LAWS OF MALAYSIA
REPRINT
Act 135
PARTNERSHIP ACT 1961
Incorporating all amendments up to 1 January 2006
PUBLISHED BY
THE COMMISSIONER OF LAW REVISION, MALAYSIA
UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968
IN COLLABORATION WITH
PERCETAKAN NASIONAL MALAYSIA BHD
2006
Laws of Malaysia
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ACT 135
PARTNERSHIP ACT 1961
First enacted
... ... ... ... ... ... 1961 (Sabah Ord. No. 1
of 1961)
Revised
... ... ... ... ... ... ... 1974 (Act 135 w.e.f.
1 July 1974)
PREVIOUS REPRINTS
First Reprint
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...
...
...
...
1997
Second Reprint
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2000
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LAWS OF MALAYSIA
Act 135
PARTNERSHIP ACT 1961
ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY
Section
1.
Short title
2.
Interpretation
PART II
NATURE OF PARTNERSHIP
3.
Definition of partnership
Certain circumstances not prima facie partnerships
4.
5.
Postponement of rights of person lending or selling in consideration of
share of profits in case of bankruptcy
6.
Meaning of firm and firm name
PART III
RELATIONS OF PARTNERS TO PERSONS DEALING
WITH THEM
7.
Power of partner to bind firm
8.
Partners bound by acts on behalf of firm
9.
Partner using credit of firm for private purposes
10.
Effect of notice that firm will not be bound by acts of partner
11.
Liability of partners
12.
Liability of firm for wrongs
13.
Misapplication of money or property received for or in custody of firm
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ACT 135
Section
14.
Liability for wrongs joint and several
15.
Improper employment of trust property for partnership purposes
16.
Persons liable by "holding out"
17.
Admissions and representations of partner
18.
Notice to acting partner to be notice to firm
19.
Liability of incoming and outgoing partners
20.
Revocation of continuing guarantee by change in firm
PART IV
RELATIONS OF PARTNERS TO ONE ANOTHER
21.
Variation by consent of terms of partnership
22.
Partnership property
23.
Property bought with partnership money
24.
Conversion into personal estate of land held as partnership property
25.
Procedure against partnership property for partner's separate judgment
debt
26.
Rules as to interests and duties of partners, subject to special agreement
27.
Expulsion of partner
28.
Retirement from partnership at will
29.
Where partnership for term is continued over, continuance on old terms
presumed
Duty of partners to render accounts, etc.
30.
31.
Accountability of partners for private profits
32.
Duty of partner not to compete with firm
33.
Rights of assignee of share in partnership
PART V
DISSOLUTION OF PARTNERSHIP AND ITS
CONSEQUENCES
34.
Dissolution by expiration or notice
35.
Dissolution by bankruptcy, death or charge
36.
Dissolution by illegality of partnership
37.
Dissolution by the court
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Section
38.
Rights of persons dealing with firm against apparent members of firm
39.
Right of partner to notify dissolution
40.
Continuing authority of partners for purposes of winding up
41.
Rights of partners as to application of partnership property
42.
Apportionment of premium where partnership prematurely dissolved
43.
Rights where partnership dissolved for fraud or misrepresentation
44.
Rights of outgoing partner in certain cases to share profits made after
dissolution
45.
Retiring or deceased partner's share to be a debt
46.
Rules for distribution of assets on final settlement of accounts
47.
Savings
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ACT 135
Partnership
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LAWS OF MALAYSIA
Act 135
PARTNERSHIP ACT 1961
An Act relating to partnership.
[Sabah--29 April 1961;
Other States--1 July 1974, Act A240]
PART I
PRELIMANARY
Short title
This Act may be cited as the Partnership Act 1961.
1.
Interpretation
In this Act--
2.
"bankruptcy" means--
(a) being the subject of an order of adjudication under the
Bankruptcy Act 1967 [Act 360];
(b) entering into an arrangement to pay creditors less than
the full amount owed; or
(c) dying in insolvent circumstances;
"business" includes every trade, occupation, or profession.
