1927 (11) TMI 6 - Other - Indian Laws

Summary

Issues:
1. Whether the sons of the deceased became partners in the business before or on their father's death.
2. Whether the house in question was part of the partnership assets.
3. Whether one of the partners had the power to mortgage the property to the Bank to bind the firm.

Analysis:
1. The judgment involves an appeal by three defendants from a Court of Appeal decision affirming a judgment in favor of the plaintiffs. The deceased, a clove merchant, executed a deed of gift in 1913 in favor of his six sons. After his death, the business was managed by three sons, and an equitable mortgage was later executed in favor of the respondents, the Standard Bank of South Africa, Ltd. The main issue was whether the sons became partners in the business before or on their father's death. The courts found that they did become partners, and the deed of gift's validity was deemed immaterial as the business assets vested in the sons after the father's death. The guardian of the minor sons had the power to bind them to the business, as evidenced by a request to open a firm account signed by the guardian.

2. The second issue was whether the house in question was part of the partnership assets. Both courts found it to be so, and this concurrent finding could not be disturbed. The house was considered part of the business assets, and hence, part of the partnership assets. The determination that the house was part of the partnership assets was upheld.

3. The third issue revolved around whether one of the partners had the authority to mortgage the property to the Bank to bind the firm. Even if the mortgage was deemed ineffective, the house, being part of the business assets, would be available for the general creditors. It was concluded that the managing partner had the power to execute the mortgage, rendering the question of the partner's authority to mortgage the property immaterial to the appellants. The judgment ultimately dismissed the appeal and advised accordingly to His Majesty, with no order as to costs due to the appellants appearing in forma pauperis. The widow's claim to maintenance was also addressed, stating her entitlement to maintenance under Khoja custom, subject to the general dealings with the estate by those in charge.