A partnership allows two or more people to join forces and set up business together. Each partner will share the net profits of the partnership, but will also be jointly liable for its liabilities.
Partnerships should only be formed by people who trust each other and who can bring different qualities and strengths to the running of the business. It may be that one of you is the strategic visionary while the other provides the operational direction. Whatever the mix, it is essential that you have a partnership agreement in place.
Partnership agreements should be entered into to regulate the management of the partnership as there is little statutory guidance on how a partnership should be run.
This informal partnership will be subject to the default provisions of UK partnership law which will govern the most important aspects of the partnership including:-
- How the profit of the partnership is split
- How the losses of the partnership are split
- How much voting right each person has
- And how the partnership is to be terminated
The laws relating to the above often do not reflect the intentions behind most partnerships. Furthermore there may be other aspects of your partnership which are not governed by these considerations but are commercial considerations, and the position on these will not be governed by any law.
If you do not want your partnership to be governed by the default provisions of UK Partnership Law it will be necessary for you to have a formal Partnership Agreement in place and our Commercial Solicitors at MLP Law are able to provide you with the proper legal and commercial advice to allow you to decide upon the terms of your Partnership Agreement and we draft an appropriate agreement for you.
For more information contact us at firstname.lastname@example.org or give us a call on 0161 926 9969