How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Ash Your Own Question
Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
75100385
Type Your Law Question Here...
Ash is online now

Hello, I am in a Partnership with another person on 50%50

Resolved Question:

Hello,
I am in a Partnership with another person on 50%50 basis. I am no longer want to work with her as we argue all the time and about everything. We are 2 self-employed and our business is Recruitment. Verbally I told her that I don't want to work with her anymore and we have 2 options: 1. I would like to keep the company and pay her a fee (as I've just closed one and this is our only one deal) and for a website as her husband made it for us for free, but I said I will pay for it, so she wants to know the number. She also said, she wants to keep the company and if I want to leave I can just leave and we close the Partnership. The problem is that if I leave and would like to keep my Clients and I am not sure she will let me do this as under our Agreement it says:26. FURTHER PROVISIONS RELATING TO OUTGOING PARTNERS
26.1 An Outgoing Partner must return to the Continuing Partners all books of account, records, deeds, drafts, letters and other documents, whether in paper or electronic form, relating to the Partnership that are in his possession or under his control. For a period of 3 months after his Leaving Date, the Outgoing Partner shall be entitled to inspect such documents, insofar as they relate to the period before his Leaving Date, on giving reasonable notice to the other Partner.
26.2 When any Partner ceases to be a Partner, the Continuing Partners shall give notice in writing of the change in the Partnership to all third parties who have in the last 12 months had any dealings with the Partnership (whether as suppliers to it or as clients or customers of it) and shall, before doing so, use their reasonable endeavours to agree the terms of such notice with the Outgoing Partner.
26.3 An Outgoing Partner shall, at the cost and expense of the Continuing Partners, use all reasonable endeavours to do or procure to be done all such further acts and things, and execute or procure the execution of all such other documents, as the Continuing Partners may from time to time reasonably require for the purpose of enabling the Continuing Partners to recover the outstanding assets of the Partnership or for the purpose of transferring to the Continuing Partners any Partnership Property which, on the Leaving Date, is vested in the Outgoing Partner as one of the Partners or on trust for the Partners. The Outgoing Partner irrevocably and by way of security appoints each and any of the Continuing Partners as his attorney to sign, execute and deliver on his behalf all deeds and documents and to do all acts and things necessary to give effect to the terms of this agreement and for vesting in the Continuing Partners the full benefit of the assets, rights and benefits to be transferred to the Continuing Partners under this agreement.
She also, has a part-time job and we verbally agreed 1,5 month ago that she can do it as she has a difficult situation and our company wash;t billing anything for the last 5 month, but our contract says: RESTRICTIONS ON PARTNERS
Without the prior written consent of all the Partners, no Partner may:
(a) engage or be concerned directly or indirectly in any business other than the Partnership Business.
so, I think she is breaching it, but I don't have much proof on paper. She is claiming that she does more work and etc. but she only spends 2 days a week working on our company and I work 7 days a week, she also never worked in Recruitment before and I taught her everything for the last 6 month. I think, she just wants money from me..
So, I just don't know what to do. I want to either keep the company, or leave but keep my Clients and be able to open my own business and continue work in Recruitment.
Please help me with this this situation.
Submitted: 3 years ago.
Category: Law
Expert:  Ash replied 3 years ago.
Alex Watts :

Hello my name is ***** ***** I will help you with this.

Alex Watts :

Do you have a partnership or Limited Company?

Alex Watts :

Do you have any form of agreement between you both?

Customer:

Hi, thank you for your reply. It is Partnership agreement.

Customer:

We have a Partnership agreement signed by both of us.

Customer:

We didn't agree on anything yet. I said that I will provide her with 2 options..

Alex Watts :

Ok - what do you want to achieve?

Alex Watts :

ok

Customer:

Well, keep the website and name of our "company" or leave, and be able to work in Recruitment and keep my Clients.

Customer:

but if I want to keep everything I will have to pay her...

Alex Watts :

Indeed. Do you know what the value of the business is?

