466 SIMPSON V. CHAPMAN 4 DE G. M. & a. 154.

speak to their having seen him at different intervals after that event, and one of
whom states that the father told him that he had been on a cruise on the coast of
France, without any mention of the period when he went or when he returned.
Under these circumstances I am fully satisfied that this sentence of nullity was not
obtained bond fide, but is affected by fraud and collusion, and cannot be received as
conclusive evidence of the invalidity of this marriage.
It then remains only to consider the question upon the whole of the evidence
before us, and in this view of the case I think that having regard to the general rule
which applies to all cases of presumption " omnia rite" acta presumuntur," and to the
particular force of that rule as applied to cases of presumptions in favour of marriage
and legitimacy, and against the commission of any crime or offence ; and, having
regard also to the cases which were cited in the argument, we are bound in this case
to presume that the father was consenting to the marriage, and that it was therefore
valid. The circumstance of the marriage being expressed upon the face of the
register to be with the consent of the mother, was relied upon against this presump-
tion, but I think it more than probable that the mother's consent was entered upon
the register in consequence of her having been present at the marriage, and, at all
events, the fact of her consent having been given would not, I think, be sufficient to
countervail the presumption that the father was consenting also.
I concur, therefore, in the order which my learned brother has proposed.

[154] SIMPSON V. CHAPMAN. Before the Lords Justices. June 22, 23, 1853.

[S. C. 20 L. J. Ch. 8 8 ; 15 Jur. 714. See Wedclerburn v. WedderUrn, 1856, 22 Beav.

117. Questioned, Macdonald v. Bichardswi, 1858, 1 Giff. 81. See Fyse v. Foster,
1872, L. R 8 Ch. 317 n.]

A testator was a member of a partnership at will in a bank, without any provision

entitling the executor of a deceased partner to an interest in the goodwill of the
concern. The credit, in which the bank was, rendered capital unnecessary, and
at the testator's death the property of the concern exceeded its liabilities by a very
small amount, the testator's share in which was far exceeded by the balance due
from him to the bank on his private account, as a customer. After his death the
surviving partners admitted into the firm his son, who was his executor, but who
was not admitted into the firm in that character, and the business continued to be
carried on without any separation or appropriation of the partnership assets as they
existed at the testator's death. In a suit against the executor for the adminis-
tration of the testator's estate : Held, that he was not accountable to the testator's
estate for the profits which he had received as a partner in the bank.

These were two appeals from a portion of a decree of Vice-Chancellor Stuart in

a suit for administering the assets of a testator named Thomas Simpson, who for
some years previously to, and at the time of his death, carried on the business of a
banker at Whitby, in co-partnership with John Chapman, one of the Defendants, and
Abel Chapman, under the firm of Simpson, Chapman, & Co. The partnership was
one at will and had subsisted for several years, but without any articles, the profits
being equally divided between the partners, and there being no stipulation as to the
share of a deceased partner in the goodwill of the concern.
By his will dated the 20th of April 1843, the testator gave all his residuary
personal estate (which included whatever interest he had in the bank) to the
Defendants John Chapman, Henry Simpson, and Thomas Brodrick Simpson, in trust
for his sons the Defendants, Henry Simpson, Thomas Brodrick Simpson, and the
Plaintiff George Simpson, in equal shares absolutely, and the testator appointed
John Chapman, Henry Simpson, and Thomas Brodrick Simpson, executors in trust
of his will. The testator died on"the 26th of May 1843.
Thomas Brodrick Simpson did not take an active part [155] in the executorship,
but left the administration of the testator's estate to the Defendants, John Chapman
and Henry Simpson.
The bill contained the following charges : —

