In which of the following cases Garner vs Murray rule is not applicable?

Only one partner is solvent
All partners are insolvent
Partnership deed provides for a specific method to be followed in case of insolvency of a partner
All of the above

The correct answer is D. All of the above.

The Garner v Murray rule is a legal principle that states that in the event of a partnership insolvency, the creditors of the partnership have a first claim on the partnership assets, and only after the partnership assets have been exhausted can the creditors of the individual partners make a claim on the partners’ personal assets.

The rule is not applicable in the following cases:

  • If only one partner is solvent. In this case, the creditors of the partnership can only make a claim on the assets of the solvent partner.
  • If all partners are insolvent. In this case, the creditors of the partnership will not be able to recover any of their losses.
  • If the partnership deed provides for a specific method to be followed in case of insolvency of a partner. In this case, the Garner v Murray rule will not apply, and the method specified in the partnership deed will be followed.

The Garner v Murray rule is a complex legal principle, and it is important to seek legal advice if you are involved in a partnership that is facing insolvency.

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