PART II
NATURE OF PARTNERSHIP
Definition of partnership
3. (1) Partnership is the relation which subsists between persons
carrying on business in common with a view of profit.
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ACT 135
(2) The relation between members of any company or association
which is--
(a) registered as a company under the Companies Act 1965
[Act 125] or as a co-operative society under any written
law relating to co-operative societies; or
(b) formed or incorporated by or in pursuance of--
(i) any other law having effect in Malaysia or any
part thereof; or
(ii) any letters patent, Royal Charter or Act of the
Parliament of the United Kingdom,
is not a partnership within the meaning of this Act.
Certain circumstances not prima facie partnerships
4.  In determining whether a partnership does or does not exist,
regard shall be had to the following rules:
(a) joint tenancy, tenancy in common, joint property, common
property, or part ownership does not of itself create a
partnership as to anything so held or owned, whether the
tenants or owners do or do not share any profits made
by the use thereof;
(b) the sharing of gross returns does not of itself create a
partnership, whether the persons sharing such returns
have or have not a joint or common right or interest in
any property from which or from the use of which the
returns are derived;
(c) the receipt by a person of a share of the profits of business
is prima facie evidence that he is a partner in the business,
but the receipt of such a share, or of a payment contingent
on or varying with the profits of a business, does not of
itself make him a partner in the business; and in particular--
(i) the receipt by a person of a debt or other liquidated
amount, by instalments or otherwise, out of the
accruing profits of a business does not of itself
make him a partner in the business or liable as
such;
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(ii) a contract for the remuneration of a servant or
agent of a person engaged in a business by a share
of the profits of the business does not of itself
make the servant or agent a partner in the business
or liable as such;
(iii) a person being the widow or child of a deceased
partner, and receiving by way of annuity a portion
of the profits made in the business in which the
deceased person was a partner, is not, by reason
only of such receipt, a partner in the business or
liable as such;
(iv) the advance of money by way of loan to a person
engaged or about to engage in any business on a
contract with that person that the lender shall receive
a rate of interest varying with the profits, or shall
receive a share of the profits, arising from carrying
on the business, does not of itself make the lender
a partner with the person or persons carrying on
the business or liable as such:
Provided that the contract is in writing and signed
by or on behalf of all the parties thereto; and
(v) a person receiving, by way of annuity or otherwise,
a portion of the profits of a business in consideration
of the sale by him of the goodwill of the business
is not, by reason only of such receipt, a partner
in the business or liable as such.
Postponement of rights of person lending or selling in
consideration of share of profits in case of bankruptcy
5. In the event of the bankruptcy of any person to whom money
has been advanced by way of loan upon such a contract as is
mentioned in subparagraph 4(c)(iv), or of any buyer of a goodwill
in consideration of a share of the profits of the business, the lender
of the loan shall not be entitled to recover anything in respect of
his loan, and the seller of the goodwill shall not be entitled to
recover anything in respect of the share of profits contracted for,
until the claims of other creditors of the borrower or buyer for
valuable consideration in money or money's worth have been
satisfied.
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ACT 135
Meaning of firm and firm name
6.  Persons who have entered into partnership with one another
are, for the purposes of this Act, called collectively a firm, and
the name under which their business is carried on is called the
firm name.
PART III
RELATIONS OF PARTNERS TO PERSONS DEALING
WITH THEM
Power of partner to bind firm
7.  Every partner is an agent of the firm and his other partners
for the purpose of the business of the partnership; and the acts of
every partner who does any act for carrying on in the usual way
business of the kind carried on by the firm of which he is a member
bind the firm and his partners, unless the partner so acting has in
fact no authority to act for the firm in the particular matter, and
the person with whom he is dealing either knows that he has no
authority or does not know or believe him to be a partner.
Partners bound by acts on behalf of firm
8.  An act or instrument relating to the business of the firm and
done or executed in the firm-name, or in any other manner showing
an intention to bind the firm, by any person thereto authorized,
whether a partner or not, is binding on the firm and all the partners:
Provided that this section shall not affect any general rule of law
relating to the execution of deeds or negotiable instruments.
