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If you find yourself involved in a partnership dispute or have been threatened with legal action, our highly renowned team of dispute resolution solicitors can help guide you through, including providing advice on issues relating to the retirement of a partner, expulsion from the partnership and asset valuation.

We actively seek to resolve disputes as early as possible and recognise that avoiding court is a priority for everyone. In the first instance, we will always try negotiating with the opposite party and view court as a last resort.

In the event of court proceedings become necessary, we will assist you with the presentation of your case and can draw upon the expert guidance of our extensive professional network of accountants, valuers and insolvency practitioners.

Our approach will always be based around you.

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Our Experience

Case 1:

Representing two remaining partners dealing with the ramifications of their fellow partner retiring from the partnership and advising on issues relating to:

  • Breaches of statutory rights and duties of partners under the Partnership Act 189
  • Breaches of the terms of a partnership agreement
  • Disputes over share of profits, distribution of assets and reconciliation of debts
  • Liability of partners
  • Suspension, expulsion or retirement of a partner
  • Dissolution or winding up a partnership

Case 2:

Acting for shareholders in a technology company. Dispute with their co-director and shareholder. A share transfer notice contained in a shareholder’s agreement was triggered by the clients against their business partner due to transactions that were carried out which could have brought the business into disrepute.

  • The business partner disputed the allegations and threatened an action for unfair prejudice pursuant to Section 994 of the Companies Act.
  • The matter was settled on a commercial basis and the partner resigned as a director and sold his shares for a negotiated sum.

Case 3:

Acting for a claimant in a shareholder dispute arising out of the alleged unlawful retrospective cancellation of the client’s shares in a company and the claim for fair value for our client’s shares following a subsequent sale of the company since our client remained a shareholder. Potential unfair prejudice petition to obtain declaratory relief/fair value for his shares.

Partnership Disputes FAQ

Does a partnership exist?

For a partnership to exist, a group of individuals must be carrying on business in common with a view to making a profit. Partnership disputes can arise without there being any formal documentation having been drawn up between the partners. This means that individuals can find themselves in partnership without even knowing they are and, when problems arise in the partnership, may find themselves in the middle of an often messy and costly legal dispute.

What are the terms of the partnership?

In the absence of a partnership agreement, the terms of the Partnership Act 1890 will apply. This is a very brief and vague piece of legislation which leaves a lot of matters to be determined.

If there is a partnership agreement, often the terms of these will change over time so it is important to be aware of any updates to the partnership agreement or other agreements that govern the partnership.

What about liability and decision making in a partnership?

Partners are jointly and severally liable for all debts relating to the partnership and liability is unlimited since a partnership is not a separate legal entity (unlike an LLP or limited company). In the event partners have changed over time, it is important to ascertain the identity of the partners at the time any liabilities were created.

Unless there is an agreement to the contrary, standard business decisions affecting the partnership can be made by a simple majority. Decisions regarding the nature of the partnership business require unanimity.

Removal of a partner from the partnership

Unless there is an express power of expulsion set out in a partnership agreement, there is no automatic right to expel a partner from the partnership. In such circumstances, it will be necessary for the partners to reach an agreement. If no agreement can be reached, it may be necessary to dissolve the partnership.

Dissolution of a partnership

Dissolution of a partnership is often complex and does not in itself terminate all rights and obligations of the partners. For example:

  • Partners of the dissolved firm will remain bound by any obligations entered into prior to the dissolution;
  • If proper notice of dissolution has not been provided, contracts entered into by one of the partners may legally bind all of the partners;
  • After dissolution, the partnership relationship will continue insofar as is necessary to properly wind-up the affairs of the partnership and complete any outstanding transactions entered into prior to dissolution.

Testimonials

Meet Our Specialists

Home-grown or recruited from national, regional or City firms. Our specialists are experts in their fields and respected by their peers.

Adam Maher

Adam Maher

Adam is a Partner and Head of our Commercial Litigation department

Sven Clarke

Sven Clarke

Sven is a Legal Director in our Commercial Litigation department.

Sean Kinney

Sean Kinney

Sean is an Associate in our Dispute Resolution and Commercial Litigation Department.

Gemma Symons

Gemma Symons

Gemma is a Solicitor within our Commercial Litigation department.

Contact Us

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0161 941 4000