Sunday, May 15, 2016


Chapter 9: Law of Partnership

A partnership is a voluntary association of two or more persons, who contribute, money, property, time, care or skill, a lawful business for profit and to share the profits and losses of the business.

Essential Of Partnership
·      
      Agreements                                                                                               
    results of an agreement between person who want to form a partnership.
·     
             Number of Partners                                                                                          
     - a partnership consisting of more than 20 persons for carrying on any business is illegal.
·        
    Existence of Business                                                                     - the partners must agree to carry on a business
·     
               Sharing of Profits                                                                                            - the agreement between the parties must be to share the profits of a business
·       
     Duration                                                                                                      - the partnership continues at the will of the partners.


Kind of Partners
      
      1)  Active Partner
     
      2) Sleeping Partner
      
      3)Norminal Partner
      
      4) Senior Partner
      
      5)  Junior Partner
     
      6) Partner in profit only


 Types of Partners
     
    1) Partnership at will: where no provision is made in the contract regarding       the duration of partnership.
      
     2)  Particular partnership: where partnership is formed to do a particular             business. Such partnership is dissolved immediately after the completion     of that business.

Rights Of Partners
    
     *   Right to take part in business
    
     *   Right to inspect books.
    
     * Right to share profits.
    
     *  Right to give consent.
    
    *  Right to retire: a partner can retire with the consent of other partners

Duties of partnership
·      
    Duty to carry on Business:                                                            -- it is the duty of every partner to carry on the business of the firm for the common advantage.
·     
            Duty to be just and faithful:                                                       - the partners should be faithful and just towards the firm

Duty to indemnify:                                                                       -every partner is bound to indemnify the firm for any loss

Dissolution of partnership  

1)  A firm may be dissolved with the consent of the partners.

2)  A firm is compulsorily dissolved if all the partners except one, become insolvent

3)  If a firm is constituted for a certain term, then it stands dissolved after the expiry of the term.   

1 comment:

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