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PARTNERSHIP ACT

CHAPTER 81:02

LAWS OF TRINIDAD AND TOBAGO

Current Authorised PagesPages Authorised

(inclusive) by L.R.O.1–21 ..

L.R.O.

Act30 of 1913

UNOFFICIAL VERSION

UPDATED TO DECEMBER 31ST 2015

MINISTRY OF THE ATTORNEY GENERAL AND LEGAL AFFAIRS www.legalaffairs.gov.tt


2 Chap. 81:02 Partnership

Note on Subsidiary LegislationThis Chapter contains no subsidiary legislation.

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Partnership Chap. 81:02 3

CHAPTER 81:02

PARTNERSHIP ACT

ARRANGEMENT OF SECTIONS

SECTION

1. Short title.

2. Interpretation.

NATURE OF PARTNERSHIP

3. Definition of partnership.

4. Rules for determining existence of partnership.Sharing gross returns.Effect of sharing profits, etc.

5. Postponement of rights of person lending or selling in considerationof share of profits in case of bankruptcy.

6. Meaning of “firm”.

RELATIONS OF PARTNERS TO PERSONSDEALING WITH THEM

7. Power of partner to bind the firm.

8. Partners bound by acts on behalf of firm.9. Partners using credit of firm for private purposes.

10. Effect of notice that firm will not be bound by acts of partner.11. Liability of partners.12. Liability of the firm for wrongs of partners.13. Misapplication of money or property received for or in custody of

the firm.14. Liability for wrongs joint and several.15. Improper employment of trust property for partnership purposes.16. Persons liable by “holding out”.

17. Admissions and representations of partners.

18. Notice to acting partner to be notice to the firm.

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19. Liabilities of incoming and outgoing partners.

20. Revocation of continuing guaranty by change in firm.

RELATIONS OF PARTNERS TO ONE ANOTHER21. Variation by consent of terms of partnership.

22. Partnership property.

23. Property bought with partnership money.

24. Immovable property held as partnership property.

25. Procedure against partnership property for a partner’s separatejudgment debt.

26. Rules as to interests and duties of partners subject to special agreement.

27. Expulsion of partner.

28. Retirement from partnership at will.

29. Where partnership for a term is continued over, continuance on oldterms presumed.

30. Duty of partners to render accounts etc.

31. Accountability of partners for private profits.

32. Duty of partner not to compete with firm.

33. Rights of assignee of share in partnership.

DISSOLUTION OF PARTNERSHIP ANDITS CONSEQUENCES

34. Dissolution by expiration or notice.

35. Dissolution by bankruptcy, death or charge.

36. Dissolution by illegality of partnership.

37. Dissolution by the Court.

38. Rights of persons dealing with firm against apparent membersof firm.

39. Rights of partners to notify dissolution.

ARRANGEMENT OF SECTIONS—Continued

SECTION

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40. Continuing authority of partners for purposes of winding up.41. Rights of partners as to application of partnership property.42. Apportionment of premium where partnership prematurely dissolved.43. Rights where partnership dissolved for fraud or misrepresentation.44. Right of outgoing partner in certain cases to share profits made after

dissolution.45. Retiring or deceased partner’s share to be a debt.46. Rule for distribution of assests on final settlement of accounts.47. Existing rules applicable to partnership.

SECTION

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CHAPTER 81:02

PARTNERSHIP ACT

An Act to declare the Law of Partnership.

[1ST JANUARY 1914]

1. This Act may be cited as the Partnership Act.

2. In this Act—“business” includes every trade, occupation, or profession;“Court” means the High Court;“Judge” means any Judge of the Court.

NATURE OF PARTNERSHIP

3. (1) Partnership is the relation which subsists betweenpersons carrying on a business in common with a view of profit.

(2) But the relation between members of any company orassociation which is—

(a) registered as a company under the Companies Actor any other written law for the time being in forceand relating to the registration of companies; or

(b) formed or incorporated by or in pursuance of anyother written law or of any Order in Council orAct of the United Kingdom, or Letters Patent, orCharter of the British Crown,

is not a partnership within the meaning of this Act.

4. In determining whether a partnership does or does not exist,regard shall be had to the following rules:

(a) joint tenancy, tenancy in common, joint property,common property or part ownership, does not ofitself create a partnership, as to anything so heldor owned, whether the tenants or owners do ordo not share any profits made by the use thereof;

1950 Ed.Ch. 31. No. 2.30 of 1913.Commencement.

Short title.

Interpretation.

Definition ofpartnership.

