Types of Partnership Business as Duration, Representation, and Publicity
When two or more persons agreed to form a business and run by them with a view to earning the profit is called partnership business. In the broad sense, partnership business is one which formed by two to twenty persons but in case of the banking business, it is two to ten based on a mutual agreement for the sake of earning a profit.
As to duration:
- Partnership at will: One in which no time is specified and is not formed for a particular undertaking or venture which may be terminated anytime by mutual agreement or consent.
- Partnership with a fixed term: The term for which the partnership is to exist fixed or agreed upon or one formed for a particular undertaking.
As to representation to others:
- Ordinary or real partnership: One which actually exists among the partners and also as to 3rd persons
- Ostensible or partnership by estoppel: One which in reality is not a partnership but is considered a partnership only in relation to those who, by their conduct or omission, are precluded to deny or disprove its existence.
As to publicity:
- Secret partnership: One wherein the existence of certain persons as partners is not avowed or made known to the public by any of the partners.
- Open to notorious partnership: One whose existence is avowed or made known to the public by the members of the firm.
- Commercial or trading partnership: One formed for the transaction of business.
- Professional or non-trading partnership: One formed for the exercise of a profession.