Q: Partnership Agreements - What are they and do I need one?

A: A partnership agreement is an agreement between partners in a business that regulates the conduct of the business and of the partners.

Each State has its own Partnership Act that sets out the law that applies to the partnership. Provided you understand how the Act works and are happy with it, you may not need a partnership agreement.

Some businesses may not recognize goodwill and they definitely should have a partnership agreement.

You should consider whether your industry or particular business has its own peculiarities that need to be documented.

Some things that you may want to consider when entering into a business with someone else are:

• What are you going to do if the business needs more money?
• What happens if your business partner dies unexpectedly?
• What happens if you and your partner having a falling out and he or she leaves and sets up in competition to you?
• What happens if you see an opportunity to expand the business but your partner doesn't want to or can't afford to?

For assistance please contact:

• Jim Main
• Brendan Cockerill