Implied Authority of a Partner

A clothing wholesaler in Crawford Market has three partners. One morning a supplier delivers ten lakh rupees of fabric that only one partner ordered. The other two say they never approved it and refuse to pay. The supplier says he dealt with a partner of the firm and expects the firm to pay. Who is right? The answer turns on how far one partner can bind the others without asking, which is the subject of implied authority.

In two minutes

Every partner is the agent of the firm for its business, and an act done in the usual way of carrying on business of the kind the firm carries on binds the firm, unless it is one of the eight acts that implied authority does not cover or the third party knows the authority has been restricted.

The rest of this chapter

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