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Partnerships

FED

This publication guides practitioners through the creation, management, and dissolution of partnerships.

2 Matter Plans

Overview

The commentary covers the structure of a partnership as well as issues of set-up, privacy, and liability. Further guidance covers flexibility, income and tax, participant structures, capital raising, and decision making.

The Reference materials folder includes guidance on electronic signing and witnessing, and the comprehensive Getting the matter underway folder includes compliance and client care documents. Using the extensive Retainer Instructions when gathering information ensures nothing is missed.

The Business Structures and the Comparative Table guide provides a comparison of the pros and cons of different business structures.

Precedents in this publication include:

  • Partnership agreement
  • Limited partnership agreement;
  • Library of clauses for partnership agreements;
  • Deed of assignment of interest in a partnership;
  • Deed of variation of share of profits and losses;
  • Succession agreement;
  • Dissolution and continuation of partnership.
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2 Matter Plans Included

  • Item icon ALERTS - Nil
  • Item icon Full Commentary - Partnerships
  • Folder icon Reference materials
    • Item icon AI Prompts
    • Item icon Electronic Signing and Witnessing
    • Item icon Looking to the Future
    • Item icon 101 Costs Answers
    • Item icon Business Structures and the Comparative Table
    • Item icon Further information
  • Item icon Overview
    A partnership is a common form of business structure that:

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  • Item icon Summary of the process
    The usual steps to establish a partnership are:

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  • Folder icon A. Getting the matter underway
    • Item icon File cover sheet - Partnerships
    • Item icon To do list - Partnerships
    • Item icon First steps
    • Item icon Client details and verifying identity
    • Item icon Retainer instructions - Partnerships
    • Item icon Conflict of interest check
    • Item icon Initial letter to client enclosing costs agreement
    • Folder icon Library of costs agreements
      • Folder icon Australian Capital Territory
        • Item icon Costs agreement - ACT
      • Folder icon New South Wales
        • Item icon Costs agreement - NSW
      • Folder icon Northern Territory
        • Item icon Costs agreement - NT
      • Folder icon Queensland
        • Item icon Initial letter to client enclosing costs agreement
        • Item icon Costs agreement - QLD
        • Item icon Abbreviated costs disclosure - Costs under $3000
      • Folder icon South Australia
        • Item icon Costs agreement - SA
      • Folder icon Tasmania
        • Item icon Costs agreement - TAS
      • Folder icon Victoria
        • Item icon Costs agreement - VIC
      • Folder icon Western Australia
        • Item icon Costs agreement - WA
        • Item icon Standard costs disclosure form for clients - Fees under $3000
    • Item icon Time and costs estimates
    • Folder icon If required - Updating costs disclosure
      • Item icon Letter to client updating costs disclosure
      • Item icon Charge securing costs
      • Item icon Guarantee securing costs
      • Folder icon Costs disclosure before settlement in litigation matters
        • Item icon Letter to client - Costs disclosure before settlement - NSW, VIC, and WA
        • Item icon Letter to client - Costs disclosure before settlement - QLD, SA, TAS, ACT, and NT
    • Folder icon General deeds, agreements, execution clauses, and statutory declarations
      • Item icon Deeds and Agreements
      • Folder icon Deeds
        • Item icon Deed for general use
        • Item icon Deed of guarantee
        • Item icon Deed of release
        • Item icon General deed of indemnity
        • Item icon Deed of assignment of agreement
        • Item icon Deed of gift
        • Folder icon Library of standard clauses for deeds
          • Item icon Amendment
          • Item icon Confidentiality for defined information - All parties
          • Item icon Confidentiality for defined information - One party
          • Item icon Confidentiality for terms of deed - All parties
          • Item icon Confidentiality for terms of deed - One party
          • Item icon Costs
          • Item icon Counterparts
          • Item icon Dispute resolution
          • Item icon Events beyond control
          • Item icon Governing law and jurisdiction
          • Item icon Interpretation
          • Item icon No assignment
          • Item icon Notices
          • Item icon Severance
          • Item icon Waiver
          • Item icon Whole agreement
      • Folder icon Agreements
        • Item icon Agreement for general use
        • Item icon Heads of agreement
        • Item icon Non-disclosure agreement - Formal
        • Item icon Non-disclosure agreement - Informal
        • Folder icon Library of standard clauses for agreements
          • Item icon Amendment
          • Item icon Confidentiality for defined information - All parties
          • Item icon Confidentiality for defined information - One party
          • Item icon Confidentiality for terms of agreement - All parties
          • Item icon Confidentiality for terms of agreement - One party
          • Item icon Costs
          • Item icon Counterparts
          • Item icon Dispute resolution
          • Item icon Events beyond control
          • Item icon Governing law and jurisdiction
          • Item icon Interpretation
          • Item icon No assignment
          • Item icon Notices
          • Item icon Severance
          • Item icon Waiver
          • Item icon Whole agreement
      • Folder icon Execution clauses
        • Folder icon Library of execution clauses for agreements
          • Item icon Attorney
          • Item icon Authorised officer
          • Item icon Company
          • Item icon Company - Sole director
          • Item icon Individual
          • Item icon Individual - No witness
        • Folder icon Library of execution clauses for deeds
          • Item icon Attorney
          • Item icon Authorised officer
          • Item icon Company
          • Item icon Company - Sole director
          • Item icon Individual
      • Folder icon Statutory declarations
        • Item icon Commonwealth statutory declaration
        • Item icon Statutory declaration - blank - ACT
        • Item icon Statutory declaration - blank - NSW
        • Item icon Statutory declaration - blank - VIC
        • Item icon Statutory declaration - blank - QLD
        • Item icon Statutory declaration - blank - TAS
        • Item icon Statutory declaration - blank - SA
        • Item icon Statutory declaration - blank - WA
        • Item icon Statutory declaration - blank - NT
        • Item icon Standard annexure note for documents
      • Item icon Standard annexure note for documents
  • Folder icon B. Establishing a partnership
    • Item icon Partnership structures
      A partnership is an agreement between two or more individuals, or partners, to carry on a business together with a view of profit. A company may be a partner.