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4DEG.M.&G.156. SIMPSON V. CHAPMAN 467
That each of the partners in the bank, viz., the testator and Abel Chapman and
John Chapman had private current accounts with the firm, in respect of which
various sums were from time to time standing to their credit or debit as the case
might be, and in respect of which they were treated and considered as ordinary
customers of the bank.
That each of the partners was entitled to one-third of the assets of the partner-
ship, and liable to the payment of one-third of the liabilities thereof, and that, except
such interest in the assets of the bank, neither of the partners had any capital
therein.
That the value of the assets of the partnership at the testator's death and for
some time previously thereto exceeded the amount of all its liabilities by a com-
paratively small amount, and that, in fact, as the bank was from the well-known
wealth of its partners in good credit, it was unnecessary that the partners should
retain therein any considerable surplus of assets above its liabilities.
That the bank was a bank of issue as well as of deposit, and that the profits of
the partnership arose from the employment at interest by way of loans to customers
on overdrawn accounts and otherwise, and investment, in other modes, of monies
placed in their hands by way of deposit, and of the amount of their notes in
circulation.
That since the death of the testator the Defendant [156] Henry Simpson had
assumed to be and had acted as if he had been a partner in the banking business with
John Chapman and Abel Chapman in the place of the testator.
That there was at the time of the testator's death a considerable sum of money
in the banking-house in cash and Bank of England notes, and that since the testator's
death various monies had been received and paid in cash and Bank of England notes
in respect of bills of exchange and notes of other bankers, which were the property
of the partnership at the time of the testator's death, and in respect of the principal
and interest of debts due to the partnership at the time of the testator's death and
otherwise.
That there had also since the testator's death been received at the banking-house
of the said co-partnership various sums of money in cash and Bank of England notes
from creditors of the bank at the time of such payments, and by persons who had
become customers thereof since his decease.
That the cash and Bank of England notes which were in the banking-house at the
time of the testator's decease were not in any way set apart or appropriated for the
payment of the debts and liabilities of the partnership at the time of his death, but
remained in the till or depositories of the said banking-house, and that there were
added thereto and mixed therewith the cash and Bank of England notes which were
in the course of business received at the banking-house after the testator's death ;
and that, in fact, all the cash and Bank of England notes received at the banking-
house since the testator's decease had been mixed together in the till or other
depositories of the banking-house without any distinction.
[157] That the several cheques which had been drawn on the said bank since the
testator's death had been paid out of such mixed fund, except so far as they had been
paid by notes of the partnership.
That such cheques had been paid indiscriminately out of the above-mentioned
mixed fund, whether they were cheques on accounts or for sums in respect of which
the said co-partnership was indebted in the lifetime of the testator, or were drawn by
persons whose accounts with the said co-partnership were overdrawn at the time of
drawing such cheques, or by new customers of the bank, or otherwise by way of
advance, and not in payment of any liability of the said partnership in the testator's
lifetime.
That in fact the monies which had been repaid, and which were still due in
respect of principal and interest of overdrawn accounts and advances, were to some
extent the fruits of the cash and Bank of England notes the property of the partner-
ship at the time of the testator's death, and received in respect of the debts owing
to and other assets of the said co-partnership in the testator's lifetime.
That the various cheques drawn upon the partnership since the testator's death
had been, so far as the persons presenting the same were willing to accept payment
in that manner, paid partly by notes of the partnership which were in the banking-

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468 SIMPSON V. CHAPMAN 4 DE G. M. & G. 168.