Partner using credit of firm for private purposes
9.  Where one partner pledges the credit of the firm for a purpose
apparently not connected with the firm's ordinary course of business,
the firm is not bound, unless he is in fact specially authorized by
the other partners; but this section does not affect any personal
liability incurred by an individual partner.
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Effect of notice that firm will not be bound by acts of partner
10.  If it has been agreed between the partners that any restriction
shall be placed on the power of any one or more of them to bind
the firm, no act done in contravention of the agreement is binding
on the firm with respect to persons having notice of the agreement.
Liability of partners
11.  Every partner in a firm is liable jointly with the other partners
for all debts and obligations of the firm incurred while he is a
partner; and after his death his estate is also severally liable in a
due course of administration for such debts and obligations, so far
as they remain unsatisfied but subject to the prior payment of his
separate debts.
Liability of firm for wrongs
12.  Where, by any wrongful act or omission of any partner acting
in the ordinary course of the business of the firm or with the
authority of his co-partners, loss or injury is caused to any person
not being a partner in the firm, or any penalty is incurred, the firm
is liable therefor to the same extent as the partner so acting or
omitting to act.
Misapplication of money or property received for or in custody
of firm
In the following cases, namely:
13.
(a) where one partner, acting within the scope of his apparent
authority, receives the money or property of a third person
and misapplies it; and
(b) where a firm in the course of its business receives the
money or property of a third person, and the money or
property so received is misapplied by one or more of the
partners while it is in the custody of the firm,
the firm is liable to make good the loss.
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ACT 135
Liability for wrongs joint and several
14.  Every partner is liable jointly with his co-partners and also
severally for everything for which the firm while he is a partner
therein becomes liable under section 12 or 13.
Improper employment of trust property for partnership purposes
15.  If a partner, being a trustee, improperly employs trust property
in the business or on the account of the partnership, no other
partner is liable for the trust property to the persons beneficially
interested therein:
Provided as follows:
(a) this section shall not affect any liability incurred by any
partner by reason of his having notice of a breach of
trust; and
(b) nothing in this section shall prevent trust money from
being followed and recovered from the firm, if still in its
possession or under its control.
Persons liable by "holding out"
16.  Every one who by words spoken or written or by conduct
represents himself, or who knowingly suffers himself, to be
represented, as a partner in a particular firm is liable as a partner
to any one who has on the faith of any such representation given
credit to the firm, whether the representation has or has not been
made or communicated to the person so giving credit by or with
the knowledge of the apparent partner making the representation
or suffering it to be made:
Provided that where, after a partner's death, the partnership
business is continued in the old firm-name, the continued use of
that name or of the deceased partner's name as part thereof shall
not of itself make his executor's or administrator's estate or effects
liable for any partnership debts contracted after his death.
Admissions and representations of partner
17.  An admission or representation made by any partner concerning
the partnership affairs, and in the ordinary course of its business,
is evidence against the firm.
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Notice to acting partner to be notice to firm
18.  Notice to any partner who habitually acts in the partnership
business of any matter relating to partnership affairs operates as
notice to the firm, except in the case of a fraud on the firm
committed by or with the consent of that partner.
Liability of incoming and outgoing partners
19. (1) A person who is admitted as a partner into an existing
firm does not thereby become liable to the creditors of the firm
for anything done before he became a partner.
(2) A partner who retires from a firm does not thereby cease
to be liable for partnership debts or obligations incurred before his
retirement.
(3) A retiring partner may be discharged from any existing
liabilities by an agreement to that effect between himself and the
members of the firm as newly constituted and the creditors, and
this agreement may be either express or inferred as a fact from the
course of dealing between the creditors and the firm as newly
constituted.
Revocation of continuing guarantee by change in firm
20.  A continuing guarantee given either to a firm or to a third
person in respect of the transactions of a firm is, in the absence
of agreement to the contrary, revoked as to future transactions by
any change in the constitution of the firm to which, or of the firm
in respect of the transactions of which, the guarantee was given.
