What is the duty of one partner in a firm to the other partners? A duty to be honest, obviously, and a duty to act in good faith. But is he liable for his own simple negligence in relation to the firm’s affairs? This liability may take the form of a claim by the firm against him, or a claim by himself for an indemnity or contribution from the other partners (s.24(2)(a) of the Partnership Act 1890), but the question is the same: should he or the firm bear the ultimate cost?
It can be argued that the duties of partners to one another, which are essentially duties of honesty rather than care, impliedly exclude liability for simple negligence within the firm. In Medforth v Blake [2000] Ch 86, CA, Sir R Scott V-C said that “the...
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