Section 1025. The ordinary partnership is that kind of partnership in which all the partners are jointly and unlimitedly liable for all the obligations of the partnership.
Relation of Partners between Themselves
Section 1026. Each partner must bring a contribution to the partnership.
Such contribution may consist of money or other properties or of service.
Section 1027. In case of doubt, contributions are presumed to be of equal value.
Section 1028. If the contribution of the partner consist merely of his personal service and the contract of partnership does not fix the value of such services, the share of such partner in the profits is equivalent to the average of the shares of the partners whose contributions are in money or other properties.
Section 1029. If a partner brings as contribution the use of a property, relations between such partners and the partnership with regard to;
are governed by the provisions of this Code concerning the Hire of Property.
Section 1030. If the contribution of a partner consist of the ownership of a property, the relations between such partners and partnership with regard to:
are governed by the provisions of this Code concerning Sale .
Section 1031. If a partner wholly fails to deliver his contribution, a written notice must be given him by a registered letter to deliver it within a reasonable time, failing which he may be excluded from the partnership by a decision of all the other partners, or of such majority as provided in the contract.
Section 1032. No change in the original partnership or in the nature of the business may be made except by the consent of all the partners, unless the be an agreement providing otherwise.
Section 1033. If nothing has been agreed between the partners as to the management of the business of the partnership, such business may be managed by each of the partners, provided that no partner may enter into a contract to which another partner objects.
In such case, each partner is the managing partner.
Section 1034. If it is agreed that matters relating to the business of the partnership shall be decided by a majority of partners, each partner shall have one vote, irrespective the amount of his contribution.
Section 1035. If it is agreed that the business of the partnership shall be managed by several managing partners, such business may be managed by each of the managing partners, provided that no managing partner may do anything to which another managing partner objects.
Section 1036. Managing partners may be removed from their position only by the consent of all the other partners, unless there be an agreement providing otherwise.
Section 1037. Even if partners have agreed that the business of the partnership shall be managed by one or more managing partners, each non-managing partner has the right to enquire at any time into the management of the business and to inspect and copy any of the partnerships books and documents.
Section 1038. No partner may either on his own account or on account of another person carry on, without the consent of the other partners, any business of the same nature as and competing with that of the partnership.
If a partner acts contrary to the provisions of this section, the other partners are entitled to claim from him all the profits which he has made or compensation for the injury which the partnership has suffered thereby, but such claim cannot be entered later than one year after the date of contravention.
Section 1039. A partner is bound to manage the business of the partnership with as much care as he would take of his own business.
Section 1040. No person may be introduced as partner in the partnership without the consent of all partners, unless the be an agreement providing otherwise.
Section 1041. If a partner, without the consent of the other partners, transfers to a third person the whole or part of his share in the profits of the partnership, such third person does not become partner.
Section 1042. The relations of the managing partners with the other partners are governed by the provisions of this Code concerning Agency.
Section 1043. If a non-managing partner manages the business of the partnership or a managing partner acts beyond the scope of his authority, the provisions of this Code concerning Management of Affairs without Mandate shall apply.
Section 1044. The share of each partner in the profits or losses is in proportion to his contribution.
Section 1045. If the share of a partner id fixed only as to profits or only as to losses, the proportion is presumed to be the same for profits and losses.
Section 1046. No partner is entitled to remuneration for having managed the business of the partnership, unless there be an agreement providing otherwise.
Section 1047. If the name of a partner whose membership has ceased is used in the firm name, he is enitled to demand that such use shall cease.
Section 1048. A partner may claim from the other partners a share even in a transaction where his own name did not appear.
Relation of Partners with Third Persons
Section 1049. No partner can acquire any right against third persons by a transaction where his own name did not appear.
Section 1150. All the partners are bound by the acts done by any of them in the ordinary course of the business of the partnership and are jointly and unlimitedly liable for the performance of the obligations incurred in such management.
Section 1151. A partner whose membership has ceased continues to be liable in respect of obligations incurred by the partnership before he became a partner.
Section 1152. A person who becomes member of a partnership is liable for any obligations incurred by the partnership before he became a partner.
Section 1153. No restrictions of the power of a member of a non-registered partnership to bind the other partners can have effect with respect to third persons.
Section 1054. A person who by words spoken or written, or by conduct, or by consenting to the use of his name in the firm name of the partnership, represents himself, or who knowingly suffers himself to be represented as a member of a partnership becomes liable to third persons as a partner for all the obligations of the partnership.
If after the death of a partner the partnership business is continued in the old firm name, the continued use of that name or of the deceased partner, as part thereof, does not in itself make his estate liable for any obligations incurred by the partnership after his death.
Dissolution and Liquidation of Ordinary Partnerships
|(1)||In the cases, if any, provided by the contract of partnership .|
|(2)||If made for a definite period of time, by the expiration of such period.|
|(3)||If made for a single undertaking, by the termination of such undertaking.|
|(4)||By any of the partners giving to the other partners due notice as provided by section 1056.|
|(5)||By the death of any partner or by any partner becoming bankrupt or incapacitated.|
Section 1056. If a partnership is entered upon for any indefinite period, it can only be terminated by a partner at the end of a financial year of the partnership; and such partner must give at least six month’s notice of his intention to terminate.
Section 1057. An ordinary partnership may also be dissolved by the Court on application by a partner in any of the following cases:
When a partner, other than the partner suing willfully or by gross negligence violates any essential obligation imposed upon him by the partnership contract.
