Usama, Shahid and Hassan are partners in a partnership firm. With an agreement among them, they decided that no partner will have the authority to buy or sell goods above Rs. 20,000 without other partners’ consent. Unaware of this provision (restriction), Ali sold goods worth Rs. 45,000 to Shahid who did not inform (or consult with) other partners. According to Partnership Act, explain whether the partnership firm and its partners are liable to Ali under the circumstances mentioned above.

Usama, Shahid and Hassan are partners in a partnership firm. With an agreement among them, they decided that no partner will have the authority to buy or sell goods above Rs. 20,000 without other partners’ consent. Unaware of this provision (restriction), Ali sold goods worth Rs. 45,000 to Shahid who did not inform (or consult with) other partners. According to Partnership Act, explain whether the partnership firm and its partners are liable to Ali under the circumstances mentioned above.

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter11: Partnerships: Distributions, Transfer Of Interests, And Terminations

Section: Chapter Questions

Problem 44P

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Amy and Lester are partners in operating a store. Without consulting Amy, Lester enters into a contract to purchase $10,000 of merchandise for the store. Amy says she did not authorize the order and that she could have purchased the same merchandise for $7,000. Amy refuses to pay for the order. The vendor sues the partners. a. Must the partnership pay for the merchandise? If yes, how much? b. Assuming the partnership is a general partnership, can Amy’s personal assets be taken to pay for the merchandise?
The partnership of Winn, Xie, Yang, and Zed has the following balance sheet: Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $10,000 that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $10,000 from the liquidation. Determine the amount for which the partnership must sell the other assets to ensure that Zed receives $10,000 from the liquidation. Liquidation expenses are expected to be $30,000.
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Riff and Raff enter into a partnership agreement. However, the activity that they intend to undertake as the partnership business is illegal at common law and under commonwealth taxation legislation. Required: Explain the implications of the illegal purpose. b) Explain the rights of a trustee to be paid from the trust for work done or expenses incurred.
riff and raff enter into partnership agreement. However, the activity. that they intend to undertake as the partnership business is illegal at common law and under commonwealth taxation legistation. a) Explain the implications of the illegal purpose. b) Explain the rights of a trustee to be paid from the trust for work done or expenses incurred
A, B and C formed a commercial partnership. D represented himself as a partner in the partnership to E who, on the belief of such representation, extended credit of P50,000 to the partnership. Assuming only B and C consented to such representation, who shall be liable to E? a. B, C and D are partners by estoppels and thus, are liable to E? b. Only partners A, B and C are liable to E for the benefit extended to them. c. Only D who made the representation is liable to E. d. All of A, B, C and D are liable because of partnership liability for the credit extended to the partnership by E.
B promised that he will deliver a house and lot for the partnership to use for its manufacturing process. On the agreed date, B was not able to show the partnership the location of the house and lot. Later on, B informed the partnership that the house and lot were burned down. What is the remedy of the partnership against B? The partnership may file a civil case to compel B to pay damages. The partnership may file a civil case for judicial settlement of B. The partnership may file a criminal complaint of estafa against B. The partnership may file a criminal complaint of trespassing against B.
Lisa, Jeni and Jiso entered into a contract of partnership with a total contribution of P5,000. The parties failed to register its articles of co- partnership with SEC. Which of the following statements is correct? A. The contract of partnership is void because the law provides that when the capital contribution is at least P3,000 it must be registered with SEC. B. The contract of partnership will bind third persons. C. The contract of partnership remains to be valid. D. The partnership business does not obtain juridical personality for failure to register with SEC.
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