Alice and Brad enter into a partnership, which becomes insolvent, as does Brad. Alice is fully liable for the debts of the partnership.

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In a general partnership, each partner is personally liable for the debts of the partnership. If the partnership becomes insolvent and cannot pay its debts, creditors can seek repayment from any or all of the partners' personal assets. If Brad is insolvent, Alice would be fully liable for the remaining debts of the partnership.

Alice and Brad Enter into a Partnership, Which Becomes Insolvent