PRC-3 · Chapter 2 · Question 25 of 61
Three friends form a general partnership to run a logistics firm. Tragically, one of the partners passes away unexpectedly. In the absence of a specific legal agreement stating otherwise, what generally happens to the partnership?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) It is legally dissolved and must be reconstituted by the remaining partners
Explanation
A general partnership lacks perpetual succession. The death, bankruptcy, or withdrawal of a partner typically dissolves the legal structure of the partnership.
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