21.

Partnership by estoppel

In some situations, based on your statements and/or conduct, the court will consider

you a partner even if you have not actually entered into a partnership agreement. 

Partnership by estoppel means that a person who is not technically a partner can be

held liable as a general partner would be for any debts and damages owed to a third
party

Example: He is a person who by his words spoken or written or conduct represents

himself as a partner. Such a partner becomes liable to those who advance money to the
firm under the impression that he is a partner in the firm. Suppose Mr. X, is not
a partner but he tells Mr.

Force Majeure

The term ‘force majeure’ has been defined in Black’s Law Dictionary, as ‘an event or
effect that can be neither anticipated nor controlled. It is a contractual provision
allocating the risk of loss if performance becomes impossible or impracticable,
especially as a result of an event that the parties could not have anticipated or
controlled.’ While force majeure has neither been defined nor specifically dealt with, in
Indian statutes, some reference can be found in Section 32 of the Indian contract
becomes void.

Example: War, riots, earthquakes, hurricanes, lightning, and explosions, for example,

are force majeure events. The term also includes energy blackouts, unexpected
legislation, lockouts, slowdowns, and strikes.
22.

Confidentiality clause

As per the Indian law, confidentiality clause or non disclosure clause in

a contract bounds two or more parties or all the involved parties to ensure and agree
that specific type of information that is furnished by one party or all the parties will
remain confidential

Importance of confidentiality clause:

Confidentiality clause plays a vital role when an individual or a company enters into an
agreement with other party/parties. It stands out to be an integral element particularly in
reseller agreements, license, technology, employment contracts, etc… The key
objective behind including this clause is to ascertain that both the parties involved in the
agreement will maintain secrecy and high levels of confidentiality. In order to seek legal
help with respect to confidentiality clause, it is advised to connect with either corporate
lawyer or legal consultant in Delhi, Mumbai, Chennai, Bangalore, Hyderabad, Pune,
Goa, Kolkata, Ahmadabad, Gurgaon and Noida.

 Jurisdiction clause

A jurisdiction clause should be included where the parties want all disputes arising
under their agreement to be determined by a particular national court or courts. A party
expressly submitting to the courts of a particular jurisdiction will find it difficult to argue
that those courts are not the appropriate forum for the trial of disputes. 

If there is no effective jurisdiction clause the correct forum for the determination of a
dispute will be decided by reference to rules of private international law. 1 This can cause
uncertainty and inconvenience and can lead to additional costs and delay in progressing
any proceedings.
 Arbitration clause
Arbitration can be voluntary (the parties agree to do it) or mandatory (required by law).
Most contract arbitration occurs because the parties included an arbitration
clause requiring them to arbitrate any disputes "arising under or related to" the contract

Example: Dispute Resolution:

All claims and disputes arising under or relating to this Agreement are to be settled by
binding arbitration with Arbitration Resolution Services (ARS). The parties expressly
agree to abide by any and all rules of ARS as found in their web site at
www.arbresolutions.com. In the event that a party fails to pay any award, the award
may be converted to judgment in a Court of competent jurisdiction.

23.

A partnership is an association of two or more persons, who agree to combine their

financial resources and managerial abilities to run a business and share profits in an
agreed ratio.

1. Active partners

The partners who actively participate in the day-to-day operations of the business are
known as active or working partners.

They contribute capital and are also entitled to share the profits of the business. They
are also liable for the debts of the firm.

2. Dormant partners

Those partners who do not participate in the day-to-day activities of the partnership firm
are known as dormant or sleeping partners.

They only contribute capital and share the profits or bear the losses, if any.

3. Nominal partners
 These partners only allow the firm to use its name as a partner. They do not have any
real interest in the business of the firm. They do not invest any capital or share profits
and also do not take part in the conduct of the business of the firm.

4. Minor as a partner

You learned that a minor, i.e., a person under 18 years of age is not eligible to become
a partner. However, in special cases, a minor can be admitted as a partner with certain
conditions.

A minor can only share the profit of the business. In case of loss, his liability is limited to
the extent of his capital contribution to the business.

5. Partner by estoppels

If a person falsely represents himself as a partner of any firm or behaves in a way that
somebody can have an impression that such person is a partner and based on this
impression transacts with that firm then that person is held liable to the third party, the
person who falsely represents himself as a partner is known as a partner by estoppels.

Example:Suppose in A-firm there are two partners. One is David, and the other is
Moses.

If John- an outsider represents himself as a partner of A-firm and transacts with Lut,
then John will be held liable for any loss arising to Sharif. Here John is a partner by
estoppels.

6. Partner by holding out

In the above example, if either Linus or Shadhin declares that David is a partner of their
firm and knowing this declaration, David remains silent then will be liable to those
parties who suffer losses by transacting with A-firm with the belief that David is a partner
of that firm.
 Here David is liable to those parties who suffer losses, and David will be known as a
partner by holding out.

 General Partnership: In general partnership, liability of all partners is unlimited. ...

 Limited Partnership: In the case of limited, partnership, there are two categories
of partners: general partners and limited partners, also known as limited liability
partners.

There are three relatively common partnership types:

 General Partnership: ...

 Limited Partnership: ...

 Limited Liability Partnership: ...

 Public Private Partnership