house at the time of the testator's death, and partly by the re-issue of notes of the
partnership issued in his lifetime, which had been paid into the banking-house since
his decease.
That such cheques had been so paid indiscriminately, whether they were drawn
on accounts or in respect of sums for which the partnership was liable at the time of
[158] the testator's death, or on accounts which were at the time of payment of such
cheques overdrawn, or for new customers, or otherwise by way of advance.
That the monies which had been repaid and were now due to the existing partner-
ship in respect of accounts overdrawn since the testator's death, and in respect of
advances made since his death, were to some extent the fruits of the balance of the
partnership in the hands of their London agents or bankers at the time of his death.
That money which was received in respect of certain Whitby and Pickering Rail-
way shares and bonds, which were part of the property of the co-partnership at the
testator's death, was paid into the banking-house of the co-partnership, and mixed
with the other monies, and applied to the general purposes,of the bank.
That several of the debts due to the said co-partnership at the time of the
testator's decease remained unsatisfied, and part of the property of the partnership
at the time of his decease remained unrealized, and that several of the debts due
from the said co-partnership at the time of the testator's death were unpaid, and that
a large quantity of the notes issued by the said co-partnership in the testator's life-
time still remained outstanding.
That such of the debts due and owing to the said partnership at the testator's
death, as had been paid, had been paid from time to time and many of them at an
interval of some years from the testator's death, and that such of the debts due from
the partnership at the time of the testator's death as had been paid and discharged
had been so paid and discharged at considerable intervals of time after the testator's
death.
[159] That the several debts due to the partnership at the testator's death, and
the several advances which had been made since his death on current accounts and
otherwise, had carried interest at the rate of £ 5 per cent, per annum, or some other
high rate of interest, whilst the debts due and owing from the partnership either
carried no interest or only a small rate of interest.
That by such difference in the rate of interest, considerable profits had arisen
since the death of the testator, and that the Defendant Henry Simpson had received
and claimed to be entitled to receive and retain* for his own use one-third of such
profits from the testator's death, in the same manner in all respects as the testator
would have been entitled to have done if he had been alive.
That, with the exception of the said Henry Simpson assuming to be substituted
for the testator as. the person entitled to receive the one-third of the profits, the
business has been carried on since the testator's death, in the same manner in every
respect as if he were living.
That Abel Chapman was from a period antecedent to the testator's death, and
had since continued, and still was imbecile by reason of age, and incapable of enter-
ing into any contract or transacting any matter of business; and that the alleged
admission of the said Henry Simpson as a partner, and all the acts which had been
done with reference to the banking business since the death of the testator, had been
the acts of Henry Simpson and John Chapman only.
That the Plaintiff sought no relief against Abel Chapman and John Chapman in
respect of the one-third of the profits which they had respectively received on their
[160] own account, and which in any event they were so entitled to receive, but the
Plaintiff charged that Henry Simpson and John Chapman as executors of the testator
were liable to account for the one-third which had been received by or credited to
Henry Simpson of the profits which have arisen from the carrying on the business
since the testator's death, so far at all events as such profits had arisen from the
testator's credit on the notes and liabilities of the partnership, from the interest of
debts due to the said co-partnership in the testator's lifetime, from the interest on
advances made on overdrawn accounts or otherwise, with monies which had arisen
and been produced from the assets of the partnership in the testator's lifetime, or
with the notes of the partnership signed in the testator's name thereon, and from the
outstanding liabilities of the partnership in the testator's lifetime.

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4DEG.M.&G.161. SIMPSON V. CHAPMAN 469

