The general partnership or simply partnership is an association of two or more people carrying on a business with the goal of earning a profit.A partnership is viewed as being one and the same as its owners.The standard general partnership is an organization established by individuals to pursue some business activity.Although the law is permissive in relation to the establishment of such enterprise there are particular way in which law impinges controls,not just the operation of partnership,but their very formation and existence.
ISSUES TO ADDRESS IN FORMING A GENERAL PARTNERSHIP
* Amount of capital contributed by each person ,and if more is needed at a later date ,who contributed it,and any limitation to someones maximum contribution. * Rights and responsibility of each partner.
* Division of profit among the partners.
* Distribution of assets upon dissolution of company .If one partner wakes up one day and wants out ,the partnership dissolves.But liquidation would destroy the value for partners exit.One partner can transfer a profit interest to an external party,but not control. EXISTENCE OF PARTNERSHIP Rules for determining the existence of a partnership are outlined in part 2 of the uniform partnership act (UPA) some of these rules are summarized as follows. * Joint tenancy, common property, part ownership e.t.c does not by itself establish a partnership regardless of whether the owners of the property share any profits from it.three ways to jointly own poperty are: 1. Tenants in common-when one dies,ones portion of the partnership is transfered to ones heir. 2. Joint tenancy-right of survivorship when one dies,the entire interest goes to the other person. 3. Tenancy by entirely-for example a husband and a wife.each tenant owns by whole and by part.if a third party has a claim against the husband,the claimant cannot go after the property since it belongs...