What do you mean by Partnership Liability

Question

What do you mean by Partnership Liability?

Answer 1

Each partner becomes the agent of the other partners. Therefore, actions taken by one partner bind all of the partners. Although partners may wish to restrict authority by an internal agreement, such restrictions are only binding on third parties who have actual notice of the restrictions. As well, each partner owes a fiduciary duty to the other partners, i.e., a responsibility to perform honesty same as in good faith with an observation to the best interests of partnership. Another key feature of a partnership is joint and several liabilities, which means that each partner is individually as well as collectively responsible for the entire debt.