The Liverpool Standard and General Commercial Advertiser.
Liverpool, Merseyside, England, 1853-09-06 00:00:00

LECTURE, YESTERDAY.

Yesterday, Mr. Leone Levi delivered the second lecture
of his course, on commercial law, in the Chamber of Com-
merce. The chair was occupied by F. Shand, Esq., chair-
man of the Chamber of Commerce ; the attendance was
very limited in number.
The CHAIRMAN on taking his seat expressed regret
at witnessing so small an attendance, and said that under
the circumstances it would probably become a question
with Mr. Levi whether he would continue the course of
lectures he had announced, or whether it might not be
desirable to change the hour of lecture; as it seemed,
judging by the attendance, that the present hour was not
well suited to the convenience of gentlemen engaged in
active commercial business. For himself, he regretted
that, in consequence of another engagement, he was afraid
it would not be in his power to be present at the lecture
which was to take place on Thursday. He begged it to
be understood that these remarks were not intended to
interfere in any way with the arrangements which Mr.
Levi had made.
Mr. M`FIE suggested, with deference to the chair, that
if the importance of Mr. Levi's lectures were made more
fully known, as no doubt it would be through the press,
the gentlemen of Liverpool, becoming alive to the informa-
tion to be conveyed, would attend in greater numbers.
However appearances might in the present instance seem
to be against him, he (Mr. M`Fie) entertained no doubt
that a second course of those lectures would be well
attended.

Mr. LEVI expressed his unwillingness to have any inter-
ruption of the present course of lectures. If, however, a gene-
ral expression were shown, of a desire to attend the course in
the Collegiate Institution, he might be induced to make
such arrangements as would meet that desire. In the mean-
time he should prefer going on with the lectures as
announced.

