The duty of loyalty refers to the duty of a partner to refrain from competing with the partnership in another endeavor or profiting individually from a transaction related to the partnership. This duty does not mean that a partner cannot further his or her own interests; a partner may not further his or her own interests to the detriment of the partnership. Application of this duty may arise when one of the partners owns several businesses, and the potential for competition between a separate business and the partnership arises. Another situation occurs when one the partners wants to leave the partnership. It is not uncommon that the partner may take steps to set up a separate business, and establishing the new business may conflict with the interests of the partnership.
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