Page:Federal Reporter, 1st Series, Volume 1.djvu/828

 820 FEDBBAL BBPOBTEB. �whole elass of cases the rules of law are well settled, but they afford little or no aid in determining the questions that arise where the money or the property used by the firm is brought in through the fraud of one of the partners in abusing the trust confided to him by a third party. �Where a third party loans money to a partner on his individual credit, his putting that money into the firm creates no contract between the firm and the lender, for the very obvious reason that it was the lender's intention to lend the money to the individual partner, and, as in such a case the money is ient without any restriction as to its use, the bor- rower may do what he likes with it, and what he does with it is no longer any concern of the lender; and, of course, it makes no difference whatever that the borrower's copartner happens to know, when the borrower pays it into the firm, that he bas borrowed it even for the purpose of lending it to the firm. �If a partner, in applying for a loan, however, acts therein as s, partner and for his firm, then the firm will owe the money to the lender, even though he did not, at the time, know that the borrower was acting for his firm. At any rate, if he chooses to treat the firm as the borrower, he may do so as in any other case of an undisclosed principal acting through an agent. But it is unnecessary to refer especially to this «lass of cases, because the principles that govern the present «ase are not those that relate to the lending of money unat- tended by fraud or breach of trust. �It is claimed by the learned counsel for the contesting «reditors that the rule of law is well settled that where a partner, coming into the possession of money by the abuse of his individual trust, or duty to a third person, puts that money into the firm without any knowledge of the fraud on the part of his copartners, no obligation arises on the part of the firm to pay back the money to the party who, as against the partner so wrongfully paying it in, could demand it ; that, though the guilty partner is liable to the person wronged, the firm is not liable ; that, though the party wronged, if he can trace the money distinguishable from other moneys in the ��� �