It is better you reply the legal notice and, it appears there is dispuet in settlement of assets. He is no more a partner to your firm so he cannot interfare in partnership bussiness. But in every partnerhsip there is a clause for setllement of disputes,, if your partnership comes under an arbitration agreement then you can seek process for appointment of arbitrator and finalise the matter. COnsult a lawyer good one , i think you left some loose ends yet to be fixed.
He is not interfering with the firm business at all nor demanding he has rights in the firm. He is only violating the terms mentioned in the letterhead which is mutually agreed internally between the Partners. He is only highlighting the terms mentioned in the unregistered agreement that flat will be registered to him or 3rd on his behalf where we haven't mentioned sale deed amount should reflect in the firm Account.
Just reply him that the unregistered agrement was superceeded by the retirement registerd agreement whereby all of the issues were settled. Neither the firm or any person from the firm owes to you any thing. But if there was any such commitment you shoudl fulfill that under moral obligations. Legally it will take him life to prove naything on unregistered agreement.
Dear attach agreement copy....would like to know the sense in execution of that