PART IV
RELATIONS OF PARTNERS TO ONE ANOTHER
Variation by consent of terms of partnership
21.  The mutual rights and duties of partners, whether ascertained
by agreement or defined by this Act, may be varied by the consent
of all the partners, and such consent may be either express or
inferred from a course of dealing.
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ACT 135
Partnership property
22. (1) All property and rights and interests in property originally
brought into the partnership stock or acquired, whether by purchase
or otherwise, on account of the firm or for the purposes and in the
course of the partnership business, are called in this Act partnership
property and must be held and applied by the partners exclusively
for the purposes of the partnership and in accordance with the
partnership agreement:
Provided that the legal estate or interest in any land which
belongs to the partnership shall devolve according to the nature
and tenure thereof and the general rules of law applicable thereto
but in trust, so far as necessary, for the persons beneficially interested
in the land under this section.
(2) Where co-owners of an estate or interest in any land, not
being itself partnership property, are partners as to profits made
by the use of that land, and purchase other land out of the profits
to be used in like manner, the land so purchased belongs to them,
in the absence of any agreement to the contrary, not as partners,
but as co-owners for the same respective estates and interests as
are held by them in the land first mentioned at the date of the
purchase.
Property bought with partnership money
23.  Unless the contrary intention appears, property bought with
money belonging to the firm is deemed to have been bought on
account of the firm.
Conversion into personal estate of land held as partnership
property
24.  Where land or any interest therein has become partnership
property, it shall, unless the contrary intention appears, be treated
as between the partners (including the representatives of a deceased
partner), and also as between the heirs of a deceased partner and
his executors or administrators, as personal and not real estate.
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Procedure against partnership property for partner's separate
judgment debt
25. (1) A writ of execution shall not issue against any partnership
property except on a judgment against the firm.
(2) The court may on the application by summons of any judgment
creditor of a partner, make an order charging that partner's interest
in the partnership property and profits with payment of the amount
of the judgment debt and interest thereon, and may, by the same
or a subsequent order, appoint a receiver of that partner's share
of profits (whether already declared or accruing), and of any other
money which may be coming to him in respect of the partnership,
and direct all accounts and inquiries, and give all other orders and
directions, which might have been directed or given if the charge
had been made in favour of the judgment creditor by the partner,
or which the circumstances of the case may require.
(3) The other partner or partners shall be at liberty at any time
to redeem the interest charged, or, in case of a sale being directed,
to purchase the same.
Rules as to interests and duties of partners, subject to special
agreement
26.  The interests of partners in the partnership property, and
their rights and duties in relation to the partnership, shall be
determined, subject to any agreement, express or implied, between
the partners, by the following rules:
(a) all the partners are entitled to share equally in the capital
and profits of the business, and must contribute equally
towards the losses, whether of capital or otherwise,
sustained by the firm;
(b) the firm must indemnify every partner in respect of
payments made and personal liabilities incurred by him--
(i) in the ordinary and proper conduct of the business
of the firm; or
(ii) in or about anything necessarily done for the
preservation of the business or property of the
firm;
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ACT 135
(c) a partner making, for the purposes of the partnership, any
actual payment or advance beyond the amount of capital
which he has agreed to subscribe, is entitled to interest
at the rate of eight per cent per annum from the date of
the payment or advance;
(d) a partner is not entitled, before the ascertainment of profits,
to interest on the capital subscribed by him;
(e) every partner may take part in the management of the
partnership business;
(f) no partner shall be entitled to remuneration for acting in
the partnership business;
(g) no person may be introduced as a partner without the
consent of all existing partners;
(h) any difference arising as to ordinary matters connected
with the partnership business may be decided by a majority
of the partners, but no change may be made in the nature
of the partnership business without the consent of all
existing partners; and
(i) he partnership books are to be kept at the place of business
of the partnership (or the principal place, if there are
more places than one) and every partner may, when he
thinks fit, have access to and inspect and copy any of
them.
