Under the general legal principles governing general partnerships in Nigeria, what is the correct legal status regarding a retiring partner's liability for partnership debts contracted prior to retirement?

Question

Accepted Answer

The retiring partner remains liable for debts incurred prior to retirement unless discharged by an agreement of novation involving the partner, the reconstituted firm, and the creditors.. Under standard Partnership Law principles (Section 17 Partnership Act 1890 applicable in Nigeria), a retiring partner remains liable for debts incurred prior to retirement. Liberation from such pre-existing debts requires a tripartite agreement of novation between the creditor, the retiring partner,

Answer

A) The retiring partner is automatically discharged from all prior liabilities immediately upon serving a notice of retirement to co-partners.

Answer

B) The retiring partner remains liable for debts incurred prior to retirement unless discharged by an agreement of novation involving the partner, the reconstituted firm, and the creditors.

Answer

C) The retiring partner is only liable for prior debts if the remaining partners become insolvent within six months after retirement.

Answer

D) The retiring partner's liability automatically ceases upon filing notice of retirement with the Corporate Affairs Commission.

Under the general legal principles governing general partnerships in Nigeria, what is the correct legal status regarding a retiring partner's liability for partnership debts contracted prior to retirement?

Practice more Business Law questions