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Recovery By A Partnership Firm Against Third Party
23-Jun-2025 (In Recovery Law)
Can a partnership firm having four partner having dispute Iin firm. Can a individual partner file a suit against third party for recovery without authorization with other partners
Individual partner filing suit against a third party without authorization: Generally, no. Under Section 69(2) of the Indian Partnership Act, 1932, an unregistered firm cannot file a suit to enforce a right arising from a contract against a third party. Even if the firm is registered, usually a suit is filed by or on behalf of the firm, and typically requires the consent or authorization of the other partners (or at least a majority for ordinary business matters as per the partnership agreement) to bind the firm. An individual partner suing without such authorization for a firm's claim would generally face challenges regarding the maintainability of the suit. However, there might be limited exceptions, such as suits for the dissolution of the firm, for accounts of a dissolved firm, or for certain statutory rights not arising from a contract.
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Adv. Mahrukh Khan
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