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Difficulty: MediumPartnership: Types, Deed, Rights, and Dissolution

Emeka and Folake have been operating a general partnership business involved in retail logistics for five years without executing a written Partnership Deed. Emeka decides to admit his sibling as a third active partner to expand operations, despite Folake's explicit objection. Under the provisions of the Partnership Act, what is the legal standing of Emeka's action?

  1. The action is legally invalid because introducing a new partner requires the unanimous consent of all existing partners.Answer
  2. B
    The action is legally valid provided Emeka contributed a majority share of the initial business capital.
  3. C
    The action is legally valid because active partners possess equal individual authority to appoint new management partners.
  4. D
    The action is legally invalid only if the objecting partner applies for a court decree to dissolve the firm.

Answer

The admission of the new partner is legally invalid because introducing a new partner requires the unanimous consent of all existing partners.
Under the statutory provisions of the Partnership Act, which govern partnerships lacking a written Partnership Deed, no person may be introduced as a partner without the consent of all existing partners. Because one partner explicitly objected, the requirement for unanimous consent was not met, rendering the action invalid.

Step-by-Step Solution

1
Determine the governing rules when partners operate without a written agreement.
In the absence of a written Partnership Deed, the statutory default provisions of the Partnership Act apply to determine the rights and duties of partners.
The Partnership Act provides standard rules for partnership operations when partners have not agreed otherwise.
2
Identify the statutory requirement for admitting new partners.
Under the Partnership Act, no new partner may be introduced into an existing firm without the unanimous consent of all existing partners.
Partnership is based on mutual agency and trust, meaning no partner can be forced into a contractual partnership relation without their consent.
3
Apply the rule to the given scenario.
Because Folake explicitly objected, unanimous consent was not obtained, making Emeka's unilateral admission legally invalid.
A single existing partner's objection is sufficient to block the introduction of a new partner.

Key Concept

Implied Rights of Partners and Admission of New Partners under the Partnership Act
Estimated Time:1m 0s
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Topics

Partnership: Types, Deed, Rights, and Dissolution

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