CAF-4 · Chapter 13 · Question 5 of 10
Which of the following actions is a partner NOT empowered to do under their 'implied authority'?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Transfer immovable property belonging to the firm.
Explanation
A partner's implied authority does not extend to acquiring or transferring immovable property on behalf of the firm without express authorization from the other partners.
More Relations of partners to third parties MCQs
- Q7Abid, a partner in FS, signs a contract with a third party. One month later, Haris joins FS as a new partner. Is Haris liable to the third…
- Q8If a partner retires from a firm but the firm continues its business, what must the retiring partner do to avoid liability for the firm's…
- Q9Can a minor who is admitted to the benefits of a partnership sue the other partners for their share of the profits while they are still a…
- Q10Under the principle of 'holding out', if a person who is not a partner verbally represents to a third party that they are a partner, and…
- Q1What is the foundational principle regarding a partner's relationship with third parties in the conduct of the firm's business?