What is Implied Authority of a Partner?
Implied Authority of a Partner 1. Authority of a Partner: The Authority of a partner to bind the firm in the context of third parties may be express or implied. Express Authority: Authority is said to be express when it is given by words, spoken or written. Thus, the authority conferred on a partner by mutual agreement is called an express authority. The firm is bound by all acts of a partner done within the scope of his express authority, notwithstanding that the acts are beyond the scope of the partnership business. Implied Authority: Also known as ostensible or apparent authority, implied authority is derived from either usage of trade, conduct of parties, or statute. It arises by implication of law and is not conferred by express agreement among the partners. 1.1. Doctrine and Scope of Implied Authority: Section 19 provides, ‘Subject to the provisions of Section 22, the act of a partner which is done to carry on, in the usual way, business of the kind ...