the several parties promoting or opposing such bills, have been settled in both Houses. The tables of fees are well known to parlia mentary agents; they are published in the standing orders of the Commons, and in the House of Lords they are separately printed and are readily accessible to parties interested.

"It is declared by the Commons, "That every Bill for the particular interest or benefit

Review: May's Practical Treatise on the Law, Privileges, and Usages of Parliament.

of any person or persons, whether the same be brought in upon petition or motion, or report from a Committee, or brought from the Lords, hath been and ought to be deemed a private bill within the meaning of the table of fees;' and that the fees shall be charged, paid, and received at such times, in such manner, and under such regulations, as the speaker shall from time to time direct.''

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and

a re

in the Lords. Both these Acts, however, were
very defective and have since been repealed.
By the present House of Commons
House of Lords Costs Taxation Acts,'
gular system of taxation has been established
in both Houses, and every facility is afforded
for ascertaining the reasonable and proper
costs arising out of every application to Parlia-

ment.

them.?

"In each House there is a taxing officer, having all the necessary powers of examining "In both Houses there are officers whose the parties and witnesses on oath, and of callspecial duty it is to take care that the fees are ing for the production of books or writings in the hands of either party to the taxation. properly paid by the agents, who are respon-Lists of charges have been prepared, in pursusible for the payment of them. If a parliamentary agent or a solicitor acting as agent for ance of these Acts, in both Houses, defining any hill or petition be reported as defaulter in the charges which parliamentary agents, solithe payment of the fees of the House, the citors, and others will be allowed to charge Speaker orders that he shall not be permitted for the various services usually rendered by to enter himself as a parliamentary agent, in any future proceeding, until further directions "Any person upon whom a demand is made have been given. In the House of Commons by a parliamentary agent or solicitor, for any the whole of the fees were formerly collected costs incurred in respect of any proceedings in and carried to a fee fund, whence the salaries and expenses of the establishment were partly the House, or in complying with its standing defrayed; the balance being supplied from the orders, may apply to the taxing officers for the Consolidated Fund. But by the 12 & 13 Vict. taxation of such costs. And any parliamentary c. 72, all moneys arising from the fees of the agent or solicitor who may be aggrieved by House are carried to the Consolidated Fund; the nonpayment of his costs, may apply, in the and the officers are paid from the public revenues. In the House of Lords a considerable same manner, to have his costs taxed, prepaportion of the fees is appropriated to a general fee fund; but a part is still reserved for the particular use of officers, whose emoluments

are derived from that source.

"In the case of Chippendall's Divorce Bill in 1850, the promoter petitioned to be allowed to prosecute the bill in formá pauperis, and in both Houses this privilege was conceded to him, on proof of his inability to pay the fees. The Committee on the bill in the Commons, to whom his petition had been referred, distinguished his case from that of the suitor for any other kind of bill, and considered that the remission of the fees would not afford a precedent in other parliamentary proceedings." "In pursuance of an address of the House of Commons, in 1829. the fees payable upon all bills for continuing or amending Turnpike Road Acts, which receive the Royal Assent, are discharged by the Treasury.3

ratory to the enforcement of his claim. The client, however, is required by the Act to make this application within six months after the delivery of the bill. But the Speaker in the Commons, or the Clerk of the Parliaments in the Lords on receiving a report of special circumstances from the taxing officer, may direct costs to be taxed after the expiration of six months.

"The taxing officer of either House is enabled to tax the whole of a bill brought before him for taxation, whether the costs relate to the proceedings of that House only, or to the proceedings of both Houses; and also other general costs incurred in reference to the private bill or petition. And each taxing officer may request the other, or the proper officer of any other Court, to assist him in taxing any portion of a bill of costs. And the proper officers of other Courts may, in the same manner, request their assistance in the taxation of parliamentary costs.

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"The last matter which need be mentioned in connexion with the passing of private bills, is the taxation of the costs incurred by the promoters, opponents, and other parties. Prior to 1825 no provision had been made by either In the Commons the taxing officer reports House, as in other Courts, for the taxation of costs incurred by suitors in Parliament. In his taxation to the Speaker, and in the Lords 1825 an Act was passed to establish such a to the Clerk of the Parliaments. If no objectaxation in the Commons; and in 1827 an- tion be made within 21 days, either party may other Act was passed, to effect the same object obtain from the Speaker or Clerk of the Parliaments, as the case may be, a certificate of the

1 Table of Fees.

"See Report, 25th July, 1850; 105 Com. J. 563. In 1604 counsel was assigned to a party, in a private bill, in formá pauperis, he 1 Com. J. 241. being a very poor man.' 384 Com. J. 90. 46 Geo. 4, c. 69.

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