PARTNERSHIPS

Marshall and Galpin Solicitors is a partnership, and we therefore understand the partnership concept from first–hand experience; we have a real awareness of the commercial implications of the way a partnership conducts its business.

Partnerships have been in existence for many years and the principal legislation of 1890 still applies.  This places a great onus on partnerships to ensure that their affairs are properly regulated and a good starting point should be a Partnership Deed.

The Deed sets out who the partners are, their roles and interests in the partnership, the liabilities of the partners, voting rights and provisions dealing with incoming and outgoing partners.

A properly drafted Deed should also help to resolve any disagreement if partners fall out at a later date or the partnership experiences financial difficulties.

Partnership Check List

Listed below are some of the suggested clauses which you should consider including in a Partnership Deed.

1. Business Location – There needs to be some certainty as to where the partnership will operate from and the terms on which it will occupy any property.
2. Partnership Capital – You need to ensure that all partners are aware of what financial contributions are expected from them.
3. Partners Personal Liabilities – This clause should detail particular obligations which partners need to fulfil to properly carry out their duties.  This could be a professional qualification, on-going training or maintaining a clean driving licence.
4. Partnership Property – This clause should specify what belongs to the business and whether the premises are included.
5. Partnership Earnings – It is important that all partners understand which monies received need to accounted to the partnership and which belong to an individual partner. Earnings attributed to a partner personally might be, for instance, external lecturing or certain gifts.
6. Profits and Losses – This is an essential clause, as it will set out how profits and losses are to be apportioned between the partners.
7. Decisions and Voting – This will set out the rules for the formal running of the partnership
8. Obligations on Leaving the Partnership – This will include obligations to continue to maintain specified duties and in the case of professional partnerships, will have implications with regard to future liabilities and insurance policies.

This is not an exhaustive list and each partnership will be different.  The key is to obtain good professional advice at an early stage.

At Marshall & Galpin we have a team of specialist commercial solicitors based at our Oxford office, who will advise you on the setting up of your partnership and the Partnership Deed.