That in fact no profit had arisen to the said business from any other source than
as aforesaid.
That if any part of the profits of the said banking business had arisen from any
other source, and the amount thereof could not be distinguished and separated, the
testator's estate ought to be credited with the whole amount which had been paid or
credited to Henry Simpson in respect of the one-third of the profits of the business ;
and that the Plaintiff was entitled to have the partnership wound up on the principle
that one-third of the assets thereof belonged to the testator's estate.
The prayer was for an account of the residuary real and personal estate of the
testator, and the proceeds thereof possessed or received by or come to the hands of
the Defendants, and that the share therein of the Plaintiff might be ascertained and
paid to him; [161] and that in taking such accounts the Defendants Henry Simpson
and John Chapman might be charged in respect of the share of the profits of the
said banking business, carried on since the testator's death, paid or credited to Henry
Simpson and otherwise in respect of the said banking business.
It was agreed at the Bar that, at the testator's death, the bank property was
worth ,£ 177,000, and that the firm owed debts to the amount of £ 165,000, leaving
a balance in their favour of £ 12,000, and that the testator at his death owed the
concern £ 14,000; so that if it had been wound up he would have paid £ 10,000 and
received nothing.
By the decree appealed from, the Vice-Chancellor directed an inquiry whether
the Defendant Henry Simpson ever brought any capital into the banking business
in the pleadings mentioned, except the assets of the testator, and it was declared
that in taking the accounts, the Defendants John Chapman and Henry Simpson were
to be charged in respect of the profits of the bank from the death of the testator,
paid or carried to the credit of the Defendant Henry Simpson, so far as such profits
had accrued from the assets of the testator employed in the partnership.
From this portion of the decree, both the Plaintiffs and Defendants appealed, the
Plaintiffs on the ground that it should be extended and made more adverse to the
other Appellants who, on their part, insisted that it should be wholly omitted, and
that nothing should be substituted for it.
Mr. Bacon, and Mr. Faber, for the Defendants.
In point of fact there was nothing that could be called [162] capital in the
business. The business was carried on by means of the deposits of customers, by
continuing transactions, previously entered upon, and at the testator's death there
were no assets whatever of his in the firm.
The Plaintiff's case was before the Vice-Chancellor attempted to be supported by
the authority of Grawshay v. Collins (15 Ves. 218; 1 Jac. & W. 267); but in that
case there was capital of the bankrupt employed, whereas it is stated on this bill,
and admitted, that there was no capital of the testator in the concern, and the good-
will is the only property which is contended to have remained of the testator in the
concern after his death. The argument is that this goodwill continued, although
there was no stipulation to that effect, because the doors of the banking-house were
not closed, and the business entirely put an end to. On this ground it is argued
that the testator's estate ought to have one-third of the profits exactly as he would
have had if he had been alive. In 1843, £ 177,286, 6s. was the amount of the assets
(sundries debtor to stock). On the other side the debts and liabilities (that is to say
stock debtor to sundries) are £ 174,000. The partnership at the testator's death
(with the full assent of the residuary legatee, the Plaintiff and Thomas B. Simpson,
the other executor) carried to the credit of an account opened by the executors with
them the sum which stood to the testator's credit in the books. That sum and every
other sum received on account of his estate has been carried to the credit of the
testator's account, and the pass-book has gone from hand to hand from time to time*,
and every shilling available for the testator's estate has been accounted for. That
course of dealing lasted from 1843 to 1849, a period of six or seven years;
[163] In these circumstances it was wholly premature and wrong to declare that
in taking their accounts the executors were to be charged with the profits so far as
the profits have accrued from the assets of the testator employed in the business. If
it could be right at all (which we submit it is not), it was wrong, at all events, to
make any declaration till previous inquiries were made.

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470 SIMPSON V. CHAPMAN 4DEO.M.& 0.164.

Mr. Malins, and Mr. J. V. Prior, for the Plaintiffs.

The particular grounds on which we claim a share of the profits are these. First
with reference to the difference of interest. Suppose there was no balance in favour
of the bank, but that there was £ 160,000 owing to the concern, and £ 160,000 owing
from it, still the monies due to the partnership bore five per cent, interest, whereas
the monies owing from the partnership, bore a much smaller rate. The consequence
is, as appears by the answer, that the interest received has been £ 9600, the interest
paid has been little more than £ 7000, leaving a balance of £ 2300, which has been the
profit arising from the non-liquidation of these debts nearly balancing each other at
the time of the testator's death. The delay of the customers in forbearing to call in
their money has been a saving of interest, while those who owed money have paid
interest. The right to participate in that amount seems given by the answer. The
next thing is a balance of £ 4000 which was in actual cash in the banking-house at
the time of the testator's death. As to that, and as to all the other items, the
Defendants say that they paid the debts and liabilities with the assets in the ordinary
course, and that they did not use the assets except during the intervals that the
debts and liabilities were not called for, and that as there was a certain sum of money
in which the testator's estate was interested to the extent of one-third, there was an
equi-[164]-valent sum to pay. We say, however, that the testator's estate was
entitled to one-third of this benefit, and to the use of these monies during that
interval of time. The circumstance of there having been a debt that was to be paid
at some future time, did not make this property less assets in which the testator's
estate was interested, nor did it make the profits less part of his estate. Mr. Abel
Chapman and Mr. John Chapman have only claimed two-thirds of these profits.
Each has taken one-third, and they have allowed Henry Simpson to take one-third
for his use. But what Henry Simpson received with the permission of his partners,
he received as profits derived from the employment of the testator's assets. He
could not take it for his own benefit, he could only take it as part of the testator's
estate. If there had been a settlement upon the testator's death, Henry Simpson
must have brought in fresh money, and the testator's estate would have been relieved
from the liability of that five per cent, interest with which his account was chargeable.
The five per cent, interest on the debt due from the testator to the bank, was part of
the profits of the bank, which Henry Simpson actually took as part of those profits.
With regard to the balance lying with the London bankers, nothing could have been
more easy than to have written to the London bankers and said that £ 1800 must be
carried to a separate account, and that cheques should be drawn against that amount
separately, and that £ 1000 should be sent to go on with for the new partnership, so
that the cheques, and bills, and orders in respect of the liabilities of the old partner-
ship would be drawn on one account, and the bills and orders for the purposes of the
new firm on the other account. But then Henry Simpson must have found his one-
third of that sum which would have been thus remitted to the London correspondents
to keep the concern going, and to enable them to provide the [165] money which
was wanted for the new partnership. Therefore it comes to this, that Henry Simpson
has avoided the necessity of contributing to the current capital, which, according to
the new establishment of the bank, must have been found to start with. He has
avoided the necessity of bringing in that capital, and has taken the benefit of the
testator's money, and, by the employment of it, made a profit. So with the notes of
the old firm which were re-issued. We admit that the testator's estate might not
have been bound by them, and that, ordinarily speaking, they ought to have been
destroyed; but if the executors have managed so as to give those pieces of paper a
value, by lending, them as money, and received ^ve per cent, interest upon them, one-
third of this has been obtained by the use of the testator's name. The executor
could not retain that one-third which he had made by the use of documents which
ought not to have been used at all, and which really were of no value. These are
the grounds on which we say that as between the testator's estate and the executor,
the Plaintiff is entitled to have accounted for as part of the estate at least such
profits as have arisen from the testator's credit on notes and liabilities of the partner-
ship and from the interest of the debts due to the partnership in the testator's life-
time. But if it is impossible to ascertain how much profit has been introduced from
these sources, then the executor is not entitled to the benefit of his own default, and

