Partnership liability ...Whether continuing partner or Legal Reps.?

Question

sir,

Two partners in an unregistered Partnership firm borrowed some amount from third parties. suddenly one partner expired. and a civil case has been filed by third parties against partners. They have brought legal rep. on record. Please suggest who are liable to pay the amount to the third parties ? whether continuing partner or L.R's ? any citations. from Indian courts..

Answer 1

Both the continuing partner as well legal representative of the deceased partner is liable to pay the amount to the third parties. In this case the suit was filed by the third parties during the life time of the deceased partner & hence the L.R of this partner was brought on record. The L.R can adjust the amount he pay to the third parties in this suit while settling the final accounts of this partnership firm with the existing partner. The L.R has right to get the margin of the profit which the deceased partner would have got from this partnership along with the original amount invested by the said deceased partner, hence any payment liability which the said deceased partner would have to pay to some third party will also be on this legal representative of the deceased partner. In my last reply to a similar question posted by you I had made this point very clear that L.S is responsible for liabilities of the deceased partner for any transaction he did till his death in this partnership firm & not for the transactions carried out by the other partner even after the death of the other partner whom this legal representative represent. In this case at the time of this recovery suit filled by the third parties the said deceased partner was alive & hence his L.R is responsible for his liabilties.