Partnership

Nature of Partnership

Overview A partnership is not a separate legal entity. It consists of its members collectively. They can sue and be sued in the firm name under court rules. However, court orders are made by or against the partners personally and collectively.… Read the rest

Partnership Types

Partnership

Principal Type The only general form of limited partnership available in Ireland for trading purposes is that under the Limited Partnership Act 1907. A limited partner may not take part in the management of the firm. … Read the rest

Formation

Partnership

Existence

Partnership

Existence of Partnership A partnership agreement need not be in writing. It may be verbal or implied from the conduct of the parties. The way a partnership is in fact conducted may provide evidence of an agreement which varies the written partnership agreement.… Read the rest

Partnership Agreements

Partnership

Written Agreement A partnership is a contract between persons to carry on business in common. The terms of the agreement determine the legal rights and obligations of the partners. The agreement may be as formal or informal as the parties decide. … Read the rest

Authority

Partnership

Agency of Partners I Each partner is the agent of the other partners in relation to matters within the scope of the partnership. The acts of a partner in the course of business are those of the firm.… Read the rest

Capital and Finance

Partnership

Obligation to Account There is no specific obligation in the Partnership legislation which requires partners to keep accounts. Partner are in practice obliged to keep accounts for recording and taxation purposes. Partners must render a true account to each other and give each other full and true information concerning all partnership activities.… Read the rest

Goodwill

Partnership

Meaning of Goodwill Goodwill is commonly an important partnership asset. It is usually earned over time in the course of the business and represents the propensity of customers to return to deal with the firm. The value of goodwill is represented by the difference between the total value of the component assets and the total value of the business as a going concern.… Read the rest

Mutual Duties

Partnership

Rights and Duties The rights and the obligations of the partners to each other are determined by the terms of the partnership agreement, if and to the extent that there is one. There may be a written or verbal agreement or an agreement by conduct.… Read the rest

Partner’s Liability

Partnership

Personal Liability Each partner is liable personally for the debts and obligations of the partnership. Irrespective of the partners’ profit and liabilities sharing ratios, each is ultimately liable to third parties for all partnership debts and obligations. … Read the rest

Partnership Insolvency

Partnership

Partnerships and Insolvency Partnerships constitute an important mechanism for undertaking business. In certain sectors, such as the legal profession, a business may not be incorporated as a company and must practice as sole traders or partnerships. … Read the rest

Dissolution

Partnership

Partnership Assets A partnership is not a separate entity and is simply the aggregate of its members. The interest of an individual partner in the partnership assets is a chose in action. It is a “bundle of rights” which derive from the partnership agreement or the default Partnership Act provisions, which is enforceable between the partners, ultimately, by legal action.… Read the rest

Non-Court Dissolution

Partnership

Waiving Winding Up Following dissolution, either with or without a court order, the partnership must be wound up. The strict position, in the absence of an agreement to the contrary, is that upon the dissolution of the partnership, the partners are entitled to have the property of the partnership applied towards payment of the debts and liabilities of the firm and have the surplus applied towards whatever sums may be due to them as partners.… Read the rest

Court Dissolution

Partnership

Court Winding Up A partner may apply to the court to have the affairs of the partnership wound up. Unlike the position with a company, the creditors do not have the right to apply to the court to have the partnership wound up under the Partnership Act.… Read the rest

Partnership Property

Partnership

Partners’ Interest I Partnership property is not directly owned by the partners. It is available primarily to satisfy partnership debts. A partner who uses partnership property for his own purposes must account to the partnership for the free use of the property. … Read the rest

Termination

Partnership

Termination Dissolution refers to the termination of the partnership which may be, but may not necessarily be, followed by the winding up of its assets and liabilities. A technical dissolution, without a winding up, may occur on a change in the membership of the partnership.… Read the rest

Transfer and Death

Partnership

Assignability I The Partnership Act provides that a person may not become a partner without the consent of all other partners.A partnerships agreement may make other provision. For example, it might allow for the admission of a partner with the approval of the majority.… Read the rest