Q&As

Can a senior employee (for example a Practice Manager) bind a partnership by signing a supply contract? Could they (by implied authority/agency) bind each and every partner jointly and severally to the contract?

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Published on LexisPSL on 23/08/2017

The following Commercial Q&A provides comprehensive and up to date legal information covering:

  • Can a senior employee (for example a Practice Manager) bind a partnership by signing a supply contract? Could they (by implied authority/agency) bind each and every partner jointly and severally to the contract?

Can a senior employee (for example a Practice Manager) bind a partnership by signing a supply contract? Could they (by implied authority/agency) bind each and every partner jointly and severally to the contract?

This Q&A refers to a general partnership to which Partnership Act 1890 (PA 1890) applies (not an LLP) and a simple agreement (not a deed).

In the context of contract law, 'authority' is the power an agent has to affect the legal relations of its principal.

Where such authority exists, the agent will have the power to bind the principal to contract. Where such authority is absent, or the relevant act is outside the scope of the relevant authority, the contract will not be binding upon the principal. See Practice Note: Forming enforceable contracts—agent's authority to contract.

As a general partnership is not a separate legal entity a partnership cannot of itself make contracts. Any contract with a partnership is with the partners who comprise the partnership. A third party contracting with the partnership will want to ensure that all the partners are bound by the contract even if the contract itself is with one or two partners only. A partner in

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