The changes to partnerships over time can lead to further disputes. Even where partnership agreements have been entered into, and a written contract exists. If formalities and agreements are not followed, the departure of one partner or the joining of a new partner can lead to disputes. Individuals believe they have a partnership governed by a written contract; when in fact they have only what is an unplanned partnership at will and a worthless piece of paper.
A "partnership at will" is a partnership that can be terminated by any partner outside of the terms of the agreement. This means that the survival of the partnership and its ongoing work could be at risk.
Disputes between the partners can, therefore, arise commonly when new partners have joined, and formalities have been overlooked. Still, the consequences of those potentially small disputes can be enormous for the future of the partnership.
The scope of a partnership can also broaden and change over time across a range of businesses far beyond, what was intended when they were initially set up. The development of limited liability partnerships has led to a new range of disputes.
That, in turn, can often lead to disputes between partners when individuals wish to take businesses in different directions; or when, for example, succession planning becomes a significant issue. Our expertise covers dealing with a wide variety of partnerships across a wide range of sectors and a wide variety of industries.
A partnership has to be carried out to make a profit; however, profit does not necessarily have to be made. Charitable and not-for-profit concerns cannot constitute partnerships as they cannot have the intention to make a profit. However, there are few if any restrictions of the scope of businesses, industries and sectors a partnership can cover.