Partnership agreements often include provisions that excuse partners from liability if they act in good faith and with the honest belief that their actions are in the best interests of the partnership.Such a provision is designed to:

A) promote the formation of partnerships.
B) eliminate any liability of its partners.
C) encourage honest partners to take reasonable business risks without fearing liability.
D) support honest partners,regardless if the risk is reasonable.

Good Faith

An honest intention to act without taking an unfair advantage over another party, often related to contractual dealings.

Honest Belief

Refers to a genuine conviction or acceptance of a fact without intention to deceive, often considered in legal contexts to determine the sincerity of a person’s actions or statements.

Liability Provision

A clause within a contract or agreement that specifies the conditions under which a party is liable for certain outcomes, damages, or losses.