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Partnership law - Court finds that Partnership Agreement did not provide for goodwill
26 September 2011
On 15th September 2011 a Court found that that despite the Claimant's contention that, at the time of negotiating to become a partner, it was agreed that he would acquire a share of goodwill, on all of the evidence this was wrong and the agreement did not provide for this. The Court found that it was likely that he was told, that if there was a sale of goodwill whilst he was a partner, he would share equally in any gain. However that was not a matter of ownership but of the distribution of capital profit between partners.
Howell Jones handle both contentious and non-contentious partnership issues and this clearly shows the importance of recording the precise terms of agreement at the start of any partnership arrangement. It demonstrates that it can be dangerous to rely on verbal representations.
Please feel free to contact the Litigation Team to discuss this case or a partnership problem that you may.
Andrew Petchey, Partner, Litigation Team.
