An active partner in the firm, knowing that the goods were stolen ones, purchased and sold them in the firm's name. the other partner, who was a sleeping partner, knew nothing about the theft. In such a situation the partners will be held liable for the tort
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True
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False
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Partly true
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Cannot say
A
Correct answer
Explanation
Under Section 26 of the Partnership Act, the firm is liable for wrongful acts of a partner done in the firm's name or business. Even if one partner (the sleeping partner) was unaware, the firm remains liable for the active partner's tort committed while ostensibly acting for the firm. This protects third parties dealing with the firm.