When the business of the partnership can only be carried on at a loss and there is no prospect of its fortunes being retrieved.
|(3)||When there is any other cause making the continuance of the partnership an impossibility.|
Section 1058. Upon the occurrence of any event connected with one partner which according to Section 1057 or Section 1067 entitles the remaining partners to demand the dissolution of the partnership, the Court may upon the application of the remaining partners instead of such dissolution order the expulsion of the partner in question.
For the purpose of the division of property between the partnership and the expelled partner, the partnership property must be assessed and valued at which it stood at the time when the application for the expulsion was first made.
Section 1059. If at the expiration of the period agreed upon, the business of the partnership is continued by the partners or by such of them as habitually managed it during the said period, without any settlement or liquidation accounts, the partners are deemed to have agreed to continue the partnership for an indefinite period of time.
Section 1060. In any case under Section 1055, sub-section (4) or (5), if the subsisting partners buy the share of the partner whose membership has ceased, the contract of partnership continues between the subsisting partners.
Section 1061. After the dissolution of a partnership the liquidation shall take place, unless some other method of adjustment of property between the partners has been agreed upon or unless the partnership is adjudicated bankrupt.
If the dissolution is brought about by notice given by a creditor of one of the partners or by the bankruptcy of one of the partners, the liquidation can only be dispensed with the consent of the creditor or of the official receiver.
Liquidation shall be carried on by all the partners or by persons appointed by them.
The appointment of liquidators is decided by a majority of votes of the partners.
Section 1062. The liquidation must be made in the following order:
|(1)||Performance of the obligation incurred towards third persons .|
|(2)||Reimbursement of advances made and expenses incurred by the partners in managing the business of the partnership.|
|(3)||Return of the contributions made by each partners.|
The balance, if any, must be distributed as profit between the partners.
Section 1063. If, after the performance of the obligations incurred towards third persons and reimbursement of advances and expenses, the assets are insufficient to return the hole amount of contributions to the partners, the deficiency constitutes a loss and must be divided as such.
Registration of Ordinary Partnership
Section 1064. An ordinary partnership may be registered.
The entry in the register must contain the following particulars:
|(1)||The firm name of the partnership .|
|(3)||The address of the principal business office and of all branch offices.|
|(4)||The full names, addresses and occupations of every partner: if a partner has a trade name the entry in the register must contain his name and his trade name.|
|(5)||The names of the managing partners, in case fewer than all of the partners have been appointed as such.|
|(6)||The restrictions, if any, imposed upon the powers of the managing partners.|
|(7)||The seal or seals which are binding on the partnership.|
The entry may contain any other particulars which the parties may deem expedient to make known to the public.
The entry must be signed by every member of the partnership, and must also be sealed with the common seal of the partnership.
A certificate of registration shall be delivered to the partnership.
Section 1064/1. A managing partner of a registered partnership who wishes to resign from his post shall tender his tender his resignation letter to any other managing partner. The resignation in writing shall take effect from the date the registration letter reaches the said other managing partner.
In the case where a registered partnership has only one managing partner, the managing partner who wishes to resign from his post shall notify any other partner of his intention in writing, together with the letter of resignation, so that a meeting could be held with a view to appoint a new managing partner. The resignation shall take effect from the date the resignation reaches the said partner.
The managing partner who resigns under paragraph one or paragraph two hereof may notify the Registrar of his resignation.
Section 1064/2. When there is a change of managing partner, the registered partnership shall effect the registration thereof within fourteen days from the date of such a change.
Section 1065. A partner can take advantage against third persons of any right acquired by the registered partnership, even though his name did not appear in the transaction.
Section 1066. No partner of a registered partnership may, either on his own account or on account of another person, carry on without the consent of all the other partners any business of the same nature as and competing with that of the partnership or without such consent be member with unlimited liability in another partnership carrying on a business of the same nature as and competing with that of the registered partnership.
Such prohibition does not apply if it was already known to the partners at the time of registration of the partnership that one of them was engaged in a business or in other partnership having the same object, and if his withdrawal was not stipulated in the contract of partnership.
Section 1067. If a partner acts contrary to the provisions of the foregoing section, the registered partnership is entitled to claim from him all the profits which he had made or compensation for the injury which the registered partnership has suffered thereby.
Such claim cannot be entered later than one year after the date of contravention.
The provisions of this section are without prejudice to the rights of the remaining partners to demand the dissolution of the partnership.
Section 1068. The liability of a partner in a partnership in respect to obligations incurred by the partnership before he ceased to be a member of such partnership, is limited to a period of two years after the ceased to be a member.
Section 1069. In addition to the cases provided by Section 1055, a registered partnership is dissolved if it becomes bankrupt.
Section 1070. The creditor of an obligation due by a registered partnership is entitled, as soon as the partnership is in default, to demand performance of the obligation from any of the partners.
Section 1071. In the case provide by Section 1070, if the partner proves:
|(1)||That the assets of the partnership are sufficient to perform the whole or part of the obligation, and|
|(2)||That enforcement against the partnership would not be difficult.|
The Court may, in its discretion, order that the obligation be enforced first against the assets of the partnership.
Amalgamation of Registered Partnerships
Section 1073. A registered partnership may amalgamate with another registered partnership with the consent of all the partners, unless there be an agreement providing otherwise.
Section 1074. When a registered partnership has decided to amalgamate, the partnership must publish twice at least in a local paper and send to all creditors known to the partnership a notice of the proposed amalgamation requiring the creditors to present within three months from the date of notice any objection the may have to it.
If no objection is raised during such period, non is deemed to exist.
If an objection is raised, the partnership may not proceed with the amalgamation unless it has satisfied the claim given a security for it.
Section 1075. When the amalgamation has been made it shall be the duty of each of the partnership to cause the amalgamation to be registered as a new partnership.