Business law environment Essay Example | Topics and Well Written Essays - 1500 words

Business law environment - Essay Example Thus, both Andrew and Ivor are principals with respect to third parties, agents with respect to each other, and have equal rights and duties owing from being part of a fiduciary relationship. 2 The inherent fiduciary nature of partnership entails that good faith characterise all the actions of both Andrew and Ivor relative to Hi-Tek Kitchenware transactions. This is because in a fiduciary relationship a partner is entrusted with the obligation to act for the benefit of the other, implying that Andrew must act for the benefit of Ivor and Ivor, on the hand, must act only, in transactions related to the firm, with the benefit of Andrew in mind. Thus under ss 28 to 30 of PA 1890, the duties and obligations of partners all embrace this element. In the duty of disclosure, under s 28 of the said Act, obligates a partner to reveal all and every transaction that he entered into in behalf of the other partners. 3 Both Andrew and Ivor therefore, are required under this provision of the Act to disclose to each other all transactions and negotiations they entered into in their capacity as agent of each other. In the landmark case, for example, of Law v. Law 4 a partner offered to purch ase another partner’s share of the firm to which the latter accepted. He found out belatedly however, after the sale, that the partner to whom he sold his share had failed to disclose certain assets of the firm. When the case was brought to court, the latter held that the duty to disclose is an obligation that each partner must carry out although in this case, the sale was not annulled because it turned out that the selling partner had agreed to a sale without prior disclosure. 5 Another duty of a partner to each other is the duty to account which comes under s 29 of PA 1890. Under the said section, Andrew and Ivor are duty-bound to account to each other all profits or benefits of any kind they gained from all