Relationship Between Building A Partnership And A Dynamic And Evolving Society

There are many pros and cons for starting a partnership. A partnership is simple, inexpensive and easy to start. Partnership's formalities are relaxed where there are no required annual meetings, as compared to other formations. Unlike other types such as a corporation, a partnership is not required to file annual financial reports with the state and not required to maintain documents. Most importantly, partnership enjoys favorable tax treatment as a passed-through entity and do not have to pay minimum taxes that are required of LLCs and corporation. However, because partnership formation is relatively simple, there is greater risk of disputes among the partners due to poor organization. Most importantly, the partners in a partnership do not enjoy limited liability. They are personally liable for the partnership’s debt, losses, and other obligations. Under the agency theory, the partnership and a partner may be held liable for other partner’s conduct. Thus, it is imperative to anticipate potential issues that the partnership may be exposed to and reduce it to a written agreement. The agreement should address how partnership reaches a decision and how to resolve a dispute when it arises. In addition, the agreement should layout partner’s termination as well as how to wind-up in the event of partnership dissolution.

A partnership is an arrangement between two or more groups, organizations or individuals who work together to achieve common aims or who have common interests.

Again in everything there are pros and cons. The pros to a partnership is that obtaining a partner is easy, when there is more than one owner this increases financial stability allowing each partner to contribute funds and potentially increase their borrowing capacity. Depending on the business and its need for additional partners this could increase employee retention because employees will see an opportunity to one day be a partner.

A partnership has many advantages. It offers lower establishment costs compared to setting up a company. It allows a group of people to contribute their knowledge, skills, specialities, and allows for all financial assets to be combined. In the future, it would permit their children to be involved in the business. Also the partnership structure can be changed to meet longer term goals.

A partnership is defined under common law as a contractual relationship between two or more persons who join together to carry on a trade or business, each contributing money, property, labor, or skill, and with the expectation of sharing in the profits and losses.

What has been said with regard to the partnership name when dealing with the partnership en nom collectif applies also to the characteristics of the partnership en commandite. In addition Article 53 of the Act states that “a person who holds himself out as being a general partner shall be held liable unlimitedly and jointly and severally with the general partners for all the obligations contracted by the partnership.” Therefore, if a partner makes believe that he is a general partner, then he will be treated as such. Furthermore, Article 53(2) of the Act provides that “the inclusion in the partnership name of the name of a person who is not a partner shall be taken into account by the Court in determining whether such person is holding himself out as being a partner." Therefore the partnership name can only include the name of the general partner, otherwise if a limited person added his name, he would be deemed to be holding himself out as being a general partner. These same provisions are applicable also to a partnership en nom collectif through Article 18 of the Companies Act.

According to the Partnership Act 1891 (SA), section 1(1), a partnership is defined in four sections. These sections relate to a business which includes any trade, occupation or profession that is carrying on involving continuity and system in common in terms of mutuality of rights and obligations with all the partners, and lastly with a view to profit, therefore resulting in an incorporated limited partnership. A corporation, however, is defined as a separate legal entity from its owners that also has the rights and responsibilities that an individual or a partnership entity possesses. This means that corporations and their shareholders have the right to participate in the profits, but will not be held accountable for the company’s debts and legal issues.

Just like all types of business ownership, also, partnerships have various disadvantages and advantages. A partnership is a union of more than one individual to keep going as a business’ co-owners for profit. Regarding this, a partnership gets formed when more than one individual, i.e., two or more people tend to work together

A partnership according to Pride, Hughes and Kapoor (2011) is "a voluntary association of two or more persons to act as co-owners of a business for profit." Unlike in a limited partnership, partners in a general

A partnership agreement may occur either orally or in the formation of written contract, which BTZ Garrett LLP solicitors would gladly draw up for you if a written contract was needed. It may be suggested that this is the best route to take as all aspects of the business can be clarified between both partners, ensuring a basis is covered. As a clarification, a partnership doesn’t, in the eyes of the law, only commence on a contractual or oral basis. An aspect used by Inland Revenue to ascertain when a partnership commences is when a new bank account is opened.

Partnership - he can be in partnership with 2 or dozen partners will be controlled and manage by the partners. This type of venture requires contract and it will govern by Term of the Partnership Act 1890. Each partner has a shared responsibility and each partner bringing in a speciality. It is easy to set up the burden of risk is a share among partners. The downside of partnership is that, there is a potential risk of conflict and partnership dissolved on death of a partner. All partners liable for the debts of the others and unlimited Liability.

There are some differences between the objectives of the structures of partnership and a corporation. Firstly, intention of a partnership is making a profit. Partnership is the relation which maintain running a business between persons with a same goal of profit and includes an incorporated limited partnership. However, the relation between the person who was involved in the company or league is either incorporated under the Corporations Law or abide by one of following laws - the Act of Parliament, letter patent or Royal Charter is not a partnership this Act meaning for. In terms of a corporation, it is not only confined in its objectives of profit but also more than for profit. In addition, it shows that a person who carry on business of a body corporate has more profit of who involved in the body.

A partnership is the relationship between persons who carry on a business together in common with the view of making a profit.

Partnership agreements are essential when entering into business with another entity. It is a contract between the partners (2 – 20 persons) although, ‘there are no legal formalities’ connected to the formation of a partnership . To ensure all for a fair working environment, private law is enforced outlining the rights a person is able to. The agreement further states legal consequences including mutual liability. All partners therefore are accountable for the actions of the other partners . As all partners are personally accountable for business debts, creating motivation for each partner to perform sufficiently as a degree of risk is present.

Different with company, the forming of partnership is very easy, without any approval and registration. People may decide to create a business together and probably have formed a partnership. They even probably created partnerships without realising if they are partners. The most important thing is the true relationship between the parties who agreed to start a business.