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 DE 0. M. & 0.166. SIMPSON V. C H A P M A N 471

of the inaccurate mode of keeping his accounts, but the testator's estate must be
entitled to the whole benefit. The Defendants by their answer say it is utterly
impossible to make the distinction. They say, " How much of the cash of the
banking-house at the time of the testator's death was employed in paying the partner-
ship debts, how much was employed in making advances and interest to other
persons, we know not; we have no document to shew-how many notes were [166]
issued after his death. We have no means of telling." In fact the allegation is
generally that the accounts have been kept in such a way that it is impossible to
make any distinction of that sort whatever.
[ T H E LORD JUSTICE TURNER. Has the rule ever been adopted of charging
partners on the same principle on which an executor is charged ? His Lordship
referred to Wedderbum v. Wedderbum (4 Myl. & Cr. 41).]
In that case, there were other partners all of whom received the profits jointly,
whether executors or n o t ; but there the share of the profits, which we say belonged
to the testator's estate, was received by an executor alone, and by an executor who
was not a partner of the testator in his lifetime, but who came in after the testator's
death, and took not merely the goodwill of the business, which possibly the surviving
partners might have given him, but also that which they have not the power to give
him, namely, a portion of the testator's property in the concern.
T H E LORD JUSTICE KNIGHT BRUCE. The appeals in this case relate only to a
small portion of the decree, to these words, namely, " a n inquiry whether the
Defendant Henry Simpson ever brought any capital into the banking business in
the pleadings mentioned, except the assets of the said testator; and the Court
declares that, in taking the accounts hereinbefore directed, the Defendants John
Chapman and Henry Simpson are to be charged in respect of the profits of the said
bank from the death of the testator, paid or carried to the credit of the Defendant
Henry Simpson, so far as such profits have accrued from the assets of the said testator
employed in the banking partnership."
[167] This passage, it is contended by the Plaintiff, should be extended and made
more adverse to the other Appellants, who, on their part, insist that it should be
wholly omitted, and that nothing should be substituted for it.
It is in the first place to be borne in mind that the Plaintiff has so constructed his
suit as to preclude him from obtaining a partnership account in the cause, for which
the absence from the record of Mr. Abel Chapman (who never was a party), and the
circumstance that his estate is not represented before us, are alone a sufficient reason,
if there were no other ground. That omission is not through any wish or neglect on
the part of any of the Defendants.
The question whether the case is brought within the principles on which Craw-
shay v. Collins (15 Ves. 218; 1 Jac. & W. 267), and other authorities of that class
proceeded may be a very different question.
To the proper consideration, however, of this latter point, it is essential that we
should determine whether the partnership formed between Mr. Abel Chapman, the
Defendant Mr. John Chapman, and the Defendant Mr. Henry Simpson owed its
origin or had reference to Mr. Henry Simpson's character of one of the testator's
executors. And the evidence, I think, renders it necessary to decide this particular
question against the Plaintiff; nor was it, I conceive, as one of the residuary legatees
that Mr. Henry Simpson became a partner.
I collect that he became a partner as he did, merely and simply on his own
account. Still he may have employed or concurred in employing assets of his father
[168] in the business in such a manner as to constitute or amount to a breach of
trust. Is it established that he did*? In my opinion not. The partnership of which
the testator was a member ended at his death. His partners were entitled not to
close the business upon the happening of that event—were entitled to act thenceforth
as bankers in partnership together on their own account, without or with any fresh
partner.
The bulk, the chief part, of the capital belonging, at the testator's death, to the
partnership of which he was a member, consisted of debts due to it from various
customers, and from its London agents, and the cash in the banking-house at Whitby,
for the supply of its daily purposes in the ordinary way, including notes of the
partnership, payable to bearer on demand, intended for circulation and used as cash;

