Despite its widespread use in modern societies, the commutative partnership contract faces ambiguity regarding its legal effects due to the silence of the Civil Code and its conceptual overlap with joint ownership and permissive partnership. This study adopts a descriptive-analytical approach to examine the legal consequences arising from the binding nature of the commutative partnership in comparison with the permissive partnership under the Civil Code. The findings indicate that the commutative partnership, due to the reciprocal transfer of ownership and the creation of joint ownership, is regarded as a binding contract, unlike the permissive partnership. This binding nature constitutes a significant limitation on the partition of joint property and the transfer of partnership shares during the partnership. Therefore, termination of the partnership is possible only through mutual rescission, the occurrence of statutory grounds for rescission, the consent of the other partners to conclude a new partnership with the transferee, or the loss of legal capacity of the parties where the partners’ obligations are subject to personal performance. Regarding the agency arising from the commutative partnership, although some scholars have attempted to consider this authorization irrevocable through concepts such as agency conferring a right, delegated mandate, or the granting of a proprietary right of disposition, within the current Iranian legal framework it remains subject to the general rules of agency. Nevertheless, where it can be inferred from the parties’ agreement or customary understanding that the purpose and continuity of the partnership prevail over the personal characteristics of the partners, the commutative partnership remains valid as a binding contract despite the loss of legal capacity of the parties. In such cases, if the partners or their legal successors refuse to grant the necessary agency, the court may intervene to resolve the dispute and ensure the continuation of the partnership by granting agency.