When does a partner become liable for a firm? What is an outgoing partner? Is the estate of insolvent partner liable?
However, the incoming partner may agree to be liable for debts prior to his admission. Such agreeing will not empower the prior creditor to sue the incoming partner.
But he is not liable for any obligation of the firm before his date of admission. An incoming partner is liable for all acts of the firm done after he becomes a partner. Liability of retiring partner. A retired or expelled partner will not be liable for any act of the firm after his retirement.
Thus, the liability of the new partner commences from the date of admission. He may, however, agree with his’ partners to be liable for the debts incurred up to the date of his. But such an agreement is binding only upon the partners.
A person who is admitted as a partner into an existing firm does not thereby become liable to the creditors of the firm for anything done before he became a partner.
Every partner is liable jointly with all the other partners and also severally for all the debts of the firm. (more…)