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while, on the other hand, it owed at that time, in the way of business, debts, to such
an amount as that, in truth, though each of the partners was probably then a
wealthy man and very deservedly in good credit, the partnership itself was insolvent,
that is to say, the debts due from it exceeded its assets at that time. This, however,
is on the footing of treating as not existing, or as a bad debt, a sum of £ 14,000 or
XI 5,000 due at the testator's death from him on his private account to the partner-
ship. Treating that as paid after his death, by his private estate, his executors
would in that character have to receive back part, but not the greater part of it.
The greater part would belong to his two partners, who (as the surviving partners),
being liable personally for the debts due from the dissolved partnership, were
entitled to apply its assets towards the discharge of those debts. Doubtless the debts
on each side, or many of them, were, after as well as before the testator's death, in a
state of continual or frequent fluctuation; customers paying in money [169] and
drawing out money, borrowing at interest, and depositing at interest, diminishing or
paying off loans, withdrawing or diminishing deposits. The building and offices
where the business was carried on formed part of the testator's real estate, and was
devised by him to the Defendant Henry Simpson.
Such a state of things, without more special circumstances than I see here, seems
to me an insufficient ground for the direction and declaration that these appeals
relate t o ; particularly where, as in the present instance, there has been considerable
delay in bringing forward the claim. With the knowledge that the Plaintiff must
have had, it was incumbent on him to make the demand earlier, even had his case
not been so slender and shadowy as it is. Something was said of the common bank
notes of the dissolved firm having been re-issued by the new firm after the testator's
death. This, however, I cannot hold to be material for any present purpose. The
ordinary accounts of the testator's personal estate the Plaintiff is entitled to and has
obtained. He will have (if he has not had) his due share of its clear residue, not
subjected to any amount or proportion of debt which it ought not to bear. No part
of the bill has been or now is dismissed. But I am (I repeat) for omitting the disputed
words, and substituting nothing for them.
It appears to me, that our order should be made on both petitions of appeal, that
the Plaintiff should pay the costs of his, and that the other Appellants should take
back their deposit.
T H E LORD JUSTICE TURNER. This case involves, or may involve, questions of
very great importance : questions as to what is to be consi-[170]-dered as capital of
an outgoing partner with reference to a banking concern, in a case in which, in the
ordinary sense of the word "capital," there was in truth no capital at all. It is
not necessary, as it appears to me, to give a decision on any of these questions, and
certainly they are not questions into which the Court would be inclined unnecessarily
to enter.
There are two appeals in the present case; one presented by the Plaintiff,
complaining in substance of that part of the decree which gives him only the profits,
of the bank, from the death of the testator, so far as such profits have accrued from
the assets of the testator employed in the banking partnership, the Plaintiff insisting
that he is entitled to an unqualified account of the profits derived from the bank, so-
far as they have been received by the testator's executors. The other appeal is by
the Defendants, the executors insisting, that all the inquiries relating to the profits
of the bank ought to be struck out of the decree.
The first question which it appears to me to be material to consider, is whether
the Plaintiff can succeed in his appeal, claiming the right to all the profits of the
bank, without reference to the qualification which is introduced into this decree,
" so far as such profits have accrued from the assets of the testator employed in the
banking partnership." The object of the Plaintiff of course is to charge Henry
Simpson, the executor of the testator, with the whole amount of the one-third of the
profits of this banking business received by him from the year 1843, when the testator
died, down to the present time. To give the Plaintiff that relief, would be to assume
that all the profits which had been received by Henry Simpson are profits derived
from the testator's capital, and, in my [171] opinion, it is impossible, under the
circumstances of this case, for the Court to make any such assumption. The business
here carried on is the business of the bank. The capital with which the Plaintiff

