This cause was heard by Greene, C.J., sitting alone in Chambers, and the opinion was delivered by him. The plaintiff advanced to the defendants for the purposes of the joint undertaking, $3,343 in money, and $1,064.79 in outfits.
The defendants, with James M. Livesey, and John Livesey, Whitehead and Chadwick, all arrived in California, their expenses having been defrayed out of the money advanced by the plaintiff.
In the course of the voyage, some difficulty appears to have arisen between the defendants and James M. Livesey.
On the 29th of January, 1850, after their arrival at San Francisco, the defendant, Moses, addressed a letter to the plaintiff in which he complains of the conduct of James M. Livesey, and says, "I think you had better send out a power of attorney, and we will dissolve with him, or he may give us some trouble." In the same letter, he says, "I think they (meaning Livesey and the Captain of the brig in which they took passage from Panama) and the Dutchman will go to the mines together."
On the 9th of February following, he addressed another letter to the plaintiff, in which, after speaking of Livesey's conduct in keeping away from them, and doing all he could to injure them, he says, "I would not go to the mines with him for all the gold there is in them."
Livesey never did go to the mines with the defendants, but left them and withdrew entirely from the business of the company.
It appears, therefore, that the defendants, so far from *Page 439 considering Livesey's withdrawal from the company as any ground of dissolution, as between the plaintiff and defendants, were anxious to exclude him, considering the business of the company could be more successfully prosecuted without him than with him. And these letters are notice to him that they should continue to prosecute the joint undertaking, notwithstanding Livesey had left them.
In the same letter, the defendant, Moses, informs the plaintiff that he had seen Chadwick and Whitehead, and endeavored to persuade them to go to the mines according to their contract, but they refused. But there is no intimation in the letter that their refusal would be considered as a ground for dissolving the partnership, and breaking up the joint undertaking, or even that it would impede its successful prosecution.
In the same letter he states that John Livesey would go to the mines with them.
It does not appear from the answer, or any evidence in the cause, whether Chadwick and Whitehead, or John Livesey went to the mines. The answer states that the said defendants, after a short stay in San Francisco, started for the mines, and arrived at Ousley's Bar about the 20th of February, 1850. That they earned and acquired at said Bar, gold to the amount of about two hundred and twelve dollars, up to the 24th of March, 1850. That on or before that day, both the Livesey's, Whitehead and Chadwick, left and deserted the defendants, without their license or permission, and refused to work for and with them.
The statement in the answer is very ambiguous as to the time when they left, but taken in connection with the letters, I should infer that John Livesey was the only one *Page 440 who went to the mines with the defendants, and that he left about the 24th of March, 1850.
The answer states that on the 4th of July, 1850, James M. Livesey died.
The defendants remained in California until August, 1850, when they embarked for the United States; and, after their arrival in Providence, they deposited the sum of $2,700 to their individual credit in the State Bank.
The defendants allege in their answer, that this money is the individual property of the defendants, and not company property; and this is the main question in the cause.
The counsel for the defendants have contended that the copartnership between the plaintiff and the defendants and Livesey, was dissolved by the refusal of Chadwick, Whitehead and John Livesey, to work at mining for the company, in compliance with their agreement; that in point of fact mining in California cannot be carried on by two persons only, and all the others having deserted, the partnership ceased because its business could no longer be carried on.
I do not think Chadwick, Whitehead and John Livesey, under their agreement with the company, became copartners therein. The receipt of a portion of the profits might render them partners as regards creditors, but as between themselves and the company who employed them, they were hired as servants to work for the company, to receive their compensation in a certain part of the profits, instead of a stipulated rate of wages.
Nor do I consider the desertion of these men as any reason for the defendants to treat the copartnership as dissolved, if the defendants could work advantageously without them, or if they could hire others to assist them. *Page 441 It would be unreasonable to suppose the parties intended the prosecution of the undertaking should depend entirely upon the fidelity of these three men, although others might be employed in their stead, more especially when it was known how apt men so employed were to desert their employers on their arrival in California.
It may be doubtful whether the defendants were authorized to hire men to work at the mines at the stipulated price, and thus pledge the credit of the firm for the payment of wages; but they were authorized to employ other men paying them in profits, that being the mode of payment provided for in the agreement with Chadwick and the other two. The defendants do not allege in their answer they could not work advantageously without other hands to help them, or that other hands could not be procured, nor have they offered any proof to that effect, and I cannot assume either of these alternatives to be true, in the absence of all evidence.
In fact, there is evidence in the cause to the contrary. James F. Eddy states in his affidavit, the defendant, Moses, told him they employed ten men in mining on their, the the defendants, account.
