Are you thinking about setting up a business?
If so, there are many things to think about especially if you are looking to do it with another person(s) and want to avoid conflict further down the line.
Lindsay Dixon’s guide on partnership below, will walk you through 7 areas you need to consider:
- A partnership is one of many options available when running a business. You don’t have to use one and you should take advice before you start trading on the best structure to use;
- Partners will frequently share profits and losses and will usually be bound by a Partnership Agreement which governs their relationship. Partnership disputes are common and can be complicated by the lack of a formal Agreement;
- In some circumstances, parties can even dispute the very existence of a partnership. Unless it can be established that the parties intended to create a partnership and operated their business on that basis, any claim will not succeed;
- The Partnership Act 1890 provides the definition of a partnership; that is persons carrying on a business in common with a view to making a profit;
- Individuals operating within a partnership should have a professionally drafted Partnership Agreement to protect them in the event the relationship breaks down.
- A Partnership Agreement should also clearly reflect the intentions of the partners and avoid the uncertainty and costs associated with the Court having to interpret the intentions of the parties after the event; and
- The dissolution of a partnership can raise some complex issues on which legal advice should be sought at an early stage, particularly where there is a risk of one partner dissipating assets of the partnership.
If you have any questions relating to partnerships or any other aspect of your business please get in touch with Lindsay Dixon Consultant Solicitor Legal Studios – Lindsay.firstname.lastname@example.org