Is there a Partner liability to third parties?
Derek and Errol conducted "Petals Florists"
in partnership. One clause of the partnership agreement provided that neither partner could pledge the firm's credit for artificial flowers without the prior consent of the other. Fergus who was not a partner was acquainted with Derek and Errol as he lived near the business premises.
In June this year, on his return from a delivery round, Errol called into "Fred's Electrical Wholesale" and purchased, on the firm's credit, a refrigerated display cabinet and a compact disc player.
Whilst Errol was away, Gene, a salesman of artificial flowers called at the firm's business premises. Gene understood Derek to be a sole trader. Derek purchased a quantity of artificial flowers from Gene.
On leaving the premises, Gene fractured his skull after slipping over due to water pooling on the floor after Derek had carelessly sprayed some flowers.
When Errol returned, Fergus asked to borrow the firm's delivery vehicle as his car had broken down. Fergus drove the delivery vehicle, which had on it large signs advertising "Petals", to a local garage and obtained four tyres to suit his own car. Fergus ensured that the garage owner saw him in the delivery vehicle and claiming to be a partner in the business, he persuaded the garage to send the account for the tyres to "Petals".
Relations between the partners Derek and Errol have broken down. Derek refuses to allow partnership funds to be used to pay for the goods supplied by Fred's Electrical Wholesale and Errol has the same attitude towards the artificial flowers purchased from Gene. They both refuse to pay the invoice received from the local garage. In addition, Gene has commenced legal proceedings against Derek and Errol for personal injury, alleging negligence.
All persons involved, what are their rights and obligations in respect of each event that has occurred.