it is a relationship that subsist between persons carrying on business in common with a view of prot relationship an agreement between persons that is contractual in nature. Wong Peng Yuen v. Senanyake Here a partner of a rm executed a partnership deed which transferred shares from the capital of the rm to his children which was an attempt to admit them as partners. The other partner, D had consented. The children were not partners since there was no contract between them and the D expressly/impliedly. The transfer amounted to an assignment of the shares of the partnership not conferring on them partnership rights. Existence of Partnership Intention Chooi Siew Cheong v. Lucky Heights Development Here the proprietor of the land entered into a joint venture agreement where he contributed land with the developers who develop houses / shoplots. Were they partners? There was no partnership as the intention of both parties was wholly separate business & was no business in common. In deciding whether the partnership exits the courts must look at sec.4 and the intention of the parties. Verbal/written agreement, but need to look surrounding circumstances Aw Yong Wai Choo v. Arief Trading Sdn. Bhd To ascertain intention the courts will take into account any verbal / written agreement, the surrounding circumstances of the case at all times just because the parties expressly profess to have intention to be partners, the court may decide to the contrary. No negation of partnership though no mention of partnership. Courts look into the business in common with the view Ratna Amal v. Tan Chow Soo Parties entered into an agreement to sell condensed milk called syndicated agreement. Division of prots - Arrangement to sell, rear and buy cattle whereby he would provide capital and the other would rear and sell the cattle and prots divided. Gulazam v. Noorzaman & Sobath Joint venture is not partnership Sinnathamby Klondakoundan v. Brijkishore the courts will look at the intention of the parties and sec. For them to be partners the joint venture between them must constitute a partnership for a single adventure or undertaking under sec. 34(1)(a). Liability of partnership to Outsiders (3rd party) Section 10 Notice If it has been agreed between the partners that any restriction shall be placed on the power of any one or more of them to bind the rm, no act done in contravention of the agreement is binding on the rm with respect to persons having notice of the agreement. Section 9 Where one partner pledges the credit of the rm for a purpose apparently not connected with the rms ordinary course of business, the rm is not bound, unless he is in fact specially authorized by the other partners; but this section does not a!ect any personal liability incurred by an individual partner. Higgins v Beauchamp one partner borrowed money from P stating it was for parnership but not. Cinema business not trading rm. No Express/implied authority Section 8 Whilst Sec 7 applies to partner, Sec 8 applies to partners AND non- partners is authorized. Eg : A cannot go to the court. 3rd party knows. Not binding on the rm. Partners bound by acts on behalf of rm An act or instrument relating to the business of the rm and done or executed in the rm-name, or in any other manner showing an intention to bind the rm, by any person thereto authorized, whether a partner or not, is binding on the rm and all the partners: Provided that this section shall not a!ect any general rule of law relating to the execution of deeds or negotiable instruments. Execute : signature Re Briggs Firm, father & son, son executed a deed of assignment, stating it was trading under rms name. Sec 8 applies Asamaju Enterprise v MBB Cheque given to D, but not indorsed by all partner Still bound if PA states person sign has the authority, here presence of 2 partners is su"cient Section 8 does not apply to undisclosed agency, because cannot know hes an agent or principle Authority Apparent/ostensible No actual authority is required, comes from representation Express Section 11 Contractual liability Every partner in a rm is liable jointly with the other partners for all debts and obligations of the rm incurred while he is a partner; and after his death his estate is also severally liable in a due course of administration for such debts and obligations, so far as they remain unsatised but subject to the prior payment of his separate debts. Father of all Section Section 7 Power of Partner to bind rm Every partner is an agent of the rm and his other partners for the purpose of the business of the partnership; and the acts of every partner who does any act for carrying on in the usual way business of the kind carried on by the rm of which he is a member bind the rm and his partners, unless the partner so acting has in fact no authority to act for the rm in the particular matter, AND the person with whom he is dealing either knows that he has no authority or does not know or believe him to be a partner. Requirements i) Usual way of business Mercantile Credit v Garrod Garage business, PA excluded buying/selling cars. One of the partners w/o authority sold a car Culture overrides PA. Sec 7 applies. Chan King Yue v Lee & Wong P borrowed money Held : borrowing money was not in the usual way business in electrical engineer rm. But however it was applied to pay pay debt of the rm (necessity). Vasu Devan v VA Nair A partner sell the partnership business by executing s/a agreement, and sale never went into partnership account. Not usual way in business. Sec 7 applies Polikinghorne v Holland Giving nancial advice is not the usual way for legal rm However the rm is bound to direct where to get such advice. Union Bank of Australia v Fisher Act must be necessary nor merely convenient Golgberg v Jenkins Lending rate too high, interest too high, not usual way of business Bank of Australia v Breillat ii) Partner does not have authority A is partner (conveyancing), B&C (litigation). A suka hati goes to court, negligent. Client sues A, A wants to use Sec 7. Client knows. Section 12 Tort/criminal Where, by any wrongful act or omission of any partner acting in the ordinary course of the business of the rm or with the authority of his co-partners, loss or injury is caused to any person not being a partner in the rm, or any penalty is incurred, the rm is liable therefor to the same extent as the partner so acting or omitting to act. Cricklewood v Quickgley Estate Realitites v Wignall None of the limbs apply, still liable. Justice. National Commercial Bank v Batty Conversion of cheques (theft), criminal. Hamlyn v Houston Sec 12 applies Clerk can get info legally, but because clerk bribed to do so, illegal. Korz v St Pierre Section 18 Notice to one, notice to all Liability 3rd Party v individual partner 3rd Party v Firm Section 14 Every partner is liable jointly with his co-partners and also severally for everything for which the rm while he is a partner therein becomes liable under section 12 or 13. Joint liability Sue once Joint & several liability Sue more than once RELATIONSHIP BETWEEN PARTNERS INTER-SE SECTION 26 SUBJECT TO PARTNERSHIP AGREEMENT (express or implied) and based on duciary duties sec 26(a) When the prots are not equally shared the losses are borne in the same proportion; regardless of capital contribution. Again this is subject to partnership agreement. Kilpatrick v. Mackay Both of the partners bought a hotel with K contributing the larger proportion. The hotel was used as joint business venture. When the hotel was sold the prots were shared equally and not in proportion to their initial contribution. Partnership Agreement IF NO PA, Business in common View of Prot Guidelines in Sec4 (a), joint tenancy b) gross return c) ii) Gaji Walker v Hirsch Clerk, 1/8 from prot & losses iii) Assignment of shares Also, iv) Loans Dooley v Drivers sec 26(b) Indemnify i) ada authority ii) necessary Prager v Blatspiel Sec 26(c) cannot communicate, doesnt have authority Capital advance Kilgarif v Moris Sec 26(d) Interest tak boleh potong gaji terus Rishton v Grissell Sec 26e) Every partner can manage, but still depends on PA Kelly v Tucker, or Gulazam Sec 26(f) buat gaji lebih, tak dapat, exception, the other partner neglects Re Noonan Sec 26(g) Burne v Reid Introduce son, can. PA says so Sec 26(h) Ordinary issue Simple majority Nature changed 100% Highley v Walker Son trained in rms workshop Cannot bad faith Const v Harris Dissenting partners were not informed of the purpose of changes Sec 26(i) Access to books