Codelek General Blog » Business::
We are going to open our new branch downtown and I am very proud of myself and my business partner of course, because we have pulled this through tough and
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Whether you have been in business for 40 years or you recently finished school and are just starting out, everyone carrying on a business should ensure that they are adequately protected. Things may have run smoothly to date, but if Murphy has taught you anything, you will know that something is bound to go wrong – and it often occurs at the most inopportune time. By no means is this reason to expect that a hurricane is always around the corner, but won’t you be relieved to have a storm cellar if that hurricane shows up on your front door step.
There are ways to ensure that you and your business are protected regardless of your business structure. Many businesses take the form of a partnership. Under the Ontario Partnerships Act (the “Act”), a “partnership” will exist where two or more persons are carrying on a business together with a view to profit. A formal written partnership agreement is not required for there to be a “partnership”. There are several factors that will determine if a “partnership” actually exists, one of the most important being the specific intentions of the parties. It is noteworthy however, that the actions of the parties will trump their intentions. An express declaration that the intention of the parties is to carry on business without forming a partnership will be overpowered by actions that demonstrate otherwise, and in such a case, a partnership will be found to exist.
The Atlantic | October 2001 | Will the Circle Be Unbroken? | Terkel::
One case sticks in my mind. This man came in, and he said, 'My partner died. . My mom looks so nice.' A lot of these boys that died from AIDS,
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press.co.nz - Get the latest local, national and world news from ::
At the weekend I visited a friend whose partner has recently died and who’s about . As you do, my partner and I have done some exploring to find out the
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Some of the issues that require attention and must be addressed in this context are:
Was it your intention for the business to be a partnership?
Have you contributed your own personal services or property into the partnership?
Do you have some informal written or verbal agreement already in place?
How are the profits and losses being divided between the partnership, and are those divisions accurately reflecting your interests?
Did you merely intend to be a passive investor and limit your potential losses and liabilities but continue to share in the profits?
Have you set up a mechanism to account for a partner leaving the business, or another individual entering the business?
How will the partnership interest be transferred?
Have you limited a partner’s ability to compete if they walk away from the business?
The next logical question is “So what? What’s the difference if my business is considered to be a partnership or not?”
There must be cost effective private health care::
In fact the" hospital" was a private nursing home which I ran with my business partner, but" hospital" was the best word my sick father could find as he
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Karla Faye Tucker: Born again on death row - CNN.com::
TUCKER: Danny's brother, my partner in crime, my boyfriend -- his brother so I never did any socializing, but when I went back to my tank that night,
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A carefully drafted partnership agreement is capable of offering the flexibility and protection that can satisfy most of your concerns. Virtually any arrangement can be created, but it is at the beginning of the relationship that the planning and preparation must occur. These are issues best dealt with before problems develop. For instance, if you are involved in a general partnership, and one of the partners dies, the partnership is considered to have been dissolved pursuant to the Act. Had you contemplated that possibility and subsequently prepared for such an event in the partnership agreement, that dissolution could have been avoided. Another dangerous reality is that each partner has the ability to bind the partnership (and the other partners) to agreements, debts, and liabilities, without the consent of the other partners. Such broad powers of your partner(s) can be limited through a partnership agreement.
Due to the broad definition of what constitutes a “partnership”, there is a wide variety of situations where partnerships have been found to exist. If two or more people are purchasing a property together, or even sharing office space, the relationship could be deemed to be a partnership. Even in situations where individuals have separate businesses and are not partners, if they share in the profits or losses of a separate, single transaction, the relationship may be considered a partnership. Additionally, if someone operates an existing business, and a 3rd party begins contributing a form of capital, a partnership may be found. The combinations of circumstances that can create a partnership are limitless, and it is for this very reason that prudence is required so as to adequately protect yourself.
Partnerships are not considered to be separate legal entities from the individual partners themselves. In a practical sense this means you can be personally sued as a partner. A higher degree of personal protection can be achieved through the formation of a “limited partnership”. This discussion however, falls beyond the scope of this particular article.
Some provisions of the Act cannot be avoided. Nonetheless, by way of a properly drafted partnership agreement with sections that override the default provisions of the Act, the effect of many provisions can be altered or even entirely circumvented. Without an agreement however, the default provisions of the Act will apply to your business. These default provisions may be contrary to how you intended the partnership to be set up and would therefore work to your disadvantage.
The bottom line is that the organization, planning and structuring of a partnership can be done in ways that adequately address your specific and individual concerns. This is something that should, whenever possible, be done at the outset. If you feel that such preparation is overly cautious or that it requires spending time and money on something you may never have to rely on, remember that having a well drafted partnership agreement in place is akin to building a storm cellar. While you may never need to use the storm cellar for the reason it was built, down the road such preparation has the potential of saving you an indeterminable amount of stress, loss and expense - an investment with an invaluable payoff. Remember - the business world is a stormy one.
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My Partner Died! ...and so Did My Business