Business Partnership Agreement
What's a Business Partnership Agreement?
A business partnership is a legal document that governs the terms and conditions for individuals to conduct business as partners. It outlines the duties and responsibilities of the partners, and also defines the scope of activity for the partnership. It is basically a contract among the various partners that provides legal enforcement for the terms of the business operations.
The business partnership agreement may be referred to in instances of dispute or legal contention regarding the activities ofthe business and the partners. In the event of a lawsuit or a violation, the court may examine the agreement to determine the partnership’s information and stance on certain legal issues.
What Is Contained in a Business Partnership Agreement?
A partnership agreement should be clearly written and should include precise details regarding the company’s activities. It should include:
- Information regarding each partner (names, contact information, etc.)
- Duties and responsibilities of partners
- Allocation of profits and losses for the partners (these are typically equal amongst partners)
- The scope of the partnership’s functions and activities
- The goals and mission statements of the partnership
- Restrictions on management and leadership
- Instructions regarding termination and dissolution of the partnership
In addition, some partnership agreements may contain a clause defining what should happen in the event of a legal dispute. For instance, the agreement may state that legal disputes may be resolved by lawsuit. Or, the agreement may state that the parties must seek alternative methods first such as dispute resolution or mediation. This all depends on the preferences of the parties.
Can a Partnership Be Changed or Amended?
In most cases, a partnership may be changed or amended at the agreement of all the members. Voting procedures may be instituted for determining which changes can be made to an agreement or not. This may be important for many partnerships, since the needs and requirements of the partnership may change over time. This is especially true if the partnership has experienced large amounts of growth. In such cases, the agreement may need to be reworked in order to reflect the new aims and needs of the organization.
Do I Need a Lawyer for Help with a Partnership Agreement?Partnership agreements can often be complex legal documents. It's in your best interests to hire a lawyer for help with a partnership agreement. Your attorney can help you draft the document, and can also review the agreement for accuracy. In the event of a legal dispute, your lawyer can go over the partnership agreement to determine your rights, and can represent you in court as needed.
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Last Modified: 11-21-2013 12:31 PM PST
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