Partnerships and Limited Liability Partnerships Assignment

Partnerships and Limited Liability Partnerships - Assignment Example Fiduciary implies a particular individual on whom extreme assurance and faith has been placed by another to handle and guard finance or possessions. It is referred to as an association where an individual is obliged to do something for the advantage of another individual5. It has been further added that there are three most important duties that arise where there exists such an association. The foremost is the duty or responsibility of loyalty which means the responsibility to do something on behalf and in support of the particular individual or body towards whom the responsibility is outstanding and not taking benefit of, or damaging, it or him. The second is the duty or responsibility of obedience which means the obligation and responsibility to do something inside the limits of the power of faith. The third is the duty or obligation of care which means the duty to do something cautiously. At times the obligation of disclosure of complete material information is stated as the fourt h duty6. These fiduciary duties relating to sections 33, 34 and 35 of the Partnership Act 19637. The only fiduciary responsibility for which a particular partner is indebted to the other existing partners and the partnership is the responsibility of loyalty or faithfulness and the responsibility of care. A particular partner’s responsibility or obligation of loyalty is restricted to provide accounts to the partnership regarding any kind of possessions, profit or advantage that has been obtained by that partner in carrying out the business of partnership or by using a property that is possessed by the firm and all the partners jointly and also to cease from transacting with the firm where he has been acting as a partner, as an unfavourable party or entering into a competition with the firm in the course of carrying out the business of partnership. Similarly, a partner’s obligation of care is restricted to abstaining from grossly negligent or irresponsible behavior, misb ehavior that was on purpose or for disobeying a law intentionally. These obligations might not be surrendered or disposed of in the agreement of partnership and in order to accomplish them, every individual partner ought to act time and again in relation to the responsibility of trust and fair dealing. These are pertinent to all the contracts as well as agreements of partnership. It is allowed for a partner to follow one’s own interests but it should be ensured that in the course of doing so, the above-mentioned responsibilities should not be violated8.