Partnerships

Partnerships are formed when two or more people carry on a business
with a view to making a profit.  There does have to be any agreement
in writing and the question of whether or not there is a partnership in
existence is always a question of fact.

If you are considering going into business with someone then it is essential that you take legal advice on the consequences of being
involved in a partnership.  Potentially you are making yourself financially
and legally responsible for a whole range of liabilities and duties and it
is crucial that you are fully aware of those from the outset.

It is almost always essential that you enter into a written partnership
agreement as this will enable you to agree with your business partner
what will happen in any given situation including the following :

#          If one of you wishes to leave the business

#          How the profits will be shared

#          What will happen if one of you has long term illness or
            cannot carry on

#          Who will own the name of the firm and its goodwill should
            you wish to go your separate ways

#          What happens if one partner does not pull his weight

If you have a partnership dispute then the Court will apply the terms of your partnership agreement in resoling that dispute.  If you do not have a written agreement then you have a “partnership at will” and the terms and obligations which as business partners you have for each other is set out in the Partnership Act 1890.  Applying the provisions of this Act will often work unfairly against one of the partners and result in lengthy and costly legal proceedings which could have been minimised had a suitable written partnership agreement been signed at the commencement of the business.

In addition to a partnership under the 1890 Act it is now possible to set up business as a “limited liability partnership”.  This is a very different legal entity and one which does offer the partners a limit to their liabilities which is not available to them under the traditional partnership arrangement. 

We have a specialist and approachable (!) team etc etc…..

For more infomation please contact one of the following:

Name Position Office
Patrick Langrishe Partner Budleigh Salterton
Craig Oliver Solicitor Exeter