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- 15 Marks
Question
By a letter dated 18th February 2014, addressed to the Manager of their partnership firm, Kofi Nti informed the Management of his and Mrs. Obeng’s immediate retirement as partners. The Manager replied that their application was under consideration. However, by another letter dated 12th January 2015, Mr. Kofi Nti and Mrs. Obeng withdrew their letter dated 18th February 2014. The conduct of the remaining partners, however, showed that they considered the letter of 18th February 2014 to be of no effect, and continued the partnership accordingly. A dispute later arose and Jeff, one of the partners, obtained an order of the High Court directing Mr. Kofi Nti and Mrs. Obeng to submit themselves to arbitration in accordance with the partnership agreement. The arbitrator submitted to the court that by their letter dated 18th February 2014, Mr. Kofi Nti and Mrs. Obeng ceased as from that date to be partners as the said letter could not be recalled.
Required:
Explain whether by the provisions of the Incorporated Private Partnership Act, 1962 (Act 152), Mr. Kofi Nti and Mrs. Obeng remain partners in the firm after their letters of 18th February 2014 and 12th January 2015.
Answer
Under the provisions of the Incorporated Private Partnership Act, 1962 (Act 152), the following points apply to the scenario:
- Notification Requirement: Upon the retirement of a partner, the remaining partners must, within 28 days, notify the Registrar of Companies of the fact, as required by Section 7 of the Act.
- Registrar’s Duty: The Registrar is then required to amend the certificate of registration of the company and insert a notice in the Gazette signifying the change.
- No Compliance with Statutory Requirements: The remaining partners did not notify the Registrar of Companies following the letter of 18th February 2014. As a result, the original certificate of registration with the names of all the original partners remains unaltered.
- Conduct of the Partners: The conduct of the remaining partners showed that they treated the letter of 18th February 2014 as of no effect. By their actions, they seemed to agree that the letter should be ignored, and continued the partnership accordingly.
- Legal Standing of Partners: Due to the lack of compliance with the statutory requirements, and the conduct of the remaining partners, Mr. Kofi Nti and Mrs. Obeng remained partners in the firm after 18th February 2014. The letter of 12th January 2015, attempting to withdraw the previous letter, does not alter this fact.
Conclusion: Based on the provisions of the Incorporated Private Partnership Act, 1962 (Act 152), and the conduct of the remaining partners, Mr. Kofi Nti and Mrs. Obeng remained partners in the firm after their letters of 18th February 2014 and 12th January 2015.
(15 marks)
- Tags: Ghana, Legal obligations, Partnership, Retirement
- Level: Level 1
- Uploader: Dotse