a. Is a partnership liable for the promises that its partners make?
b. In this case, five partners promised the associate that, as long as he committed no major blunders, he would make partner the next year. Did the partners have authority to make this promise?
c. What if these five partners had promised an outsider that the firm would hire him as a partner?
When the law firm of Plante & Moran passed over John Dorsey for partnership, he threatened to quit. Five partners told him he would make it next year if he avoided any major mistakes. The partnership agreement required a two-thirds majority to admit new partners. The partnership then had 60 partners. The next year, the partnership did not vote Dorsey in. He sued-and lost.