Section 1 of the Partnership Act 1890 defines partnership as follows “partnership is the relation which subsists between persons carrying on a business in common with a view of profit”.
Unlike a company, a partnership is not a separate legal entity. It does not exist separately from the partners but is an expression of the relationship between them. As a result, many people who go into business together end up in partnership without realising the implications and without a written partnership agreement. Under those circumstances the relationship is governed by the 1890 Act and that can have some surprising consequences.
Examples of recent work, which we have been involved:
- Dispute arising from partnership dispute informally settled by a “home-made” agreement between the parties eventually resolving through mediation.
- Advice on terms upon which to pay off former partners
- Advice to two partners regarding their options following a dispute with a third partner, that would include possible dissolution of the partnership and associated allegations of claims arising from breaches of the partnership agreement.
- Advice on the interpretation and enforcement of the terms of a partnership agreement We advised a partner on the options available to him in circumstances where the relationship with his partner had broken down but where there is no written partnership agreement.
- Litigation involving the resolution of partnership dispute. Partnership consisting of properties. Disputes over the way income had been accounted for.
- Dispute between two partners about the manner of dissolution of a partnership consisting of a trade and several properties;
- Advice on dissolution of property partnership.