Mansi Airi Gambhir enrolled with the Delhi Bar Council in 2009 and holds Masters in Corporate Laws f... Read More
Personal Liability of Partners under Partnership
What is the personal liability of partners for the business obligations of the partnership?
- Sector-1, Noida
Partners are personally liable for the business obligations of the partnership. This means that if the partnership can't afford to pay creditors or the business fails, the partners are individually responsible to pay for the debts and creditors can go after personal assets such as bank accounts, cars, and even homes. For example, if the partnership dissolves and there are still outstanding debts to suppliers or lenders, those creditors can sue you personally to pay for the debts. Debts of the partnership will expose your personal assets to liability unless you're a limited partner, in which case your liability is limited to the money you've invested.
Answered on 28 Sep 2018
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