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CA Intermediate · Corporate and Other Laws · The Limited Liability Partnership Act, 2008

Gopal, a partner of Harbour Traders LLP, dies. The LLP agreement has no provision on the death of a partner. His son Ishan wishes to become a partner in his place. What is the position under the LLP Act, 2008?

Ishan does not become a partner automatically. The LLP continues despite Gopal's death, and a person becomes a partner only by agreement with the other partners or under the LLP agreement. Gopal's estate may still receive his share of profits.

  1. AIshan automatically becomes a partner as Gopal's legal heir
  2. BThe LLP is dissolved on Gopal's death
  3. CIshan can become a partner only with the consent of the other partners, though the LLP continues, and his estate may be entitled to Gopal's share of the economic rightsCorrect
  4. DIshan becomes a partner if he gives a notice of 30 days to the Registrar

Explanation

The death of a partner does not dissolve the LLP, which has perpetual succession. A person becomes a partner only by agreement with the existing partners or as per the LLP agreement, so Ishan needs the consent of the others. The rights to share profits are transferable, so the estate keeps the economic entitlement but not management rights.

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