Customer:

so far we have closed one recruitment placement - fee of £4500 (not yet invoiced and not paid yet), and we owe £500 to an accountant, £70 for website hosting (per annum), plus on top we have my partners husband who created website and is working to improve the google.co.uk search rating (SEO) but for this we havent agreed a price or signed any contract (market price for this would be circa £2,000).

Alex Watts :

Ok, so in all the partnership does not have much in way of assets?

Customer:

correct, no assets - other than website, database of candidates and some clients. no assets (no offices, no computer equipment, no phones etc etc - we work from my lounge).

Customer:

can I send you our contract?

Customer:

or just just specific clauses?

Alex Watts :

Can you send me the clauses?

Customer:

Which ones do you need?

Alex Watts :

About termination

Customer:

sure, 1 sec

Alex Watts :

ok

Customer:

so, we have this;


1. Dissolution

1.1 No Partner shall be capable of dissolving the Partnership unilaterally by means of a notice, and the Partnership shall not automatically dissolve on the death or bankruptcy of any Partner or on any Partner allowing his share to be charged [under the Partnership Act 1890.


1.2 If the Partnership is dissolved otherwise than as provided for in this agreement, the affairs of the Partnership shall be wound up and the assets and liabilities dealt with in the manner provided by the Partnership Act 1890.

Customer:

this

Customer: 1. Dispute resolution

1.1 Except as otherwise provided, any dispute arising out of or in connection with this agreement, including any question regarding its existence, validity or termination, or the legal relationships established by this agreement, shall be referred to and finally resolved by arbitration under the Rules of the London Court of International Arbitration, which Rules are deemed to be incorporated by reference into this clause.


1.2 This clause shall be without prejudice to the rights of any party to seek any injunctive or similar relief from the courts to protect its intellectual property rights, confidentiality obligations, restrictions on the activities of any Partner or former Partner or other rights of any description.

Customer:

and this ;


1. Further provisions relating to Outgoing Partners

1.1 An Outgoing Partner must return to the Continuing Partners all books of account, records, deeds, drafts, letters and other documents, whether in paper or electronic form, relating to the Partnership that are in his possession or under his control. For a period of 3 months after his Leaving Date, the Outgoing Partner shall be entitled to inspect such documents, insofar as they relate to the period before his Leaving Date, on giving reasonable notice to the other Partner.


1.2 When any Partner ceases to be a Partner, the Continuing Partners shall give notice in writing of the change in the Partnership to all third parties who have in the last 12 months had any dealings with the Partnership (whether as suppliers to it or as clients or customers of it) and shall, before doing so, use their reasonable endeavours to agree the terms of such notice with the Outgoing Partner.


1.3 An Outgoing Partner shall, at the cost and expense of the Continuing Partners, use all reasonable endeavours to do or procure to be done all such further acts and things, and execute or procure the execution of all such other documents, as the Continuing Partners may from time to time reasonably require for the purpose of enabling the Continuing Partners to recover the outstanding assets of the Partnership or for the purpose of transferring to the Continuing Partners any Partnership Property which, on the Leaving Date, is vested in the Outgoing Partner as one of the Partners or on trust for the Partners. The Outgoing Partner irrevocably and by way of security appoints each and any of the Continuing Partners as his attorney to sign, execute and deliver on his behalf all deeds and documents and to do all acts and things necessary to give effect to the terms of this agreement and for vesting in the Continuing Partners the full benefit of the assets, rights and benefits to be transferred to the Continuing Partners under this agreement.

Customer:

Hi Alex, do you need any additional info?

Alex Watts :

You will need to get a valuation of the business then give notice to dissolve it

Alex Watts :

However the value is only going to be the assets.

Alex Watts :

The company name will have some value, even if a little.

Alex Watts :

Once you have done this then you can buy your partner out

Alex Watts :

Once the business is dissolved you can purchase the name or the goodwill of the business

Alex Watts :

Clearly you only would need to pay half because you own the other 50%!

Alex Watts :

But give notice to dissolve, get it valued and that is what you need to pay your partner

Alex Watts :

Can I clarify anything for you about this today please?

Ash and other Law Specialists are ready to help you