At Libra Solicitors, we believe that well-drafted partnership agreements will clearly define the rights, ownership of the business and the responsibilities that exist within a business and can benefit the business significantly. The clarity that such an agreement can bring, generally promotes stability within the firm and could help to avoid costly disputes that might undermine the success of the business. For a confidential discussion about partnership agreements and the issues that may be concerning you, call us today on 01223 632420 and arrange an appointment.
If you have decided on a partnership structure for your business, you should give serious consideration to implementing a partnership agreement. A partnership agreement provides the framework in which the business will operate and can be invaluable in reducing the potential for disagreement between partners.
It is in the partnership agreement that, amongst other things, the rights, obligations and liabilities of each partner, can be clarified. The agreed length of the partnership can also be recorded in it as can the agreed exit arrangements of each partner.
Provisions to consider
The provisions of a partnership agreement can vary considerably from business to business. However, an effective partnership agreement should properly deal with key issues such as:
- Ownership, profit sharing and partnership salaries.
- The division of work between the partners.
- Identifying the contribution and/or continuing contribution, financial or otherwise made, or to be made, by each partner to the partnership.
- The issue of loans made to the partnership either by the partners themselves, or by outside parties such as banks or other lenders.
- Deciding the extent of each partner’s authority to conduct business on behalf of the partnership.
- Establishing the decision making process and identifying which business decisions will need unanimous agreement and which decisions can be made individually by the partners. This is especially important in respect of business spending and asset disposal.
- Managing the business bank account and controlling access to funds.
- Selling the business and dividing the profits or liabilities between the partners.
- Provisions that deal with the different aspects of possible conditions of sale, buyouts or transfer in respect of the partnership interests, should also be included.
- Provisions for resolving partnership disputes, which may include a requirement to engage in mediation before issuing proceedings in the civil courts.
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How we can help
Your business has its own specific needs and at Libra solicitors we can help you meet them. Whether we are drafting a bespoke partnership agreement tailored to the individual requirements of your business and the partners themselves, or are reviewing the existing agreement to ensure it contain the key information you think should be clearly recorded, we can help ensure your partnership has the clarity it needs to move forward with confidence.
We can also help if you are involved in a partnership dispute and have decided to start litigation proceedings, or are being litigated against. Our expertise will be focused on helping you achieve the best possible outcome and we will give you clear, practical advice so you are fully aware of the options available to you and can make informed decisions as to how to proceed.
We have a proactive approach in preparing our clients’ cases and will act quickly to protect your interests. For example, if we believe that an interim injunction is urgently required, we will explain as to why it is necessary. Should you decide to take our advice, we will act immediately to get the matter before the court where we will put forward a persuasive argument in respect of the application.
Sometimes the option to litigate may not, at the outset of resolving the dispute at least, be available. In respect of partnership disputes for example, examination of the partnership agreement might reveal that in the event of a dispute, the process to be used in order to resolve it, is a dispute resolution process such as mediation. Should this be the case, our expertise in alternative dispute resolution could help you to achieve a positive outcome.
For a confidential discussion about your business needs, call us on 01223 632420 and arrange an appointment. With Libra Solicitors, you can be sure that you will get the right advice when you need it most.