In England a controversial issue that arises from time to time is whether a partner in a general partnership causes a dissolution of the partnership by accepting a repudiatory breach by one or more of his co-partners, without the intervention of the Court.

Section 35(d) of the Partnership Act of 1890 (PA) provides that on an application by a partner the court has a discretionary power to order a dissolution where the other partner “wilfully or persistently commits a breach of the partnership agreement…”. That the PA is not an exhaustive code of partnership law, is reflected in the provisions of section 46 of the PA: “The rules of equity and of common law applicable to partnership shall continue in force except so far as they are inconsistent with the express provisions of this Act.”

There now appear to be two schools of thought on the issue. The line of cases led by the Court of Appeal in Hurst v Bryk [1999] Ch 1 ,which has never been overturned, supports the proposition that the contractual doctrine applies without the intervention of the court whereas the first instance cases of Mullins v Laughton [2003] Ch 250 and Golstein v Bishop [2014] Ch 131 take the view, based on the obiter dicta of Lord Millett in Hurst v Bryk [2002] 1 AC 185 HL, that only a decree by a court under section 35(d) of the PA will cause a dissolution of the partnership. In our view the former proposition should revail on the basis of stare decisis and the commercial relationship between the partners.

In India, partnership issues are primarily but not exhaustively dealt with by the Indian Partnership Act of 1932 (IPA). Section 74(f) of the IPA provides that nothing in that Act shall affect any rule of law that is not inconsistent with the Act. Repudiatory breach is provided for in section 39 of the Indian Contract Act 1872 (ICA). Section 44(d) of the IPA is framed in similar terms to section 35(d) of the (PA) to the effect that the court has a discretion to dissolve a partnership. However, in construing sections 74 of the IPA and 39 of the ICA it is arguable that a partner can dissolve a partnership by accepting his co partner’s repudiatory breach, without the intervention of the court.

There would be no inconsistency between sections 39 of the ICA and 44(d) of the IPA because a repudiatory breach is by nature much more serious than that envisaged in sections 44(d) of the IPA and 35(d) of the PA and is a legal right.