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Art. 1833. Where The Dissolution Is Caused by The Act, Death or Insolvency of A Partner, Each

This document discusses the liability of partners after a partnership dissolution. It states that after dissolution, a partner can still bind the partnership for acts related to winding up partnership affairs or completing unfinished transactions, unless certain conditions apply. A partner's liability in these cases is limited to partnership assets if the partner was unknown or inactive in the business prior to dissolution. The partnership is not bound by a partner's acts after dissolution if the partnership was dissolved due to illegality, the partner became insolvent, or the partner lacked authority to wind up affairs.

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Ken Darryl Tagolgol
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309 views2 pages

Art. 1833. Where The Dissolution Is Caused by The Act, Death or Insolvency of A Partner, Each

This document discusses the liability of partners after a partnership dissolution. It states that after dissolution, a partner can still bind the partnership for acts related to winding up partnership affairs or completing unfinished transactions, unless certain conditions apply. A partner's liability in these cases is limited to partnership assets if the partner was unknown or inactive in the business prior to dissolution. The partnership is not bound by a partner's acts after dissolution if the partnership was dissolved due to illegality, the partner became insolvent, or the partner lacked authority to wind up affairs.

Uploaded by

Ken Darryl Tagolgol
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Art. 1833.

Where the dissolution is caused by the act, death or insolvency of a partner, each
partner is liable to his co-partners for his share of any liability created by any partner acting
for the partnership as if the partnership had not been dissolved unless:

1. The dissolution being by act of any partner, the partner acting for the partnership had
knowledge of the dissolution.

2. The dissolution being by the death or insolvency of a partner, the partner acting for the
partnership had knowledge or notice of the death or insolvency.

General Rule
If the cause of dissolution is the death, act, or insolvency of a partner, authority of a partner
to bind ceases upon the knowledge of the dissolution.

If dissolution is caused by act of one of parties, co-partners are also liable to contribute
towards a liability as if no dissolution has happened, provided that there is no notice or the
partner does not have knowledge of the dissolution.

Art. 1834. After dissolution, a partner can bind the partnership, except as provided in the
third paragraph of this article:

1. By any act appropriate for winding up partnership affairs or completing transactions


unfinished at dissolution.

2. By any transaction which would bind the partnership if dissolution had not taken place,
provided the other party to the transaction:

a. Had extended credit to the partnership prior to dissolution and had no knowledge or
notice of the dissolution.

b. Though he had not so extended credit, had nevertheless known of the partnership
prior to dissolution, and, having no knowledge or notice of dissolution, the fact of
dissolution had not been advertised in a newspaper of general circulation in the place
(or in each
place if more than one) at which the partnership business was regularly
carried on.

The liability of a partner under the first paragraph, No. 2, shall be satisfied out of
partnership assets alone when such partner had been prior to dissolution:

1. Unknown as a partner to the person with whom the contract is made.

2. So far unknown and inactive in partnership affairs that the business reputation of
the partnership could not be said to have been in any degree due to his
connection with it.

The partnership is in no case bound by any act of a partner after dissolution:

1. Where the partnership is dissolved because it is unlawful to carry on the


business, unless the act is appropriate for winding up partnership affairs.

2. Where the partner has become insolvent.

3. Where the partner has no authority to wind up partnership affairs; except by a


transaction with one who —

a. Had extended credit to the partnership prior to dissolution and had no


knowledge or notice of his want of authority.

b. Had not extended credit to the partnership prior to dissolution, and, having no
knowledge or notice of his want of authority, the fact of his want of authority
has not been advertised in the manner provided for advertising the fact of
dissolution in the first paragraph, No. 2 (b).

Nothing in this article shall affect the liability under article 1825 of any person who
after dissolution represents himself or consents to another representing him as a
partner in a partnership engaged in carrying on business.

General Rule
Dissolution terminates the authority of the partners to bind partnership.

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