Signing authority of a partner in a general partnership

Questioner

I participate in a partnership with 4 other partners. We have now recorded a signing authority of 5000 euros in the trade register. We have always seen this internally as a limit of 5000 euros including VAT, but this has never been recorded in a written agreement. Recently, two partners signed a contract that amounts to more than 5,000 euros including VAT, but remains below 5,000 without VAT. They thought that by signing together, they had an authority of 10,000 euros. After inquiry, this appears not to apply. After consultation with all partners, it was decided that we would terminate the contract because we do not wish to use the service and the partners have exceeded their signing authority. The other party says that they see the signing authority as excluding VAT and that the contract is therefore valid. The contract states that in the event of a breach of contract, the entire amount will be claimed at once. Now my question is whether it is legally determined that the authority is exclusive of VAT. If this is not the case, it seems to me that we are within our rights to annul the contract. During the conclusion of the contract, our partners stated that they were working with a signing authority including VAT and that they were acting with the idea that they had a joint authority of 10,000 euros.

Lawyer

Since the trade register does not provide clarity about the amount (incl. or excl. VAT), it is possible to look at what is customary. In the case RBMAA:2009:BJ5389 the judge states that it is a fact of common knowledge that entrepreneurs use prices excluding VAT among themselves (because of the possibility of offsetting VAT). If this is not the case, this must be unambiguously known to the parties. Based on your information, it could be stated that it was stated that it concerned inclusive amounts. However, the question remains whether the trading partner could rely on the information of the partners if they indicated that they were jointly authorised. Since I do not know the content of the conversation, the agreement and the deposited conditions, I cannot give a more concrete answer. Based on the current information, it could go either way. Please feel free to contact me if you require legal advice or assistance.