But laying this evidence out of the case, we think the fact relied on by the defendants as working a dissolution of the copartnership must be proved, and, as already stated, they have offered no evidence to prove it, and do not even allege it in their answer. Besides, if the defendants intended to dissolve the partnership on this account, it was their duty to have given prompt notice thereof to the plaintiff, and to have treated the company property as if the partnership were dissolved.
They give no notice to the plaintiff, and take no steps to wind up the company affairs, but retain in their hands *Page 442 all the company profits and use them for aught that appears, as if the copartnership had continued, and render no account of them.
There is another difficulty in this part of the defence. The fact that the prosecution of the company business had become impossible, does not of itself dissolve the copartnership. It may be a sufficient ground for a Court of Equity to decree a dissolution, but until such a decree, the partnership remains.
Another ground relied on by the defendants for a dissolution of the copartnership, is the death of James M. Livesey.
As a general rule of law, there can be no doubt the death of a partner dissolves the copartnership. But in this case, Livesey had withdrawn from the firm, not only without objection by the defendants, but with their approval. He had taken with him, in money and tools, a large amount belonging to the company, without having contributed anything to the capital of the company, and had therefore no interest in the partnership funds at the time of his withdrawal and death. He was a debtor to the firm. He could not claim any portion of the profit of the partnership accruing after such withdrawal. In fact, we consider that event under the circumstances, a dissolution of the partnership so far as Livesey was concerned. His subsequent death, therefore, can have no effect upon the partnership existing between the plaintiff and the defendant.
There is another difficulty in this ground of defence. The defendants gave the plaintiff no notice of Livesey's death, and took no steps to wind up the company concerns, but, on the contrary, retained in their hands all the *Page 443 company property and employed it as they pleased, without rendering to the plaintiff any account thereof.
The defendants also contended, that by the agreement, the copartnership was to continue for no definite period, and, therefore, either party might dissolve it at his will.
By the articles of copartnership, the parties agree to engage in a mining and trading expedition to California, as copartners. I think this means that the parties engage to each other for at least one mining season. If the construction contended for by the defendants should be adopted, the moment the partners arrived at the mines, (their expenses having been, as in this case, paid by the partner at home,) any one of them at his will, might dissolve the copartnership, and thus absolve himself and his companions from all obligations to the partner at home.
But, however this may be, the agreement with the three men employed exclusively to work at mining, provides that they shall work for one year from the time of their arrival in California. As they were to mine for the copartnership during this period, I think the necessary inference is, that the copartnership was to continue during the same period.
After a careful examination of the subject, I have come to the conclusion that this copartnership was not dissolved by any of the causes which have been assigned by the defendants, so far as the plaintiff and defendants are concerned.
While the partnership subsisted, the skill and labor of the defendants constituted a part of its capital stock, as much as the money and outfits furnished by the plaintiff; and the defendants had no right to apply this skill and labor to mining and trading, or to any other business on *Page 444 their private account. This would be a violation of their obligations to the firm, and all profits acquired by such unlawful means, are in contemplation of law, copartnership profits.
In this view of the law, it is quite immaterial whether the defendants engaged in mining or trading, or any other business on their private account during the existence of the partnership; in either alternative, the profits are equally partnership property.
The main question in the cause is then narrowed down to this: Did the defendants acquire the money which is sought to be enjoined, by their skill and labor, or by the employment of the company property in mining, or trading, or any other kind of business on company or private account during the existence of the firm?
It is not pretended the defendants had any money or property when they sailed for California, except what was furnished by the plaintiff. It seems they had no credit, for the plaintiff was obliged to pay a debt, which they owed another firm, before they were permitted to leave the State.
They arrived at the mines on the 20th of February, 1850, as stated in their answer. On the 24th of March following, they were at the mines engaged in mining with the implements, tools and appliances for mining and other company property in their possession.
They admit they had earned at that time by digging, two hundred and twelve dollars.
From the affidavit of James F. Eddy, it appears they subsequently employed ten men in mining on their private account. And when they left the mines, they sold the provisions they had on hand, for nearly five hundred dollars. On their passage from New York to Providence, *Page 445 in reply to a question from John D. Craven, how they made out in California, they stated better than they expected. In their answer, they gave no account of the company property on hand on the 24th of March, 1850, when they claim the copartnership was dissolved, nor of what disposition or use they made thereafter of this property, nor in what employment they were engaged thereafter. Neither do they give any account of the manner in which they acquired the property which is the subject of the present suit.
In the absence of all account from the defendants, I feel myself bound to say, that the evidence put in on the part of the plaintiffs satisfies my mind, that this property is copartnership property, and was acquired by the defendants by their skill and labor in mining, or trading, or both, with the company property, during the existence of the copartnership.
Upon this view of the facts, the property belongs to the copartnership; and the defendants having attempted to convert it to their own private use, and having denied the title of the copartnership thereto, I feel it my duty to withdraw the property from their control by granting the injunction prayed for and the appointment of a receiver. *Page 446