If one partner borrows money against partnership property, who is liable for the debt?

When a partner borrows money against partnership property, both partners are typically held equally liable for that debt. This principle is grounded in the understanding that partnerships are collective entities where all partners share responsibility for the obligations incurred in the course of the partnership's operations.

In a partnership, each partner acts on behalf of the business, and their actions, including borrowing money, affect the entire partnership. So, even if only one partner initiates the loan, the debt is considered a liability of the partnership, meaning all partners are responsible for its repayment. This shared liability is designed to protect creditors and provide them with assurance that they will be able to recover their money regardless of individual partner actions.

It's also relevant to mention that if the partnership continues operation after such borrowing, the other partner's liability persists since they are effectively engaging in the ongoing affairs of the business and benefiting from its continued operation. This creates a legal expectation that all debts incurred for partnership purposes must be honored by all partners collectively.