Ch. 81:01.

Rules fordeterminingexistence ofpartnership.

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(b) the sharing of gross returns does not of itself createa partnership, whether the persons sharing thereturns have or have not a joint or common rightor interest in any property from which, or fromthe use of which, the returns are derived;

(c) the receipt by a person of a share of the profits of abusiness is prima facie evidence that he is a partnerin the business, but the receipt of such a share, orof a payment contingent on or varying with theprofits of a business, does not of itself make him apartner in the business; and in particular—

(i) the receipt by a person of a debt or otherliquidated amount by instalments orotherwise, out of the accruing profits of abusiness, does not of itself make him apartner in the business or liable as such;

(ii) a contract for the remuneration of a servantor agent of a person engaged in a businessby a share of the profits of the business doesnot of itself make the servant or agent apartner in the business or liable as such;

(iii) a person being a widow or child of adeceased partner and receiving by way ofannuity a portion of the profits made in thebusiness in which the deceased person wasa partner, is not, by reason only of the receipt,a partner in the business or liable as such;

(iv) the advance of money by way of loan to aperson engaged, or about to engage, in anybusiness on a contract with that person thatthe lender shall receive a rate of interestvarying with the profits, or shall receive ashare of the profits arising from carryingon the business, does not of itself makethe lender a partner with the person orpersons carrying on the business or liableas such; provided that the contract is inwriting, and signed by or on behalf of allthe parties thereto;

Sharing grossreturns.

Effect of sharingprofits, etc.

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(v) a person receiving, by way of annuity orotherwise, a portion of the profits of abusiness in consideration of the sale by himof the goodwill of the business, is not, byreason only of the receipt, a partner in thebusiness or liable as such.

5. In the event of any person to whom money has beenadvanced by way of loan upon such a contract as is mentioned insection 4, or of any buyer of a goodwill in consideration of ashare of the profits of the business, being adjudged a bankrupt,entering into an arrangement to pay his creditors less than onehundred cents in the dollar, or dying in insolvent circumstances,the lender of the loan shall not be entitled to recover anything inrespect of his loan, and the seller of the goodwill shall not beentitled to recover anything in respect of the share of profitscontracted for, until the claims of the other creditors of theborrower or buyer for valuable consideration in money or money’sworth have been satisfied.

6. Persons who have entered into partnership with oneanother are, for the purposes of this Act, called collectively afirm, and the name under which their business is carried on iscalled the firm-name.

RELATIONS OF PARTNERS TO PERSONS DEALINGWITH THEM

7. Every partner is an agent of the firm and his otherpartners for the purpose of the business of the partnership; andthe acts of every partner who does any act for carrying on inthe usual way business of the kind carried on by the firm ofwhich he is a member, bind the firm and his partners, unlessthe partner so acting has in fact no authority to act for the firmin the particular matter, and the person with whom he is dealingeither knows that he has no authority, or does not know orbelieve him to be a partner.

Postponement ofrights of personlending orselling inconsideration ofshare of profitsin case ofbankruptcy.

Meaning of“firm”.

Power of partnerto bind the firm.

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8. An act or instrument relating to the business of the firm,and done or executed in the firm-name, or in any other mannershowing an intention to bind the firm, by any person theretoauthorised, whether a partner or not, is binding on the firm andall the partners except that this section shall not affect anygeneral rule of law relating to the execution of deeds ornegotiable instruments.

9. Where one partner pledges the credit of the firm for apurpose apparently not connected with the firm’s ordinary courseof business, the firm is not bound, unless he is in fact speciallyauthorised by the other partners; but this section does not affectany personal liability incurred by an individual partner.

10. If it has been agreed between the partners that anyrestriction shall be placed on the power of any one or more ofthem to bind the firm, no act done in contravention of theagreement is binding on the firm with respect to persons havingnotice of the agreement.

11. Every partner in a firm is liable jointly with the otherpartners for all debts and obligations of the firm incurred while heis a partner; and after his death his estate is also severally liable ina due course of administration for the debts and obligations, so faras they remain unsatisfied, but subject to the prior payment of hisseparate debts.

12. Where, by any wrongful act or omission of any partneracting in the ordinary course of the business of the firm, or withthe authority of his co-partners, loss or injury is caused to anyperson not being a partner in the firm, or any penalty is incurred,the firm is liable therefor to the same extent as the partner so actingor omitting to act.

13. In the following cases, namely:(a) where one partner, acting within the scope of his

apparent authority, receives the money or propertyof a third person, and misapplies it; and

Partners boundby acts onbehalf of firm.

