In which of the following cases, a partner may cease to be a partner without the dissolution of the firm?
A partner may retire under section 32 without the firm being dissolved. Under section 34 an insolvent partner ceases to be a partner, and under section 42 death or…
Choose your answer
In which of the following cases, a partner may cease to be a partner without the dissolution of the firm?
Answer and explanation
Correct answer D
A partner may retire under section 32 without the firm being dissolved. Under section 34 an insolvent partner ceases to be a partner, and under section 42 death or insolvency dissolves the firm only subject to a contract between the partners, which may provide for the firm to continue. So each listed event can end a person's membership without dissolving the firm.
Current law: The distinction between a partner’s departure and dissolution of the firm remains.
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