New South Wales Consolidated Acts

PARTNERSHIP ACT 1892 - SECT 13

13 Improper employment of trust property for partnership purposes

(1) If a partner in a firm other than an incorporated limited partnership being a trustee improperly employs trust property in the business or on account of the partnership, no other partner is liable for the trust property to the persons beneficially interested therein:
Provided as follows:

(1) This section shall not affect any liability incurred by any partner by reason of the partner’s having notice of a breach of trust, and

(2) Nothing in this section shall prevent trust money from being followed and recovered from the firm if still in its possession or under its control.

(2) If a general partner in an incorporated limited partnership being a trustee improperly employs trust property in the business or on account of the partnership, neither the partnership nor any other general partner is liable for the trust property to the persons beneficially interested in it.

(3) Subsection (2):

(a) does not affect any liability incurred by any general partner by reason of the partner’s having notice of a breach of trust, and

(b) does not prevent trust money from being followed and recovered from the incorporated limited partnership if still in its possession or under its control.