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Action to takeafter been expelled from firm on majority without notice
21-Sep-2023 (In Arbitration Law)
i m partner in reg firm in hospital ,dispute arise by me for mismanagement of hospital i gave notice for arbitration but by majority they expel me after my notice,legal.as per partnership deed majority can expel .without calling meeting or my consent.can they expel ,what is next step for me
Sir, you need to take immediate action by giving them a notice and take stay on their activities. They cannot do it without any notice and without giving you a chance to represent yourself. No arbitration can work like it. You must stop their illegal activity firmly.
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Dear Sir
Under the provisions of Partnership Act, if the contract so provides, then the Majority Partners can expel minority partner, provided such expelling is in GOOD FAITH. "GOOD FAITH" means expelling power has to be exercised by majority of the Partners in the interest of firm and provided there are reasons justifying such expelling. So, notwithstanding that the partnership deed provided such unilateral expelling clause, the partner are obliged under the Partnership law to act in good faith and not arbitrarily.
Now it appears that there is an arbitration clause in the Partnership Deed and you have already invoked arbitration clause, so the next step for you should be (1) File Application u/s 9 of the Arbitration & Concilliation Act, 1996 for interim relief to the effect of staying the resolution of expelling and restraining the other partners to not restrain from acting as partner of the firm, (2) File application u/s 11 of the Arbitration Act, for appointment of Arbitrator for resolution of dispute.
The aforesaid opinion is based on the limited facts made available to me. For detailed advice and opinion, entire case paper needs to pursed. Feel free to contact should you have any questions
Under the provisions of Partnership Act, if the contract so provides, then the Majority Partners can expel minority partner, provided such expelling is in GOOD FAITH. "GOOD FAITH" means expelling power has to be exercised by majority of the Partners in the interest of firm and provided there are reasons justifying such expelling. So, notwithstanding that the partnership deed provided such unilateral expelling clause, the partner are obliged under the Partnership law to act in good faith and not arbitrarily.
Now it appears that there is an arbitration clause in the Partnership Deed and you have already invoked arbitration clause, so the next step for you should be (1) File Application u/s 9 of the Arbitration & Concilliation Act, 1996 for interim relief to the effect of staying the resolution of expelling and restraining the other partners to not restrain from acting as partner of the firm, (2) File application u/s 11 of the Arbitration Act, for appointment of Arbitrator for resolution of dispute.
The aforesaid opinion is based on the limited facts made available to me. For detailed advice and opinion, entire case paper needs to pursed. Feel free to contact should you have any questions
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Adv. Vivek Mapara
Ahmedabad | 100+ Answers
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