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4DEG.M.&G.172. SIMPSON V. CHAPMAN 473
contends that business to have been carried on consists of money deposited with the
firm in which the testator was a partner. But from the nature of the banking
business, these monies must, in the period from the death of the testator to the
present time, have been from time to time turned over. The old loans which have
been made by old customers with the old firm, must, from the nature of the banking
business, have been paid off, and new deposits and new loans made by the customers
to the new firm in which Henry Simpson was a partner. From the nature of the
business, therefore, it is impossible, I think, to arrive at the assumption that all the
profits which have been derived by this bank from the death of the testator down
to the present time, were derived from the capital of the testator. Consequently,
I think that the Plaintiff cannot succeed in his appeal, which claims the whole of
these profits.
I desire on the present occasion to express very distinctly my entire concurrence
in the opinion expressed by Vice-Chancellor Wigram in the case of JVillettv. Blandford
(1 Hare, 253), in which he has made, I think, a most correct and masterly summary
of the principles by which the Court is to be guided in cases of this description. He
says (1 Hare, 272), that the profits derived from the trade carried on after the death
of the testator must depend upon the nature of the trade, the manner of carrying it
on, the capital employed, the state of the account between the partnership and the
deceased partner at the time of his death, and the conduct of the parties after his
death. That all these [172] may materially affect the rights of the parties. I fully
adopt this view, and, applying it to the present case, I venture to say that it depends
on the nature of this trade, on the capital employed from time to time in it, on the
conduct of the parties, on the extent of the skill and industry of each partner
employed in the concern, to what extent the profits derived from the trade ought
to be attributed to the capital, and to what extent they ought to be attributed to
other sources; and that, under the circumstances of this case, it would be going
much too far to hold that the Plaintiff ought to succeed in the claim which he makes
for the whole of the profits derived from the testator's third of this concern. My
opinion therefore is, that the Plaintiff's appeal must be dismissed with costs.
We come then to the question, how, if the Plaintiff cannot succeed in his appeal,
is this decree to be worked1? The Court declares " t h a t in taking the accounts herein-
before directed, the Defendants John Chapman and Henry Simpson are to be charged
in respect of the profits of the bank from the death of the testator, paid or carried to
the credit of the Defendant Henry Simpson, so far as such profits have accrued from
the assets of the said testator;" but the decree contains no direction and no declara-
tion by which it can be ascertained how far the profits are to be considered as
having accrued from the assets of the testator. That is a question left wholly at large.
The decree, therefore, in its present state, could not be worked. We must consider,
however, whether the declaration complained of on both sides is a proper one to be
contained in this decree 1 The first observation which has occurred to me upon that
subject is this—The partnership of which the testator was a member determined upon
his death on the 26th of May 1843. The business was carried on from that time, not
as a continu-[173]-ance of the old partnership, but on a new agreement entered into
between the surviving partners and Henry Simpson the new partner ; Henry Simpson
standing in the character of executor, but entering into the partnership not in that
character, but on his own separate and individual account. There is here a complete
agreement on which, from the year 1843 down to the present time, these parties
(including Abel Chapman who is not represented on this record) have been carrying
on their banking business; and this bill contains no materials for setting aside the
agreement which has been entered into between these parties as entered into by them
in fraud of the testator's estate. I mean " i n fraud," of course not in the moral sense,
but in the sense of "contrary to the rights of the testator's estate." Whether the
agreement was contrary to those rights so as to affect Abel Chapman, I do not say ;
but at all events it appears that the existing partnership has been carried on upon a
new agreement, which this bill does not seek to disturb; and I do not well see how
the declaration can stand, when the bill does not seek to impeach or disturb the
agreement on which the partnership has in fact been carried on.
If, however, the bill had sought to disturb that agreement, what is the ground on
which a residuary legatee of a deceased partner is entitled to claim profits derived

