Partnership Law-An Overview

Partnerships are an important part of business life. Many Irish business operations are subject to partnership law. Professionals such as lawyers, accountants and doctors cannot trade as a limited liability company. Other informal business arrangements in fact are partnerships. There are significant tax, accounting and disclosure advantages to the formation of partnerships over companies. However, partners are jointly and severally liable for the debts and obligations of a partnership without limitation. This must be carefully considered before forming a partnership.

A partnership is often the default form of business when two or more persons are carrying on business together and are not doing so through a registered company. Regularly traders are unknowingly in business partnerships and require advice on the applicable law.

The Partnership Act 1890 provides default rules which apply to partnerships unless they are excluded by the use of a Partnership Agreement. Many of the implied rules are inappropriate for modern partnerships and therefore it is often desirable to have a formal partnership agreement these days. Often agreements specify the capital account of and monetary contributions by each partner and the respective shares in profit and losses that will be taken. Such basic provision can avoid misunderstandings and disputes between partners.

We advise on the legal consequences partnerships. Please contact us if you require our assistance.