Expulsion of partner
27.  No majority of the partners can expel any partner, unless a
power to do so has been conferred by express agreement between
the partners.
Retirement from partnership at will
28. (1) Where no fixed term has been agreed upon for the duration
of the partnership, any partner may determine the partnership at
any time on giving notice of his intention to do so to all the other
partners.
(2) Where the partnership has originally been constituted by
written document, a notice in writing, signed by the partner giving
it, shall be sufficient for this purpose.
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Where partnership for term is continued over, continuance on
old terms presumed
29. (1) Where a partnership entered into for a fixed term is continued
after the term has expired, and without any express new agreement,
the rights and duties of the partners remain the same as they were
at the expiration of the term, so far as consistent with the incidents
of a partnership at will.
(2) A continuance of the business by the partners or such of
them as habitually acted therein during the term, without any
settlement or liquidation of the partnership affairs, is presumed to
be a continuance of the partnership.
Duty of partners to render accounts, etc.
30.  Partners are bound to render true accounts and full information
of all things affecting the partnership to any partner or his legal
representatives.
Accountability of partners for private profits
31. (1) Every partner must account to the firm for any benefit
derived by him, without the consent of the other partners, from any
transaction concerning the partnership or from any use by him of
the partnership property, name, or business connection.
(2) This section applies also to transactions undertaken after a
partnership has been dissolved by the death of a partner, and
before the affairs thereof have been completely wound up, either
by any surviving partner or by the representatives of the deceased
partner.
Duty of partner not to compete with firm
32.  If a partner, without the consent of the other partners, carries
on any business of the same nature as and competing with that of
the firm, he must account for and pay over to the firm all profits
made by him in that business.
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ACT 135
Rights of assignee of share in partnership
33. (1) An assignment by any partner of his share in the partnership,
either absolute or by way of mortgage or redeemable charge, does
not, as against the other partners, entitle the assignee, during the
continuance of the partnership, to interfere in the management or
administration of the partnership business or affairs, or to require
any accounts of the partnership transactions, or to inspect the
partnership books, but entitles the assignee only to receive the
share of the profits to which the assigning partner would otherwise
be entitled, and the assignee must accept the account of profits
agreed to by the partners.
(2) In the case of a dissolution of the partnership, whether as
respects all the partners or as respects the assigning partner, the
assignee is entitled to receive the share of the partnership assets
to which the assigning partner is entitled as between himself and
the other partners, and, for the purpose of ascertaining that share,
to an account as from the date of the dissolution.
PART V
DISSOLUTION OF PARTNERSHIP AND ITS CONSEQUENCES
Dissolution by expiration or notice
34. (1) Subject to any agreement between the partners, a partnership
is dissolved--
(a) if entered into for a fixed term, by the expiration of that
term;
(b) if entered into for a single adventure or undertaking, by
the termination of that adventure or undertaking; or
(c) if entered into for an undefined time, by any partner
giving notice to the other or others of his intention to
dissolve the partnership.
(2) In the last-mentioned case the partnership is dissolved as
from the date mentioned in the notice as the date of dissolution,
or, if no date is so mentioned, as from the date of the communication
of the notice.
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Dissolution by bankruptcy, death or charge
35. (1) Subject to any agreement between the partners, every
partnership is dissolved as regards all the partners by the death or
bankruptcy of any partner.
(2) A partnership may, at the option of the other partners, be
dissolved if any partner suffers his share of the partnership property
to be charged under this Act for his separate debt.
Dissolution by illegality of partnership
36.  A partnership is in every case dissolved by the happening of
any event which makes it unlawful for the business of the firm to
be carried on or for the members of the firm to carry it on in
partnership.
