What are the Duties and Liabilities of Partners?

ADVERTISEMENTS:

1. Every partner must act diligently and honestly in the discharge of his duties to the maximum advantage of all the partners.

2. Every partner must act in a just and faithful manner towards each other.

3. Every partner must act within the scope of the authority entrusted to him.

ADVERTISEMENTS:

4. Every partner is bound to share the losses of the firm equally unless otherwise agreed.

5. Every partner must indemnify the firm against losses sustained due to his willful negliĀ­gence in the ordinary course of business

6. No partner can transfer or assign his interest in the firm to others without the consent of other partners.

7. Every partner must maintain and render true and correct accounts relating to the firm’s business.

ADVERTISEMENTS:

8. No partner must engage himself in a business in competition with the firm; otherwise he will be liable for any loss suffered by the firm. He will have to surrender private profits to the firm.

9. Every partner should use the firm’s property only for the firm’ business and interest.

10. No partner should make secret profits by way of commission or otherwise from the firm’s business. He is liable to account for and pay to the firm any private profit from the transactions of the firm or from the use of its property or goodwill.

11. Every partner is liable jointly with all the other partners and also severally for all the debts of the firm. The liability of a partner to third parties is unlimited.

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