In January 2011, Han, Ita and Jo formed a partnership, under the Partnership Act 1890, to run a pottery business trading under the name HIJ Potteries. On formation, Han introduced ￡6,000 into the business, Ita introduced ￡3,000 and Jo introduced ￡1,000. All of them took an active part in the operation of the business and the partnership agreement stated that all profits and losses should be divided in proportion to the capital contribution. However, as Jo was the person who would actually be making the pottery, it was agreed that she would not be liable for any more than her initial contribution towards any future debts. After some time, Han provided the partnership with a loan of ￡1,000 in order to sustain the operation of the business.Unfortunately, the business was not successful and made significant losses. The partners concluded that it would be best to stop trading and dissolve the partnership. Its assets were worth ￡5,000 and its external debts were ￡9,000.Required:In the context of the particular form of the partnership, explain the potential liabilities of Han, Ita and Jo for the partnership debts. (10 marks)
