Legal Definitions - implied partnership

An implied partnership is a type of partnership that is created by law when one or more individuals represent themselves as partners to a third party who relies on that representation. This type of partnership is also known as a partnership by estoppel.

For example, if two individuals operate a business together and one of them introduces the other as a partner to a customer, the customer may assume that they are both partners. If the customer extends credit to the business based on this assumption, the individual who was introduced as a partner may be held liable for the debt, even if they were not actually a partner.

Another example of an implied partnership is when a group of individuals work together on a project and share the profits. Even if they did not formally agree to create a partnership, their actions may be interpreted as creating an implied partnership.