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    • Item icon Establishing a partnership
      Establishing a partnership is a relatively simple process. Broadly, the legal and financial requirements include:

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    • Item icon Powers, rights, and responsibilities of partners
      Each partner is an agent of the other partners. All their actions and decisions in carrying on the business can bind the other partners. Consequently, partners are expected to conduct themselves in business for the joint advantage of the other partners and avoid conflicts between their own personal ...

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    • Item icon Eligibility as a general partner or manager
      A person seeking to be a general partner or the manager of a limited partnership or incorporated limited partnership is not eligible if they are:

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    • Item icon The partnership agreement
    • Item icon Partnership agreement
    • Item icon Limited partnership agreement
    • Item icon AI Prompt for Letter to client with advice on partnership agreement
    • Item icon Letter to client with draft partnership agreement
    • Item icon Letter to partners - Notice of general partnership meeting
    • Item icon Minutes of meeting
    • Folder icon Library of clauses for partnership agreements
      • Item icon Representative clause for corporate partners
      • Item icon Managing partner
      • Item icon Obligation to give notice of termination of partnership
      • Item icon Additional reasons for expulsion
    • Folder icon If required - Forms for registration of limited and incorporated limited partnerships
      • Folder icon NSW
        • Item icon Application for registration of a Limited Partnership - NSW - Department of Finance, Services and Innovation
        • Item icon Application for registration of an Incorporated Limited Partnership form - NSW - Fair Trading
      • Folder icon VIC
        • Item icon Limited partnership application - VIC - Consumer Affairs
        • Item icon Incorporated limited partnership application - VIC - Consumer Affairs
      • Folder icon QLD
        • Item icon Application for registration of a limited liability partnership - QLD - Department of Justice and Attorney-General
        • Item icon Application for registration of incorporated limited partnership - Queensland Government
      • Folder icon WA
        • Item icon Application for registration of an incorporated limited partnership - WA - Department of Mines, Industry Regulation and Safety
        • Item icon Application for registration of a limited partnership - WA - Consumer and Business Services
    • Item icon Partnership property
      Although general partnerships and limited partnerships have no independent legal personality, they can hold property in certain circumstances. Partnership property does not include a partnerʼs personal property. Partnership property must be held and used by the partners exclusively for the ...

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    • Item icon Apportionment of liability
      General partnership and limited partnership In both general and limited partnership structures:

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    • Item icon Taxation
      Partnerships lodge an income tax return but have no direct liability to pay tax. A firmʼs income is taxed indirectly through the partners. Certain limited partnerships have a direct liability to pay tax.

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    • Folder icon If required - Library of precedents for small business clients
      • Item icon Agreement for supply of goods and services
      • Item icon Credit application
      • Item icon Director guarantee
      • Item icon Dispatch and delivery policy
      • Item icon Example - Job descriptions
      • Item icon Example tax invoice
      • Item icon Liability waiver and consent
      • Item icon Privacy policy
      • Item icon Returns and refund policy
      • Item icon Terms of trade
      • Item icon Website terms of use for advertising and booking personal services
      • Item icon Website terms of use for downloadable online products
      • Item icon Website terms of use for physical products
  • Folder icon C. Succession planning and unexpected events
    • Item icon Buy and sell agreements
      A buy and sell agreement, also known as a put and call agreement, takes precedence over a will when providing for a partnerʼs death. As the partnerʼs interest in the partnership assets will be transferred under the contract, the partnership can avoid any claims against their estate or delays ...

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    • Item icon Buy and sell option agreement
    • Item icon Funding arrangements for buy and sell agreements
      Buy and sell agreements are usually supported by insurance policies taken out against the death or total permanent injury of any of the partners. On either event, the proceeds of the policy are used to pay for the outgoing partnerʼs interest. The partners can hold this insurance policy in:

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    • Item icon Buy and sell option agreements funding arrangements explanation
    • Item icon Buy and sell option - Funding agreement
    • Item icon Letter to client with draft buy and sell option and funding agreement
    • Item icon Policy register
    • Item icon Succession agreement for partnership
    • Item icon Letter to partners - Notice of general partnership meeting
    • Item icon Minutes of meeting
  • Folder icon D. Dispute resolution
    • Item icon Mediation
      Mediation involves an impartial and independent third party appointed by agreement between the parties or a mechanism in the partnership agreement. This mediator works with the parties, together or separately, to help them reach agreement and resolve the dispute. Mediation outcomes are not binding ...

