Partnership SLA Page 3

Instructions: Read the fact pattern presented. As you work through the questions, information will be added to the fact pattern, some of which you will need in order to answer further questions. Only a correct answer will allow you to proceed.

Fact pattern

Susan Wright, Charles Thompson and John Dodgson are architects, each of whom has, to date, worked on their own account. They are proposing to pool their resources and operate as a partnership. They believe that various benefits, including economies of scale, will result from doing this. There are a number of issues regarding the formation and operation of a partnership on which they seek your advice.

The partnership which the three architects wish to form will come into being at the point at which the definition in s.1(1) of the PA is satisfied. This states that “Partnership is the relation which subsists between persons carrying on a business in common with a view of profit”. It is a question of fact as to when this definition is satisfied.

. Would you advise the three architects to enter into a written partnership agreement?

Yes. It will provide certainty as to how the business relationship between the partners is to be regulated.

Yes. It is a requirement of the PA that partnerships have a written agreement in order to override the effect of s.24 of that Act.

No. There is no requirement for a written agreement for the formation of a partnership.

No. It is an unnecessary expense - the partnership will come into existence when the definition set out in s.1(1) PA is satisfied.

Partnership SLA Page 3

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