Friday 13 March 2009

UK: England and Wales: a partner's duty of skill and care - an objective standard

[Updated 16 March] There are very few cases considering the duty of skill and care owed by partners towards their partnership. Indeed, as the Law Commissions observed in their 2003 joint report on partnership law, "[t]he [Partnership] 1890 Act contains no statement of the duty of care which a partner owes to the partnership. There is uncertainty in both jurisdictions as to the standard of care which is imposed on a partner" (para. 11.16).

Against this background, Tann v Herrington [2009] EWHC 445 (Ch); [2009] WLR (D) 89 is important because the trial judge held that a partner owed his firm a duty to exercise reasonable care and skill, determined by reference to an objective standard. His Lordship rejected the argument that the partner's duty was "to take such a level of care as he would take in relation to his own affairs". 

The decision is not yet available on BAILII but a summary has been provided here by the ICLR as part of its excellent WLR(D) service. The position in Scotland was considered several years ago in Ross Harper and Murphy v Banks [2000] SLT 699

Update (16 March 2009): the decision is now available on BAILII - see here.

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