Rights and Liabilities of Minors in Partnership according to Sec. 30 by Dr. Satyendra Kumar Singh
Minors can be admitted to the benefits of partnership with the consent of all partners. They have rights to share property and profits, access firm accounts, and sue for accounts. However, minors have liabilities and limitations in partnership, where their share is initially liable for firm acts but can sever connection after attaining majority. Minors also have the option to become partners or sever connections upon reaching adulthood.
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POSITION OF MINOR ADMITTED TO THE BENEFITS OF PARTNERSHIP [SEC.30] BY DR. SATYENDRA KUMAR SINGH DEPARTMENT OF LAW H.C.P.G. COLLEGE, VARANASI.
MINORS ADMISSION TO THE BENEFITS OF PARTNERSHIP The relation of partnership arises from contract and not from status. A minor is incompetent to contract, his agreement is void and, therefore, he is incapable of becoming a partner in any partnership firm. Sec.30 lays down that a minor cannot be a partner in a firm, but, with the consent of all the partners , he may be admitted to the benefits of partnership.
RIGHTS OF A MINOR He may be admitted to the benefit of the partnership. He has a right to share the property and profits of the firm. He may have access to and inspect and copy, the accounts of the firm. He may sue for accounts on severing his connection with the firm. On attaining majority, he has the option of becoming a partner in the firm. On attaining majority, he is also the option of severing his connection with the firm. He is not personally liable for any acts of the firm during his minority.
LIABILITIES OF A MINOR Minor share is liable for the acts of the firm, but he has an option severing his connection with the firm within six months of his attaining majority or his obtaining knowledge that he had been admitted to the benefits of the partnership, whichever date later. If, on attaining majority, he elects to become a partner, he becomes personally liable to third parties for all acts of the firm. After attaining majority and before giving public notice, he may be liable for holding himself out as a partner.
MINORS DISABILITIES A minor cannot sue the partners for an account or payment of his share of the property or profits of the firm, except when severing his connection with the firm, and in such a case, the amount of a share is to be determined by a valuation made as possible in accordance the rules contained in section.48.
OPTION ON ATTAINING MAJORITY At any time within six months of his attaining majority, or of his obtaining knowledge that he had been admitted to the benefits of partnership, whichever date is later, such a person may give public notice under Sec.72 that he has elected to become, or that he has elected not to become, a partner in the firm, and such notice determines his position as regards the firm. In case he fails to give such notice, he becomes a partner in the firm on the expiry of the said period of six months.
EFFECT OF ELECTION BY MINOR A] If he elects to become a partner in the firm- i) his rights and liabilities vis-a-vis partners of the firm are concerned, they continue to be the same upto the date on which he becomes a partner. ii) towards the creditors of the firm, he becomes personally liable for all the acts of the firm, not from the date of his attaining majority, nor from the date of his becoming a partner but retrospectively from the date of his admission to the benefits of the partnership.
B] If he elects not to become a partner i) his rights and liabilities continue to be those of minor upto the date on which he gives public notice; ii) his share is not liable for any acts of the firm done after the date of notice; and iii) he is entitled to sue the partners for his share of the property and profits.
