1. Meaning of Implied Authority

• Implied authority is the legal power a partner has to act on behalf of the firm
  
• It arises from the usual course of business, even if not written in the deed
  
• It allows partners to bind the firm through their actions
  
• It is based on the nature of the business and the position of the partner
  
• The authority is assumed unless restricted by agreement
  

2. Common Acts Within Implied Authority

• Buying or selling goods on behalf of the firm
  
• Borrowing money or issuing cheques in the firm’s name
  
• Hiring employees or managing routine operations
  
• Settling accounts or collecting payments from customers
  
• Entering contracts necessary for daily business activities
  

3. Legal Effect of Implied Authority

• The firm is legally bound by the acts of a partner done within this scope
  
• Actions must be in line with the business type and usual practices
  
• Third parties can rely on such authority unless informed otherwise
  
• The partner’s act must appear to be in the firm’s interest
  
• Unauthorized acts may not be binding if clearly beyond the scope
  

4. Restrictions on Implied Authority

• The partnership deed may limit or define partner authority
  
• Certain acts, like selling firm assets or admitting a new partner, need explicit consent
  
• Any deviation must be communicated to outsiders dealing with the firm
  
• Restrictions are valid only if third parties are made aware
  
• Partners must respect internal limitations to avoid liability
  

5. Loss of Implied Authority

• A partner’s authority may be withdrawn through mutual agreement
  
• Retirement or removal ends the authority unless notified otherwise
  
• The death or insolvency of a partner terminates their authority
  
• The firm must give public notice to avoid liability for former partners
  

Silent or dormant partners do not have implied authority in daily affairs