In unlimited partnership, every partner is liable, jointly with all the other partners and also severally, for all acts of the firm done while he is a partner.
You can be held personally responsible for another partner's negligence or carelessness
Legally speaking, a partnership is an association of two or more persons, known as general partners, who act as co-owners of a business and operate it for profit.
While you are not legally required to have a written partnership agreement, an oral agreement may suffice, it is still good business to put everything (the details of ownership, including the partners’ rights and responsibilities and their share of profits) down on paper to avoid potential misunderstandings and disagreements.
According to the Partnership Act of 1932, the partners are free to determine the mutual rights and duties by contract.
Unlike a general partner, who is personally responsible for all debts and obligations of the partnership, a limited partner can lose only the amount of capital he has invested in the business.
On the down side, he has relatively little power within the partnership because he is not allowed to be actively involved in the management of the business; he is merely a financial contributor.
Nevertheless, he has the right to be informed of all business matters relating to the company and to share in its profits.
Before entering into a partnership, weigh all the pros and cons.