Partnership
Step 1: Area of law.
The area of law in this particular case is that of partnership and in particular is Contractual liability
Step 2: Discussion of the law.
Partnership is defined as an ongoing contractual relationship between two or more people with a common view of making profits. Partnership comes with both advantages and disadvantages. The advantages include share losses, share of liability and share of capital. The disadvantages are share of profits, clash between partners when it comes to making major or minor decisions involving the firm (Parsons 2008).
The Partnership act (the act) states that if a partnership wants to bind then it should satisfy all the elements of s.26. The act states that one partner is an agent towards his other partner. Partners also limited to their powers as in partners by referring to a partners acts as being for the purpose of the business of the partnership.
The act under s.16 also states that all the partners in a firm are liable for obligations and all the debts while the partner exists in the partnership but after death of a partner, he will still be liable for the debts for a particular period of time.
The act under s.17 (1) which states that in case of any loss or injury that is caused to the third party by any co-partners or the business, the firm is liable for the loss.
The act under s.18(1) which states that when any money or property of the third party is received by one partner who is acting within the scope of his real or apparent authority in the partnership and it has been misapplied by the partner the whole firm is liable for the loss of the third party.
S.18 under the act states all partners in any partnership are liable for everything that happens during the operation of the firm.
Step 3: Application of