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    • Item icon Litigation
      In litigation, disputing parties ask the court to determine the outcome. The courtʼs decision is binding on the parties and enforceable. Litigation is the most expensive and time-consuming method of dispute resolution.

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    • Item icon Letter to other partners - Notice of a partnership dispute
  • Folder icon E. Exiting, ending, and reconstituting a partnership
    • Item icon Exiting, ending, and reconstituting a partnership
      Several methods and options are available to a partner who wishes to leave or terminate a partnership that was created for an undefined term or ongoing purpose, or bring it to an end. The partner's exit method and the options available to other partners depends on the type of partnership. General ...

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    • Item icon Letter to other partners - Notice of expulsion from partnership
    • Item icon Deed of assignment of interest in partnership
    • Item icon Deed of variation of partnership as to profit share
    • Item icon Letter to other partners - Notice of admission of new partner
    • Item icon Agreement for admission of incoming partner
    • Item icon Letter to client with draft agreement
    • Folder icon If required - Forms to vary a limited or incorporated limited partnership
      • Folder icon NSW
        • Item icon Application for Changes in Registered Particulars of a Limited Partnership - NSW - Department of Finance, Services and Innovation
      • Folder icon VIC
        • Item icon Notice of change of particulars of partners - Consumer Affairs Victoria
        • Item icon Application for change of name of limited partnership - Consumer Affairs Victoria
        • Item icon Notice of change of terms and/or conditions of a limited partnership - Consumer Affairs Victoria
      • Folder icon QLD
        • Item icon Change of details relating to limited liability partnership – Department of Justice and Attorney-General
        • Item icon Change in registered details of incorporated limited partnership - Department of Justice and Attorney-General
      • Folder icon WA
        • Item icon Notification of changes to registered particulars - Government of Western Australia – Department of Mines, Industry Regulation and Safety
    • Item icon Letter to partners - Notice of general partnership meeting
    • Item icon Minutes of meeting
    • Item icon Letter to other partners - Notice of intention to dissolve the partnership
    • Item icon Letter to other partners - Notice of retirement or resignation
    • Item icon Letter to other partners - Notice of intention to dissolve partnership with no previous partnership agreement
    • Item icon Winding up
      On notice of dissolution, the remaining partners may decide to wind up the partnership. If so:

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    • Item icon Agreement for dissolution of partnership with one partner and continuation of business by the other
    • Folder icon If required - Forms to end a limited or incorporated limited partnership
      • Folder icon NSW
        • Item icon Notice of Dissolution or Cessation of a Limited Partnership - NSW Department of Finance, Services and Innovation
      • Folder icon VIC
        • Item icon Notice of dissolution or cessation of a limited partnership - Consumer Affairs Victoria
      • Folder icon QLD
        • Item icon Dissolution or cessation of a limited liability partnership - Department of Justice and Attorney-General - Queensland
        • Item icon Cessation of business by an incorporated limited partnership - Department of Justice and Attorney-General - Queensland
      • Folder icon WA
        • Item icon Notice of dissolution or cessation of limited partnership - Government of Western Australia - Department of Mines, Industry Regulation and Safety
        • Item icon Notice of revocation or cessation of incorporated limited partnership - Government of Western Australia - Department of Mines, Industry Regulation and Safety
    • Folder icon If required - Other documents that may be required upon dissolution of a partnership
      • Folder icon General powers of attorney
        • Folder icon New South Wales
          • Item icon General power of attorney - Client 1
          • Folder icon Land Registry Services form
            • Item icon General power of attorney
        • Folder icon Queensland
          • Item icon General power of attorney
        • Folder icon South Australia
          • Item icon Power of attorney
        • Folder icon Tasmania
          • Item icon General power of attorney
        • Folder icon Victoria
          • Item icon General Non-Enduring Power of Attorney
        • Folder icon Western Australia
          • Item icon General power of attorney
      • Item icon Clause for power of attorney to dissolve partnership
      • Item icon Partition agreement on dissolution of partnership
  • Folder icon F. Finalising the matter
    • Item icon Letter to client finalising the matter
    • Folder icon Example invoices incorporating notification of rights
      • Item icon Example invoice incorporating notification of client's rights - NSW
      • Item icon Example invoice incorporating notification of client's rights - VIC
      • Item icon Example invoice incorporating notification of client's rights - QLD
      • Item icon Example invoice incorporating notification of client's rights - SA
      • Item icon Example invoice incorporating notification of client's rights - TAS
      • Item icon Example invoice incorporating notification of client's rights - ACT
      • Item icon Example invoice incorporating notification of client's rights - NT
      • Item icon Example invoice incorporating notification of client's rights - WA
    • Item icon Closing the file
    • Item icon File closing checklist
  • Item icon Comments and suggestions for By Lawyers

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