Partners usingcredit of firm forprivatepurposes.

Effect of noticethat firm willnot be bound byacts of partner.

Liability ofpartners.

Liability of thefirm for wrongsof partners.

Misapplicationof money orpropertyreceived for orin custody ofthe firm.

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(b) where a firm in the course of its business receivesmoney or property of a third person, and themoney or property so received is misapplied byone or more of the partners while it is in thecustody of the firm,

the firm is liable to make good the loss.

14. Every partner is liable jointly with his co-partners and alsoseverally for everything for which the firm, while he is a partnertherein, becomes liable under either section 12 or 13.

15. If a partner, being a trustee, improperly employs trustproperty in the business or on the account of the partnership, noother partner is liable for the trust property to the personsbeneficially interested therein; but—

(a) this section shall not affect any liability incurredby any partner by reason of his having notice of abreach of trust; and

(b) nothing in this section shall prevent trust moneyfrom being followed and recovered from the firmif still in its possession or under its control.

16. (1) Everyone who by words spoken or written or byconduct represents himself, or who knowingly suffers himself tobe represented, as a partner in a particular firm, is liable as a partnerto anyone who has, on the faith of any such representation, givencredit to the firm, whether the representation has or has not beenmade or communicated to the person so giving credit by or withthe knowledge of the apparent partner making the representationor suffering it to be made.

(2) Where, after a partner’s death, the partnership businessis continued in the old firm-name, the continued use of that nameor of the deceased partner’s name as part thereof shall not of itselfmake his executor’s or administrator’s estate or effects liable forany partnership debts contracted after his death.

Liability forwrongs jointand several.

Improperemployment oftrust propertyfor partnershippurposes.

Persons liableby “holdingout”.

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17. An admission or representation made by any partnerconcerning the partnership affairs, and in the ordinary course ofits business, is evidence against the firm.

18. Notice to any partner who habitually acts in the partnershipbusiness of any matter relating to partnership affairs operates asnotice to the firm, except in the case of a fraud on the firmcommitted by or with the consent of that partner.

19. (1) A person who is admitted as a partner into an existingfirm does not thereby become liable to the creditors of the firm foranything done before he became a partner.

(2) A partner who retires from a firm does not therebycease to be liable for partnership debts or obligations incurredbefore his retirement.

(3) A retiring partner may be discharged from anyexisting liabilities by an agreement to that effect between himselfand the members of the firm as newly constituted and thecreditors, and this agreement may be either express or inferredas a fact from the course of dealing between the creditors and thefirm as newly constituted.

20. A continuing guaranty or cautionary obligation given eitherto a firm or to a third person in respect of the transactions of a firmis, in the absence of agreement to the contrary, revoked as to futuretransactions by any change in the constitution of the firm to which,or of the firm in respect of the transactions of which, the guarantyor obligation was given.

RELATIONS OF PARTNERS TO ONE ANOTHER

21. The mutual rights and duties of partners, whetherascertained by agreement or defined by this Act, may be varied bythe consent of all the partners, and the consent may be either expressor inferred from a course of dealing.

Admissions andrepresentationsof partners.

Notice to actingpartner to benotice to thefirm.

Liabilities ofincoming andoutgoingpartners.

Revocation ofcontinuingguaranty bychange in firm.

Variation byconsent of termsof partnership.

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22. (1) All property and rights and interests in propertyoriginally brought into the partnership stock or acquired, whetherby purchase or otherwise, on account of the firm, or for the purposesand in the course of the partnership business, are called in this Actpartnership property, and must be held and applied by the partnersexclusively for the purposes of the partnership and in accordancewith the partnership agreement.

(2) However, the legal estate or interest in any land whichbelongs to the partnership shall devolve according to the natureand tenure thereof and the general rules of law applicable thereto,but in trust, so far as necessary, for the persons beneficiallyinterested in the land under this section.

(3) Where co-owners of an estate or interest in any land,not being itself partnership property, are partners as to profits madeby the use of that land or estate, and purchase other land or estateout of the profits to be used in like manner, the land or estate sopurchased belongs to them, in the absence of an agreement to thecontrary, not as partners but as co-owners for the same respectiveestates and interests as are held by them in the land or estate firstmentioned at the date of the purchase.

23. Unless the contrary intention appears, property bought withmoney belonging to the firm is deemed to have been bought onaccount of the firm.