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474 CLOSE V. CLOSE 4DEO. M. &G. 174.

from his share 1 That right is founded on a breach of trust in the executor and in
the partners, in continuing the trade with the capital which the testator had in the
concern at the time of his death. But how is this Court, in the absence of Abel
Chapman, to declare that there has been a breach of trusjb on the part of the
executors and on the part of Abel Chapman in entering into this new agreement, and
carrying on this business ? If there was a breach of trust on the part of the executors,
there was equally a [174] breach of trust on the part of Abel Chapman, for which
all must be responsible. He may say, " I never was a partner with the executors of
this testator; I became a partner with Henry Simpson in his separate and individual
character." And is this Court to determine that, as between the executors of the
testator and the legatees of the testator, the partnership was carried on with the
testator's assets, when, if the question comes to be tried between Abel Chapman and
the executors of the testator in a suit for the purpose of winding up the partnership,
Abel Chapman may be able to shew that he in truth never did become a partner with
the testator's executors, and never did in fact employ any part of the capital of the
testator in carrying on the business 1
There is another, and, as it appears to me, by no means an unimportant question
to be considered before a decree can be made on this part of the case. The Plaintiff's
claim is founded (as I have already observed) on a breach of trust. If the legatees
have a right to complain of that breach of trust, is not that a right which must be
enforced by winding up the concern and putting an end to the breach of trust1? Is a
breach of trust to be continued under the sanction of this Court by a continuing
account? All the cases which I remember upon that subject have been cases where
the legatees have come against the executors and against the surviving partners,
complaining that the two parties have employed the assets of the testator in carrying
on the concern, and praying that those assets may be taken out of the concern. This
bill seeks no such relief.
I am quite satisfied on all these grounds that the inquiry directed by this decree
in reference to these points ought not to have been contained in it. It was urged by
Mr. Prior, that Henry Simpson, having received [175] profits of the business, and
being unable to distinguish how much of them was attributable to the character
of executor and how much belonged to him in his individual character, must be
charged with the whole. I believe, however, that that principle has never yet been
applied to a case of this description where the executor has not been carrying on the
trade as executor, but in his own separate and individual right, conceiving that he
was entitled so to carry it on.
On these grounds my opinion concurs with that of my learned brother, that the
reference with regard to the ninth inquiry, and the declaration consequent upon it,
must be omitted.

[176] CLOSE V. CLOSE. Before the Lords Justices. July 11, 1853.

A necessary consequence of a reservation in a composition deed of a creditor's

remedies against a surety is the continuance of the surety's right to be indemnified
by the principal debtor, and this right will not be held to be abandoned unless a
contract to abandon it is proved. Therefore, where one of the creditors who
acceded to a composition deed was also a residuary legatee of a surety for the
compounding debtors to another creditor, and one of the compounding debtors
happened to be the surety's executor: Held, that the residuary legatee's accession
must be taken to have been in respect of his direct debt only, and did not
preclude him from insisting on the surety's estate being indemnified by the
debtors.

This was an appeal from the decision of Vice-Chancellor Stuart, who, on excep-
tions to the report of the Master, held the Eespondent entitled to credit as executor
of the testator in the cause for a sum of £ 1196, 16s. 7d., claimed by the Respondent
in his discharge.
In September 1833, John Close the younger, and James Close the Defendant
(who were sons of the testator, and carried on business in partnership as merchants

HeinOnline -- 43 Eng. Rep. 474 1557-1865