Feitelberg v Kaplan and Kaplan [1913] ZAWLD 13 (7 May 1913)

Partnership - Profit and loss - Participation in - Legal effect of - Goodwill - lntention of parties

Although an agreement for participation in profit and loss is prima facie evidence of a partnership between the contracting parties as between themselves, yet the question of partnership must in all cases depend upon the intention of the parties as it appears on the contract.

A firm of general dealers and auctioneers employed the plaintiff as its auctioneer. The plaintiff was to participate in the profit and loss of the firm, but was not to be a member thereof. In calculating the profits from time to time the value of the goodwill was not taken into consideration. The plaintiff took no part in the management or financial arrangements of the firm.

Held, that, under the circumstances, the plaintiff was not a partner of the firm, and that on leaving the firm he was not entitled to a share in the goodwill.