Dissolution by the court
37.  On application by a partner, the court may decree a dissolution
of the partnership in any of the following cases:
(a) when a partner is found lunatic or is shown, to the
satisfaction of the court, to be of permanently unsound
mind, in either of which cases the application may be
made as well on behalf of that partner by his committee,
or next friend, or person having title to intervene as by
any other partner;
(b) when a partner, other than the partner suing, becomes in
any other way permanently incapable of performing his
part of the partnership contract;
(c) when a partner, other than the partner suing, has been
guilty of such conduct as, in the opinion of the court,
regard being had to the nature of the business, is calculated
to affect prejudicially the carrying on of the business;
(d) when a partner, other than the partner suing, wilfully or
persistently commits a breach of the partnership agreement
or otherwise so conducts himself in matters relating to
the partnership business that it is not reasonably practicable
for the other partner or partners to carry on the business
in partnership with him;
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ACT 135
(e) when the business of the partnership can only be carried
on at a loss; and
(f) whenever in any case circumstances have arisen which,
in the opinion of the court, render it just and equitable
that the partnership be dissolved.
Rights of persons dealing with firm against apparent members
of firm
38. (1) Where a person deals with a firm after a change in its
constitution, he is entitled to treat all apparent members of the old
firm as still being members of the firm until he has notice of the
change.
(2) An advertisement in the Federal Gazette as to a firm whose
principal place of business is in Peninsular Mlaysia, in the Sabah
Gazette as to a firm whose principal place of business is in Sabah,
and in the Sarawak Gazette as to a firm whose principal place of
business is in Sarawak, shall be notice as to persons who had no
dealings with the firm before the date of the dissolution or change
so advertise.
(3) The estate of a partner who dies or who becomes bankrupt,
or of a partner who, not having been known to the person dealing
with the firm to be a partner, retires from the firm, is not liable
for partnership debts contracted after the date of the death, bankruptcy,
or retirement respectively.
Right of partner to notify dissolution
39.  On the dissolution of a partnership or retirement of a partner,
any partner may publicly notify the same, and may require the
other partner or partners to concur for that purpose in all necessary
or proper acts, if any, which cannot be done without his or their
concurrence.
Continuing authority of partners for purposes of winding up
40.  After the dissolution of a partnership, the authority of each
partner to bind the firm, and the other rights and obligations of
the partners, continue, notwithstanding the dissolution, so far as
may be necessary to wind up the affairs of the partnership, and
to complete transactions begun but unfinished at the time of the
dissolution, but not otherwise:
Provided that the firm is in no case bound by the acts of a
partner who has become bankrupt; but this provision does not
affect the liability of any person who has, after the bankruptcy,
represented himself or knowingly suffered himself to be represented
as a partner of the bankrupt.
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Rights of partners as to application of partnership property
41.  On the dissolution of a partnership, every partner is entitled,
as against the other partners in the firm and all persons claiming
through them in respect of their interests as partners, to have the
property of the partnership applied in payment of the debts and
liabilities of the firm, and to have the surplus assets after such
payment applied in payment of what may be due to the partners
respectively, after deducting what may be due from them as partners
to the firm; and for that purpose any partner or his representatives
may, on the termination of the partnership, apply to the court to
wind up the business and affairs of the firm.
Apportionment of premium where partnership prematurely
dissolved
42.  Where one partner has paid a premium to another on entering
into a partnership for a fixed term, and the partnership is dissolved
before the expiration of that term otherwise than by the death of
a partner, the court may order the repayment of the premium, or
of such part thereof as it thinks just, having regard to the terms
of the partnership contract and to the length of time during which
the partnership has continued; unless--
(a) the dissolution is, in the judgment of the court, wholly
or chiefly due to the misconduct of the partner who paid
the premium; or
(b) the partnership has been dissolved by an agreement
containing no provision for a return of any part of the
premium.
