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Duration and Kinds Of Partnership-Performance And Discharge Of Contracts
Business Environment and Law-Performance And Discharge Of Contracts
Duration and Kinds Of Partnership-Performance And Discharge Of Contracts
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Partnership may, from the point of view of its duration, be categorized into the following two classes: (1) Partnership for a fixed term or particular partnership (2) Partnership at will.
Duration Of Partnership
Partnership may, from the point of view of its duration, be categorized into the following two classes: (1) Partnership for a fixed term or particular partnership (2) Partnership at will.
Kinds Of Partners
There may be different kinds of partners in a partnership firm. The important classification of partners is given below:
1. Actual or active partners,
2. Dormant or sleeping partner,
3. Nominal partner,
4. Partner in profits only,
5. Sub-partner,
6. Partner by estoppel or by holding out.
Actual or active partners: Partners actively engaged in the conduct of the business are known as ‘active’ or ‘actual’ or ostensible partners.
Dormant or sleeping partner: The nominal partner is one who lends his name to the partnership firm without any real interest in terms of investing money in the firm or sharing in profits.
Nominal partner: The nominal partner is known to the outsiders and does not share the profits of the firm.
Partner in profits only: A person who does not want to take risk of loss may agree to become a partner in profits only.
Sub-partner: When a partner agrees to share his share of profit in a partnership firm with the outsiders, such an outsider is called a ‘Sub-partner’.
Partner by estoppel or by holding out: If a partner, by his words or conduct holds out to another that he is a partner, he will be stopped from denying that he is not a partner. Such a partner neither contributes any capital nor participates in the management. He is only liable to third parties.
Nominal partner: The nominal partner is known to the outsiders and does not share the profits of the firm.
Partner in profits only: A person who does not want to take risk of loss may agree to become a partner in profits only.
Sub-partner: When a partner agrees to share his share of profit in a partnership firm with the outsiders, such an outsider is called a ‘Sub-partner’.
Partner by estoppel or by holding out: If a partner, by his words or conduct holds out to another that he is a partner, he will be stopped from denying that he is not a partner. Such a partner neither contributes any capital nor participates in the management. He is only liable to third parties.
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