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Actions Between Partners

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ACTIONS BETWEEN PARTNERS. A partnership is made up of individuals, and it is by and against these individuals that suits are brought. Hence if a partner would sue his firm, or a firm one or more of its partners, the difficulty arises that the same party is joined as both plaintiff and defendant. As a result of these difficulties actions at law by a partner against the firm, or by the firm against a partner, can not be maintained before dissolution, and such claims must be adjudicated in a court of equity.

Where all the partnership business is settled, or a special partnership involving a single transaction has been formed, or the accounts are easily adjusted, such suits at law may be brought. (Clarke v. Mills, 36 Kans. 393; Wheeler v. Arnold, 3o Mich. 304.) The rule extends to prevent one partner from suing another upon matters growing out of partnership transactions, unless there has been an accounting and a balance found in his favor. But upon claims con nected with, but arising from, or subsequent to, the partnership, suits may be maintained between the part ners, as for breach of agreement to form partnership, failure to contribute capital as agreed, failure to in demnify, or for dissolving the partnership contrary to agreement.

Partners may of course sue each other in regard to matters unconnected with the firm as freely as other individuals.

"In the absence of a statute authorizing it, one firm cannot maintain an action at law against another firm if there are partners common to both firms. The death of the common partner will not remove the impedi ment as to matters arising before the death, nor will the dissolution of the firm. The nature of the claim is immaterial, if it is an obligation in favor of one firm and against the other as such. The forum for actions in such cases is the court of equity."

firm, partnership and partner