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CA Foundation · Business Laws · The Limited Liability Partnership Act, 2008

Ishaan and Divya, partners of Greenleaf Exports LLP in Kochi, sign a contract with a buyer in the LLP's name. The buyer later asks whether the LLP can itself enforce the contract and be sued on it. What is the correct position?

The LLP can sue and be sued in its own name and can own property in its own name. This follows from its being a body corporate with perpetual succession and separate legal personality, so individual partners need not be impleaded as the parties.

  1. AOnly the individual partners can sue or be sued, not the LLP
  2. BThe LLP can sue and be sued in its own name, and hold property in its own nameCorrect
  3. CThe LLP can sue but cannot be sued, since partners are agents
  4. DThe LLP can sue and be sued only after all partners consent in writing

Explanation

As a body corporate with separate legal personality, an LLP can sue and be sued in its own name and can acquire, own, hold and dispose of property in its own name. Option A confuses an LLP with an ordinary firm. No special consent of all partners is needed for the LLP to be a party to proceedings.

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