Limited Liability Partnership or in short LLP is a kind of partnership in which, as the name says, has limited partnership rights and liabilities.
General Duties of the partners in LLP:
The foremost thing in any of these kinds of partnerships is the trust factor among every partner. No one should withhold any information pertaining to the company/firm because that can affect the other partners.
To compensate for any fraud caused to the firm:
If any fraud or loss is caused to the company and the partnership as a whole due to a partner, then that particular individual has to compensate for the loss.
The entitlements that every partner gets in an LLP:
There are rights that every partner in a partnership is entitled to. They are as follows:
- In every business affair/deal, each and every partner is entitled to have a say.
- It is required of every partner to be present and perform his/her duties efficiently regarding business affairs.
- In business, there is always a difference in opinion regarding many business matters among the partners be it small or big. Each one of them is entitled to put forth their opinion. After every opinion is taken the majority of the partners will take the decision.
- In any partnership firm, every partner has the right to take a look at the accounts of the LLP.
- If there is a mishap, for example, the death of a partner. Then the heir/legally appointed individual of that person will take over the position.
The usual way to carry on business in the Limited Liability Partnership is by giving a partner of the LLP the authority to bind the company/partnership. But if there is no one who has authority then the partner is not entitled to some powers such as:
- He or she is not entitled to open an account in any bank with their name on behalf of the firm/LLP.
- They cannot file a case/suit against anyone for the company by themselves. It will have to be the decision of the whole LLP.
- They cannot purchase any land or property for the company individually. Also, they cannot sell any property of the company individually.
Any property belonging to the Limited Liability Partnership whether physical or non-physical belongs to the firm as a whole and not individually to the partners. Therefore all the properties are to be used for business purposes only.