Rights, Duties and Liabilities of Partners-Performance And Discharge Of Contracts
Rights,
Duties and Liabilities of Partners
Rights
Right to take part in the conduct of business
Right to be consultedRight of access to the booksRight to share profitsRight to interest on capitalRight to interest on advancesRight to indemnityRight to act prudently in emergencyRight to give consent for admission of a new partnerRight to retireRight to carry on competing business after retirement.
Duties
A. Qualifying
To attend his duties diligentlyTo work without remunerationTo contribute to lossesTo indemnify for willful neglectTo use firm’s a property exclusively for the firmTo account for private profits [Sec.16(a)]
B. Others
Duty to carry on business for the common advantage
To indemnify for loss caused by fraud
To give full information
To render true accounts
To be just and faithful
Liabilities
Liability
of partner for acts of the firm: Every partner is liable, jointly with all the other partners
and also severally, for all acts of the firm done while he is a partnerLiability
of the firm for wrongful acts of the partner: Where,
by the wrongful act or omission of a
partner acting in the ordinary course of the business of a firm, or with the
authority of his partners, loss or injury is caused to any third party, or any
penalty is incurred, the firm is liable therefore to the same extent as the
partner (Section 26).Liability
of the firm for misapplication by partners: (i)
When a partner acting within his
apparent authority receives money or property from a third party and misapplies
it, or (ii) A firm in the course of its business receives money or property
from a third party, and the money or property is misapplied by any of the
partners while it is in the custody of the firm, the firm is liable to make
good the loss (Sec. 27).Liability
for the loss caused by his own fraudLiability
for the loss caused by his own willful neglect.
Tags : Business Environment and Law-Performance And Discharge Of Contracts
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