24. Where land or any heritable interest therein has becomepartnership property, it shall, unless the contrary intention appears,be treated as between the partners (including the representativesof a deceased partner) and also as between the next of kin of adeceased partner and his executors or administrators, as personaland not real or heritable estate.

25. (1) A writ of execution shall not issue against anypartnership property except on a judgment against the firm.

(2) The Court or a Judge may, on the application bysummons of any judgment creditor of a partner, make an ordercharging that partner’s interest in the partnership property andprofits with payment of the amount of the judgment debt and

Partnershipproperty.

Property boughtwith partnershipmoney.

Immovableproperty held aspartnershipproperty.

Procedureagainstpartnershipproperty for apartner’sseparatejudgment debt.

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interest thereon, and may by the same or a subsequent order appointa receiver of that partner’s share of profits (whether already declaredor accruing), and of any other money which may be coming tohim in respect of the partnership, and direct all accounts andenquiries, and give all other orders and directions which mighthave been directed or given if the charge had been made in favourof the judgment creditor by the partner, or which the circumstancesof the case may require.

(3) The other partner or partners shall be at liberty at anytime to redeem the interest charged, or, in case of a sale beingdirected, to purchase the same.

(4) Every summons by a judgment creditor under thissection shall be served on the judgment debtor and on his partnersor such of them as are within the jurisdiction, and the service shallbe good service on all the partners, and all orders made on thesummons shall be similarly served.

(5) Every application made by any partner of the judgmentdebtor under this section shall be made by summons which shallbe served on the judgment creditor and on the judgment debtorand on such of the other partners as shall not concur in theapplication and as shall be within the jurisdiction, and the serviceshall be good service on all the partners, and all orders made onthe summons shall be similarly served.

26. The interests of partners in the partnership property andtheir rights and duties in relation to the partnership shall bedetermined, subject to any agreement express or implied betweenthe partners, by the following rules:

(a) all the partners are entitled to share equally in thecapital and profits of the business and mustcontribute equally towards the losses whether ofcapital or otherwise sustained by the firm;

(b) the firm must indemnify every partner in respectof payments made and personal liabilities incurredby him—

(i) in the ordinary and proper conduct of thebusiness of the firm; or

Rules as tointerests andduties ofpartners subjectto specialagreement.

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(ii) in or about anything necessarily done forthe preservation of the business or propertyof the firm;

(c) a partner making, for the purpose of thepartnership, any actual payment or advancebeyond the amount of capital which he has agreedto subscribe, is entitled to interest at the rate ofsix per cent a year from the date of the paymentor advance;

(d) a partner is not entitled, before the ascertainment ofprofits, to interest on the capital subscribed by him;

(e) every partner may take part in the managementof the partnership business;

(f) no partner shall be entitled to remuneration foracting in the partnership business;

(g) no person may be introduced as a partner withoutthe consent of all existing partners;

(h) any difference arising as to ordinary mattersconnected with the partnership business may bedecided by a majority of the partners, but nochange may be made in the nature of thepartnership business without the consent of allexisting partners;

(i) the partnership books are to be kept at the placeof business of the partnership (or the principalplace, if there is more than one) and every partnermay, when he thinks fit, have access to and inspectand copy any of them.

27. No majority of the partners can expel any partner unless apower to do so has been conferred by express agreement betweenthe partners.

28. (1) Where no fixed term has been agreed upon for theduration of the partnership, any partner may determine thepartnership at any time on giving notice of his intention to do so toall the other partners.

Expulsion ofpartner.

Retirement frompartnership atwill.

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(2) Where the partnership has originally been constitutedby deed, a notice in writing, signed by the partner giving it, shallbe sufficient for this purpose.

29. (1) Where a partnership entered into for a fixed term iscontinued after the term has expired, and without any express newagreement, the rights and duties of the partners remain the same asthey were at the expiration of the term, so far as is consistent withthe incidents of a partnership at will.

(2) A continuance of the business by the partners or suchof them as habitually acted therein during the term, without anysettlement or liquidation of the partnership affairs, is presumed tobe a continuance of the partnership.

30. Partners are bound to render true accounts and fullinformation of all things affecting the partnership to any partneror his legal representatives.

31. (1) Every partner must account to the firm for any benefitderived by him without the consent of the other partners from anytransaction concerning the partnership, or from any use by him ofthe partnership property, name, or business connection.

(2) This section applies also to transactions undertakenafter a partnership has been dissolved by the death of a partner,and before the affairs thereof have been completely wound up,either by any surviving partner or by the representatives of thedeceased partner.

