The Money Doctor

Topics: Profit, Prima facie, Corporation Pages: 6 (2000 words) Published: February 12, 2012
1.Is “The Money Doctors” a partnership, and if so, who are the partners? Main Issue:
To identify if “The Money Doctors” is a partnership and if so, who are the partners of the business. Relevant Law:
Partnership is the relation which subsists between persons carrying on a business in common with a view of profit. There are four conditions in which all must be satisfy are the followings: Agreement

Partnership relationship may be formed by deed, in writing, verbally and lastly by inference from the conduct of the parties. In Canny Gabriel Castle Jackson Advertising Pty Ltd V Volume Sales (Finance) Pty Ltd [1974] HCA 22; (1974) 131 CLR 321 where the court held that a partnership existed on four factors which were parties joined in a commercial enterprise, with a view to profit and mutual agreement towards all policy matters relating to the enterprise. Business being carried out

Business includes any profession, occupation or trade. It is always a question of fact decided based on the circumstances of each case. Indicators of business could be also used but no one factor is decisive. However, the deciding factor to determine the existence of a partnership would be intention of the parties. In Evans v Federal Commissioner of Taxation (1989) ATC, the court held that it was not a business as it failed to have any substantial form of system and organization. In common

Partnership only exists if business is carried on by either one or more partners (without the need of equal interest) on behalf of all partners. All partners should have mutual rights, obligations (state of agency) and have the right of say in the management of business. In KEITH SPICER LTD v MANSELL[1970] 1 WLR 333, the court held that Mansell is not liable for the cost of furniture as there was no evidence to suggest that a partnership exists as they had not been carrying on a business in common with a view of profit. With a view to profit

Last conditions will be business must be conducted with a view to profit.

Intention of the parties, sharing of profits and losses and state of agency must exist in order to establish a prima facie partnership. A number of rules that can be useful to further help determine the existence or non-existence of a partnership. Even if persons acquire property together with intention to make profit does not necessarily make them partners. In Davis v Davis [1894] 1Ch 393, the court held that co-ownership is not prima facie evidence of partnership unless supported and it was supported in the case as same sums withdrawn each week had indicated the existence of some agreement between the brothers on profit sharing. Sharing of profits is prima facie evidence of partnership but does not itself create partnership in particular, Debts paid out of profit to creditor and remuneration paid to agent or employee either wholly or partly from profits of firm. In Cox v Hickman [1860] 11 ER 431, the court held they were not partners even though they had a right to share in profits. This case decided that sharing of profits alone is insufficient to make the recipient a partner but sharing of profits and losses will be a stronger indication of partnership. Emphasis was placed on the real intention of parties and contract between them. Application

By inference from the conduct of the parties where three partners agreed to contribute capital towards the establishment of business, business cards were duly printed and lastly ties were designed aligned with business name were evidence of a partnership relationship is created. Business being carried out

Relative to the case, it was a commercial enterprise (provide financial advisory service) operating its business on the acquired building together with support staff (Flo – Office Manager) on a repetitive basis. In Common

It was stated that Joe, Shmo and Moe agreed that major decisions relating to the management of the firm would require all three to agree relate towards...
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