For two years after a partner dissociates from a continuing partnership,the partnership may be bound by the acts of the dissociated partner based on apparent authority.

Question

Quizplus · Accepted Answer

This is true as per the Uniform Partnership Act (UPA) section 503, which states that any act done by a partner with third parties within the ordinary course of business after dissociating can still bind the partnership. This is because the partnership may have created an impression of continued authority of the dissociated partner, leading the third party to believe that the partner still has the power to act on behalf of the partnership.

For Two Years After a Partner Dissociates from a Continuing