- This topic has 1 reply, 2 voices, and was last updated 7 years ago by
.
- Posts
Ham, Sam and Tam formed a partnership to run a petrol station. The partnership agreement expressly stated that the partnership business was to be limited exclusively to the sale of petrol. In February 20X8 Tam entered into a £15,000 contract on behalf of the
partnership to buy a stock of bicycles, which he hoped to sell from the garage forecourt.Explain the liability of the partners for the contract to buy the bicycles.
1. The answer is the partners are liable for the contract.
2. Could you explain how?
-Is it because the contract was a commercial one, therefore making the partners liable?“The acts of every partner in the course of the firm’s business bind the firm and the other partners. Where a partner exceeds his authority and the other party is not aware of that excess, the firm and the partners are all liable. The exception is where the other party knew, or should reasonably have known, that either (1) the partner was exceeding his authority or (2) was not aware that he was a partner”
OK?
- The topic ‘partner's authority’ is closed to new replies.