A Partnership Agreement is formal legal document that defines the Partnership and the relationship between the Partners, and covers such matters as (this list is not exhaustive):
- Description of business, details of the partnership name
- Complete definition of partnership's assets
- Details of accountants, bank and premises
- Details of each partner's duties and responsibilities to the other partners
- Restrictions on/definitions of partners' authority
- Capital and income distribution (inc. full time/part time share arrangements)
- Holiday, maternity/paternity pay and leave, sick pay and other entitlements for partners
- Retirement of a partner
- Expulsion of a partner
- Termination of the partnership
- Decision making processes and method of settling disputes
Every Partnership should have a Partnership Agreement (sometimes referred to as a Partnership Deed) since without a valid and up to date Partnership Agreement, the Partnership runs the risk of encountering significant expense, inconvenience, and stress if the Partnership relationship breaks down.
The Partnership Agreement should be drawn up by the Practice's solicitor in consultation with the Partners to ensure that the agreement exactly reflects the Partners wishes. The Partnership Agreement should be reviewed regularly, and in particular each time there is a change in the Partnership.
Further guidance on Partnership Agreements
BMA guidance - (some of the information may be available to BMA Members only).
Articles on Partnership Agreements
Article - "Partnership (dis)agreements" - this article is about the issues Practice Managers may face when the Partnership is not functioning well.