MUTHUSWAMI NADAN Vs. AAKSANKARALINGAM CHETTY

JUDGEMENT

(1.) The only question for decision in this appeal is, whether the acknowledgment of liability by the 1st defendant on 27th May 1909 is binding on the 2nd defendant. The original liability was admittedly incurred on account of a partnership between the 1st and the 2nd defendants; but this partnership had ceased in 1906. It has been held in two cases in this Court, Valasubramania Pillai v. Ramanathan Chettiar 2 Ind. Cas. 309 : 32 M. 421 : 5 M.L.T. 105 : and Sheik Mohideen Sahib v. Official Assignee of Madras 11 Ind. Cas. 332 : 35 M. 142 : (1911) 1 M.W.N. 347 : 9 M.L.T. 473 that a part-payment or acknowledgment by one partner of a going concern will not bind another partner (so as to save limitation) in the absence of evidence of authorisation. Mere proof of the partnership would not be sufficient. In a more recent case, K.B.V. Firm v. Sathayavada Sitharama Swami 21 Ind. Cas. 634 : 37 M. 146 : 25 M.L.J. 501 Wallis, J., expresses doubts of the correctness of these rulings, and appears to hold that authorisation might be presumed from the ordinary course of partnership business. But, however this may be, such a presumption could hardly be drawn in the case of an acknowledgment made after the dissolution of partnership. In such a case, it seems to us clear that express evidence of authority must be forthcoming, if the acknowledgment is to be held binding on any ex-partner, except the one who made it. The presumption which Wallis, J., would draw in the case of existing partnerships could not be applied to a case like the present.

(2.) It was argued before us that such evidence was forthcoming in the deposition of the 2nd defendant himself. This runs as follows: After we separated, I did not authorise the 1st defendant to sign promissory notes for settlement of accounts on behalf of me also

(3.) Cross-examination: The 1st defendant said that the assets and liabilities could not be divided then and there, that he would himself collect outstandings and pay off liabilities and that we may divide the balance. I agreed to this.... Re-examination: I then allowed the 1st defendant to collect outstandings and pay off creditors but did not authorise him to renew liabilities.