Partnerships

Partnerships

1. What It Is

   • Section 3(1) - a relation between two or more persons with a common interest with a view to profit

2. What It Isn't

   • Section 4 - Joint Ownership, Sharing of Gross Returns, Sharing of profits.
     • Joint Ownership - Joint ownership does not of itself create a partnership whether or not they are sharing the profits from the owed.
     • Sharing of gross returns does not of itself create a partnership whether or not they have an interest in the property that makes the returns. Cox v. Coulson - Spectator was shot during play and the person who was shot sued the theatre but the court determined that because actor was not a servant of the theatre they could not be charged even though the gross returns were being split.
     • Sharing of profits does not make him a partner in the business and in particular: the receipt of debt, remuneration to the servant of a partner, widow/child of partner accepting annuity, someone who lend to a partner and who is to receive interest as per profit and person who receives payment due to the sale of goodwill by him. Stekel v. Ellice (salaried partner) - still all depends on the situation
       • Dollar Wise v. CIN Properties - Had a joint venture between them because they had leases between themselves. 4 million pound payoff from plaintiff's contribution was asked for. Plaintiff claimed partnership. Basically the sharing of profits and losses do not constitute a partnership.
   • Section 3(2) - a business registered under the Companies' Act or any other act relating to companies or businesses formed or incorporated any other written law or of any Order in Council or Avt of the United Kingdom or Letters Patent or Charter of the British Crown
   • Wise v Perpetual - a club is not a partnership

3. Foster v Driscoll - (if a partnership is formed to do something illegal, it doesn't escape liability just because they've tried to conceal the crime.) They wanted to import alcohol into the States which is an offence.

4. Spicer v Mansell - a partnership doesn't come into existence until business has started even though contributions have been made. Formed a food company, goods bought, goods signed for.

5. Partnership at will - Section 29(1)

6. Section 7 - Every partner is an agent of the firm and the others unless the partner has no authority to act on the firm's behalf and the person dealing with him knows that, or does not know or believe that he is a partner. Higgins v Beaucham - Defendant borrowed money under the guise of the firm's business

7. Section 16 - Anyone who holds themselves out to be a partner in the firm will be liable to all costs. Tower Cabinet v Ingram - important words "knowingly suffers"