32. If a partner without the consent of the other partners carrieson any business of the same nature as and competing with that ofthe firm, he must account for and pay over to the firm all profitsmade by him in that business.

33. (1) An assignment by any partner of his share in thepartnership, either absolute or by way of mortgage or redeemablecharge, does not, as against the other partners, entitle the assignee,during the continuance of the partnership, to interfere in the

Wherepartnership for aterm iscontinued over,continuance onold termspresumed.

Duty of partnersto renderaccounts, etc.

Accountabilityof partners forprivate profits.

Duty of partnernot to competewith firm.

Rights ofassignee ofshare inpartnership.

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management or administration of the partnership business or affairs,or to require any accounts of the partnership transactions, or toinspect the partnership books, but entitles the assignee only toreceive the share of profits to which the assigning partner wouldotherwise be entitled, and the assignee must accept the account ofprofits agreed to by the partners.

(2) In case of a dissolution of the partnership, whether asrespects all the partners or as respects the assigning partner, theassignee is entitled to receive the share of the partnership assets towhich the assigning partner is entitled as between himself and theother partners, and, for the purpose of ascertaining that share, toan account as from the date of the dissolution.

DISSOLUTION OF PARTNERSHIP ANDITS CONSEQUENCES

34. Subject to any agreement between the partners, apartnership is dissolved—

(a) if entered into for a fixed term, by the expirationof that term;

(b) if entered into for a single adventure orundertaking, by the termination of that adventureor undertaking;

(c) if entered into for an undefined time, by anypartner giving notice to the other or others of hisintention to dissolve the partnership.

In the last-mentioned case the partnership is dissolved as fromthe date mentioned in the notice as the date of dissolution, or, ifno date is so mentioned, as from the date of the communicationof the notice.

35. (1) Subject to any agreement between the partners, everypartnership is dissolved as regards all the partners by the death orbankruptcy of any partner.

(2) A partnership may, at the option of the other partner,be dissolved if any partner suffers his share of the partnershipproperty to be charged under this Act for his separate debt.

Dissolution byexpiration ornotice.

Dissolution bybankruptcy,death or charge.

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Dissolution byillegality ofpartnership.

Dissolution bythe Court.

36. A partnership is in every case dissolved by thehappening of any event which makes it unlawful for the businessof the firm to be carried on or for the members of the firm tocarry it on in partnership.

37. On the application by a partner, the Court may decree adissolution of the partnership in any of the following cases:

(a) when a partner is found to be insane byinquisition, or is shown to the satisfaction of theCourt to be of permanently unsound mind, ineither of which cases the application may be madeas well on behalf of that partner by his committeeor next friend or person having title to interveneas by any other partner;

(b) when a partner, other than the partner suing,becomes in any other way permanentlyincapable of performing his part of thepartnership contract;

(c) when a partner, other than the partner suing, hasbeen guilty of such conduct as, in the opinion ofthe Court, regard being had to the nature of thebusiness, is calculated to prejudicially affect thecarrying on of the business;

(d) when a partner, other than the partner suing,wilfully or persistently commits a breach of thepartnership agreement or otherwise so conductshimself in matters relating to the partnershipbusiness that it is not reasonably practicable forthe other partner or partners to carry on thebusiness in partnership with him;

(e) when the business of the partnership can only becarried on at a loss;

(f) whenever in any case circumstances havearisen which, in the opinion of the Court,render it just and equitable that the partnershipbe dissolved.

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38. (1) Where a person deals with a firm after a change in itsconstitution he is entitled to treat all apparent members of the old firmas still being members of the firm until he has notice of the change.

(2) An advertisement in the Gazette shall be notice as topersons who had not dealings with the firm before the date of thedissolution or change so advertised.

(3) The estate of a partner who dies or who becomesbankrupt or of a partner who, not having been known to the persondealing with the firm to be a partner, retires from the firm, is notliable for partnership debts contracted after the date of the death,bankruptcy, or retirement respectively.

39. On the dissolution of a partnership or retirement of a partner,any partner may publicly notify the same and may require the otherpartner or partners to concur for that purpose in all necessary or properacts, if any, which cannot be done without his or their concurrence.

40. After the dissolution of a partnership the authority of eachpartner to bind the firm, and the other rights and obligations of thepartners, continue notwithstanding the dissolution so far as maybe necessary to wind up the affairs of the partnership, and tocomplete transactions begun but unfinished at the time of thedissolution, but not otherwise; except that the firm is in no casebound by the acts of a partner who has become bankrupt; but thisexception does not affect the liability of any person who has, afterthe bankruptcy, represented himself or knowingly suffered himselfto be represented as a partner of the bankrupt.