He commenced by stating that partnership, the subject
matter of the lecture he was now about to deliver, was one
which had created much interest in this country ; and it
was not to be wondered at that, in a country so extensively
engaged in commerce as this is, so important a subject
should have commanded deep and wide-spread attention.
To follow out, in anything like a systematic form, an idea
of partnership, we must revert to the pastoral ages. In
those times, he said, of primitive existence, it would be
found that capital and labour were so dependant on each
other, and so interwoven, as to be inseparable. The shep-
herd gave his attendance upon the flocks entrusted to his
care, while the flock-master entrusted his capital to the
safe keeping and guidance of the shepherd. In this primi-
tive style of arrangement, the advantages of each party, in
the simple contract, were attended to, and there were no
third parties to interfere or be consulted. This might be
considered the simplest form of partnership, and it sufficed
for the interests involved in the transaction. When the
Italian merchants began to explore, with an eye to com-
merce, the eastern ports, a more distinct form of partner-
ship was evolved. The merchandise which they brought
home, as well as that which they exported, required to be
put under the control of other parties than them-
selves ; and this was done by the intervention of ship-
owners, or, as they were then denominated, commanders,
and individuals who alone had charge of the cargo.
In this form of transaction the process was extremely
simple, the charge of the ship devolving on the com-
mander, without risk beyond his ship, and the mercantile
adventure devolving absolutely on the supercargo. The
same simplicity of principle, he remarked, was also observed
among the adventures of the Crusades. By-and-by, how-
ever, the adventure was shared in by others, and indivi-
duals finding it profitable, advanced money to be embarked
in the purchase of such merchandise as those acquainted
with the particular traffic thought most advisable. From
this simple form of partnership the system grew to its pre-
sent importance, and as it became developed it grew in
favour; and it is now generally admitted that its value
cannot be over estimated. It gives, said the lecturer, to
small capitalists an opportunity of combining their stock,:
and so of competing with capitalists of the largest means.
He should not, he said, offer any opinion as to the pro-
priety or impropriety of such combinations, but confine
himself to a few observations on the practical working of
the system. In this country, he said, co-partneries may be
formed by different processes. They may be formed by
Charter of Incorporation from the crown ; in which case
the liabilities of the partners are generally limited to
specific amounts ; or they may be formed by special act of
parliament, in which case also there is generally a specified
extent of liability ; or they may be formed under the pro-
visions of the joint-stock and banking-companies act, in
which case the liability is unlimited. Charters of incorpo-
ration, he observed, are generally granted with great
hesitation, and mostly for the purposes of effecting impor-
tant public objects, because it is considered that conferring
on a company the right of limited liability is exceptional,
and as offering to it unfair privileges compared with other
companies and with individuals. To obtain a charter
from the crown, or by act of parliament, was, therefore,
made an expensive proceeding, and used to cost about
£l,OOO. Now, the expenses were very considerably modi-
fied, and it was understood that the mere fees might be
got over for somewhere about £BO. In the United States
he observed that the common form of partnerships secured
limited liability for mercantile firms of all descriptions ;
but in banking establishments the responsibility of the
partners was unlimited. In that country charters were
granted for carrying on such undertakings as banking, the
construction of railways and canals, and other great public
works, on very easy terms, the cost being only an outlay
of about eight shillings for an official copy of the act under
which such enterprises are authorised. In that country,
judging from its operation, the law seems to work advan-
tageously. In France the formation of partnerships is
regulated under different forms, the most prevalent being
that of what is called common detail. There are also
forms under which the names of all the partners are
registered, and companies so formed in that country pos-
sess the advantage of suing, and being sued, in the name
of their managing officials. Charter companies also are
common ; but in these it is commonly only the name of
the enterprise which attaches to the company. Spain
also, he said, has similar modes of constituting partner-
ships with those existing in France. In Portugal there is
an additional provision,which:recognises the rights of labor
as well as those of capital ; in that instance, however, it was
provided that the industrial partner shall not bepermitted to
sign anydocument in the name of the firm. In the Nether-
lands, in Prussia, in Russia, and in Austria, the laws re-
gulating partnership differ only in minute detail from
those of France. In nearly all, if not in all instances, in
those countries where the words " and company" occur
after any name or names, it is understood that the full
responsibilities of the firm only devolve upon the parties
whose names are announced, and that the liabilities of all
who are included in the words " and company," are
limited to the amount for which they are individually
engaged to, and in the firm. Numerous attempts, he said,
had been made in this country, so to amend the law of
partnership as to give security and confidence to the
public, while it might relieve individuals from a weight
of responsibility which they had not the slightest idea of,
and over which, in reality, they had no practical control.
Committees had, at different times, been appointed to
acquire information on the subject, and to report as to
how the object could be most satisfactorily accomplished.
The result of those investigations had been, that the ma-
jority of testimony was in favour of establishing a system
somewhat akin to the partnership by common de-
tail, in which all the anonymous partners should
only be liable to an extent equivalent to their in-
terest in the partnership. In this balance of testimony,
merchants, dealers, and barristers, might generally be
set down as favourable to the change ; while bankers
were generally adverse to it. This must not, however,
be taken as absolutely correct, several bankers having
expressed themselves favourable, while barristers and
merchants have been adverse to such an arrangement.
In England, he remarked, it was well known that every
partner is involved for the whole liabilities of the partner-
ship in which he has engaged, and that irrespective of
whether he has a control in its management or not ; from
this system, extreme hardship had frequently arisen.
On the Continent, on the contrary, a partner by common
detail is only liable for the amount of his engagements to
his fellow-partners, the public having recourse only on
those whose names appear in the firm. Yet it was found
that practically no disadvantage arose from the system.
The main advantages of the system, it was, he said, con-
tended by its advocates, would be to enable parties with
small means to unite and pursue an object with as much
energy and success as was done by great capitalists. It
was well known that many individuals, tradesmen and
others, of unquestionable honesty and intelligence, were
made severely to suffer from the difficulty of obtaining a
command of capital. Such combinations would have
the effect of breaking down monopoly; and of removing
the cause of breaches between employers and the em-
ployed. The chances of any additional doors being
opened to the perpetration of fraud, it was contended,
would be effectually prevented by the exercise of that more
prompt vigilance which it would occasion. In conclusion,
the lecturer intimated that, in his next, he should enter
into the details of the law of partnership as that at pre-
sent exists.

The CHAIRMAN remarked, that as the Chamber of
Commerce had not made any formal report upon the sub-
ject, it appeared to him that the feeling of the body could
not be presumed as favourable to the movement, although
it might be unfair to come to any definite conclusion with
respect to that at all. In regard to the question of li-
mited liability, he was not himself quite so sure. It was
no doubt an easy thing to limit the liability of individuals.

in so far as gas or water companies were concerned ; but,
it did seem to him that, if limited liability was introduced
as a principle in ordinary mercantile transactions, there
might be considerable difficulty in preventing the business
of a company from being diverted, into other channels than
those for which it was originated. In such a case, the
whole of the capital might be expended, leaving nothing
to meet legitimate engagements, but the unlimited liabi-
lity of the ostensible partners.
Mr. BOIILT expressed himself as satisfied that, through
the agency of the present system, all the evils supposed to
accompany limited liability were in full operation. As an
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