Securing your business interests…
A partnership arises where persons carry on a business in common with a view to profit. There must be two or more persons involved and a partnership has no separate identity but consists of a collection of individuals.
Partnerships can be created at will simply by embarking upon the process of carrying on a business and many partnerships of this type involve friends or family members. Without a written partnership agreement the partnership will be regulated by the Partnership Act 1890 which lays down a number of rules which regulate the relationship between partners and the management of their business. These rules may be varied by the consent of all the partners and that consent may be express or inferred from a course of conduct.
The best way to ensure that partners are protected is to prepare a partnership agreement
The rules set out by the Partnership Act 1890 are not satisfactory and do not cover every situation which may arise. They may not be how you wish the partnership to be regulated. In the event of a dispute between the partners the rules are unsophisticated and may not prove an adequate remedy or protection.
The best way to ensure that the partners are protected and that certainty exists if a dispute arises between the partners is to prepare a partnership agreement. This may well save substantial costs at a later date and avoid the need for litigation.
At Caunters we can prepare Partnership agreements that cover all types of partnership from simple family businesses to professional and farming partnerships.