41. On the dissolution of a partnership every partner is entitled,as against the other partners in the firm, and all persons claimingthrough them in respect of their interests as partners, to have theproperty of the partnership applied in payment of the debts andliabilities of the firm; and to have surplus assets after the paymentapplied in payment of what may be due to the partners respectivelyafter deducting what may be due from them as partners to the firm;and for that purpose any partner or his representatives may, on thetermination of the partnership, apply to the Court to wind up thebusiness and affairs of the firm.

Rights ofpersons dealingwith firmagainst apparentmembers offirm.

Rights ofpartners tonotifydissolution.

Continuingauthority ofpartners forpurposes ofwinding up.

Rights ofpartners as toapplication ofpartnershipproperty.

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42. Where one partner has paid a premium to another onentering into a partnership for a fixed term and the partnership isdissolved before the expiration of that term otherwise than by thedeath of a partner, the Court may order the repayment of thepremium, or of such part thereof as it thinks just, having regard tothe terms of the partnership contract and to the length of time duringwhich the partnership has continued, unless—

(a) the dissolution is, in the judgment of the Court,wholly or chiefly due to the misconduct of thepartner who paid the premium; or

(b) the partnership has been dissolved by anagreement containing no provision for a returnof any part of the premium.

43. Where a partnership contract is rescinded on the groundof the fraud or misrepresentation of one of the parties thereto,the party entitled to rescind is, without prejudice to any otherright, entitled—

(a) to a lien on, or right of retention of, the surplus ofthe partnership assets, after satisfying thepartnership liabilities, for any sum of money paidby him for the purchase of a share in thepartnership and for any capital contributed byhim; and is

(b) to stand in the place of the creditors of the firmfor any payments made by him in respect of thepartnership liabilities; and

(c) to be indemnified by the person guilty of the fraudor making the representation against all the debtsand liabilities of the firm.

44. (1) Where any member of a firm has died or otherwiseceased to be a partner, and the surviving or continuing partnerscarry on the business of the firm with its capital or assets withoutany final settlement of accounts as between the firm and theoutgoing partner or his estate, then, in the absence of any agreementto the contrary, the outgoing partner or his estate is entitled at the

Apportionmentof premiumwherepartnershipprematurelydissolved.

Rights wherepartnershipdissolved forfraud ormisrepresentation.

Right ofoutgoing partnerin certain casesto share profitsmade afterdissolution.

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option of himself or his representatives to such share of the profitsmade since the dissolution as the Court may find to be attributableto the use of his share of the partnership assets or to interest at therate of six per cent a year on the amount of his share of thepartnership assets.

(2) Where, by the partnership contract, an option isgiven to surviving or continuing partners to purchase the interestof a deceased or outgoing partner, and that option is dulyexercised, the estate of the deceased partner, or the outgoingpartner or his estate, as the case may be, is not entitled to anyfurther or other share of profits; but if any partner assuming toact in exercise of the option does not in all material respectscomply with the terms thereof, he is liable to account under theabove provisions of this section.

45. Subject to any agreement between the partners, the amountdue from surviving or continuing partners to an outgoing partneror the representatives of a deceased partner in respect of theoutgoing or deceased partner’s share is a debt accruing at the dateof the dissolution or death.

46. In settling accounts between the partners after a dissolutionof partnership, the following rules shall, subject to any agreement,be observed:

(a) losses, including losses and deficiencies of capital,shall be paid first out of profits, next out of capital,and lastly, if necessary, by the partnersindividually in the proportion in which they wereentitled to share profits;

(b) the assets of the firm, including the sums, if any,contributed by the partners to make up losses ordeficiencies of capital, shall be applied in thefollowing manner and order:

(i) in paying the debts and liabilities of the firmto persons who are not partners therein;

Retiring ordeceasedpartner’s shareto be a debt.

Rule fordistribution ofassets on finalsettlement ofaccounts.

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(ii) in paying to each partner rateably what isdue from the firm to him for advances asdistinguished from capital;

(iii) in paying to each partner rateably whatis due from the firm to him in respectof capital;

(iv) the ultimate residue, if any, shall be dividedamong the partners in the proportion inwhich profits are divisible.

47. The rules, legal and equitable, applicable to partnership atpresent in operation in Trinidad and Tobago, shall continue in forceexcept as far as they are inconsistent with the express provisionsof this Act.

Existing rulesapplicable topartnership.

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