R i g h t s  where  partnership
dissolved
for
fraud
or
misrepresentation
43.  Where a partnership contract is rescinded on the ground of
the fraud or misrepresentation of one of the parties thereto, the
party entitled to rescind is, without prejudice to any other right,
entitled--
(a) to a lien on, or right of retention of, the surplus of the
partnership assets, after satisfying the partnership liabilities
for any sum of money paid by him for the purchase of
a share in the partnership and for any capital contributed
by him; and is
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ACT 135
(b) to stand in the place of the creditors of the firm for any
payments made by him in respect of the partnership
liabilities; and
(c) to be indemnified by the person guilty of the fraud or
making the representation against all the debts and liabilities
of the firm.
Rights of outgoing partner in certain cases to share profits
made after dissolution
44. Where any member of a firm has died or otherwise ceased to
be a partner, and the surviving or continuing partners carry on the
business of the firm with its capital or assets without any final
settlement of accounts as between the firm and the outgoing partner
or his estate, then, in the absence of any agreement to the contrary,
the outgoing partner or his estate is entitled, at the option of
himself or his representatives, to such share of the profits made
since the dissolution as the court may find to be attributable to the
use of his share of the partnership assets, or to interest at the rate
of eight per cent per annum on the amount of his share of the
partnership assets:
Provided that where, by the partnership contract, an option is
given to surviving or continuing partners to purchase the interest
of a deceased or outgoing partner, and that option is duly exercised,
the estate of the deceased partner or the outgoing partner or his
estate as the case may be, is not entitled to any further or other
share of profits; but if any partner assuming to act in exercise of
the option does not in all material respects comply with the terms
thereof, he is liable to account under the preceding provisions of
this section.
Retiring or deceased partner's share to be a debt
45. Subject to any agreement between the partners, the amount
due from surviving or continuing partners to an outgoing partner
or the representatives of a deceased partner in respect of the outgoing
or deceased partner's share is a debt accruing at the date of the
dissolution or death.
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Rules for distribution of assets on final settlement of accounts
46.  In settling accounts between the partners after a dissolution
of partnership, the following rules shall, subject to any agreement,
be observed:
(a) losses, including losses and deficiencies of capital, shall
be paid first out of profits, next out of capital and lastly,
if necessary, by the partners individually in the proportion
in which they were entitled to share profits; and
(b) the assets of the firm, including the sums, if any, contributed
by the partners to make up losses or deficiencies of capital,
shall be applied in the following manner and order:
(i) in paying the debts and liabilities of the firm to
persons who are not partners therein;
(ii) in paying to each partner rateably what is due
from the firm to him for advances as distinguished
from capital;
(iii) in paying to each partner rateably what is due
from the firm to him in respect of capital; and
(iv) the ultimate residue, if any, shall be divided among
the partners in the proportion in which profits are
divisible.
Saving
47. (1) The rules of equity and of common law applicable in
partnership shall continue in force, except so far as they are
inconsistent with the express provisions of this Act.
(2) Nothing in this Act shall be read to permit any association
of more than twenty persons to be formed or to carry on any
business in partnership contrary to paragraph 14(3)(b) of the
Companies Act 1965 [Act 125].
Laws of Malaysia
24
ACT 135
LAWS OF MALAYSIA
Act 135
PARTNERSHIP ACT 1961
LIST OF AMENDMENTS
Amending law
Short title
In force from
Sab. G.N.S.
Sabah, Sarawak dan Singapore
16-09-1963
129/1963
(State Constitutions) Order in
Council 1963
L.N. 458/1964
Modification of Laws
24-12-1964
(Partnership) (Sabah) Order
1964
Act A240
Partnership (Amendment) Act
01-07-1974
1974
Partnership
25
LAWS OF MALAYSIA
Act 135
PARTNERSHIP ACT 1961
LIST OF SECTIONS AMENDED
Section
Amending authority
In force from
Long Title
Act A240
01-07-1974
2
Act A240
01-07-1974
3
Act A240
01-07-1974
L.N. 458/1964
24-12-1964
28
Act A240
01-07-1974
38
Act A240
01-07-1974
DICETAK OLEH
PERCETAKAN NASIONAL MALAYSIA BERHAD,
KUALA LUMPUR
BAGI PIHAK DAN DENGAN PERINTAH KERAJAAN MALAYSIA