Liability of partners, Liability of partners : A) Under contract law :

Liability of partners

Liability of partners:

A) Under contract law:

Liability is joint only (collectively);
The creditor has only one right of action (except in NSW, where liability is now joint and several).

B) Under the law of torts:

Liability is joint (collectively) and several (individual);
Liability of co-partners only arises:

-Where the act or omission was in the ordinary course of the business of the firm; or
-It was with the authority of the co-partners.

C) Holding Out:

A person who holds themselves out as a partner by their words or conduct may become liable as an ‘apparent partner’.

D) Retiring partners:

Remain liable for debts incurred before retirement unless the creditors and other partners agree otherwise;
May be liable for debts incurred by the partnership after retirement if they have not taken steps to notify former and new customers of their retirement.

View Complete Question

Related Questions in Managerial Accounting

Q : Asset retirement obligation Significant

Significant costs associated with the disposal of asset. Accounting for asset retirement obligations requires estimating the cost and discounting estimate. The present value added to the asset's depreciable base and a liability is recorded for the obligation. Every year, interest expense is added

Q : Management accounting-scope Write down

Write down the scope of Management accounting?

Q : Define Differential Cost Differential

Differential Cost: The cost difference predicted when one course of action is adopted rather than others.

Q : Define Expense Expense : The Outflow or

Expense: The Outflow or other using up of resources or acquiring liabilities (or a combination of both), the advantages from which exert to an entity's operations for the present accounting period, however they do not expand to future

Q : What is Partnership Partnership :

Partnership: Whenever two or more persons enter into an agreement to take on business and share its gain and losses, it is a condition of partnership. It can also define as: "Partnership is the relation among persons and who have granted to share the

Q : Define Cost Cost : The monetary value

Cost: The monetary value of resources employed or liabilities or sacrificed incurred to attain an objective, such as to obtain or make a good or to execute an activity or service.

Q : Bank reconciliation statement Explain

Explain the term bank reconciliation statement?

Q : What is Variable Cost Variable Cost : A

Variable Cost: A cost which differs with changes in the level of an activity, whenever the other factors are held constant. The cost of material treating to an activity, for illustration, differs according to the number of material de

Q : Define Responsibility Center

Responsibility Center: It is an organizational unit headed by the manager or a group of managers who are responsible for its actions. The responsibility centers can be measured as revenue centers (that is responsible for revenue or sa

Q : Define Job Costing Job Costing : It is

Job Costing: It is an order-specific costing method, utilized in situations where each job is distinct and is executed to the customer's specifications. Job costing includes keeping an account of direct and in-direct costs.

Discover Q & A

Leading Solution Library

Avail More Than 1442345 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads

No hassle, Instant Access

Start Discovering

18,76,764

1944417
Asked

3,689

Active Tutors

1442345

Questions
Answered

Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

Submit Assignment