The Becket Chambers Commercial Team deals with all types of business organisation- from listed companies to sole traders.
A surprising number of disputes come from partnerships, when two or more friends or relatives have set up a business informally, and there is, later, a disagreement as to what each partner may, or may not do.
Partnerships are becoming more commonplace, but the law comes from the Partnership Act 1890. If two or more people come together to make a profit, it may be considered a partnership.
Without a partnership deed (also known as a partnership agreement), any disputes will fall to be dealt with under the Partnership Act. This is often not the most economical or desirable way to deal with a dispute- there are swathes of cases that may need to be considered, interpreted, and argued in court. The law has not quite caught up with modern business practice. For example if a partner dies, then according to the Partnership Act, the partnership usually has to be dissolved.
A partnership deed should include, amongst other things:
Each partner’s contributions;
Working hours and holidays;
Who will deal with tax/ accountancy matters.
Of course, each partnership will have its own unique matters of relevance, which is why it is so important to set out the terms of business at the outset.
It is far better to consider possible disputes and disagreements at the start, rather than several months or years into the partnership when everyone is committed.
The Becket Chambers Commercial Team can help your partnership draft agreements, or settle disputes if possible. If yours is one of the cases that does go to court, we can assist with plain and honest advice, followed by robust representation.
Contact firstname.lastname@example.org for further information