A partnership agreement is a legal document which sets out the rules of a partnership, helping to avoid conflict which may arise. It is highly recommended if your business is run by two or more partners even if these are family members.
Where the terms of a partnership are not set out and recorded in an agreement, disputes may arise over:
ownership division
roles and responsibilities of the partners,
the distribution of assets upon termination.
Under the Partnership Act 1890, there are key default provisions that will apply to the operation of a partnership in the absence of any specific written agreement to the contrary. So, for the sake of all involved, an agreement can avoid unpleasant conflict and wasted time and money in the future.
As each partner’s individual circumstances will vary, independent advice should be sought by each partner. We can help by giving you suggestions on what to speak to your solicitor about.
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