Question: Does a partnership agreement need to be in writing?
Like any contractual agreement, it does not HAVE to be in writing, as verbal agreements are technically just as legally binding. However, there is never going to be a situation where not having a written contract is going to be substantially beneficial. Particularly when it comes to running a business with partners, you want to have your contractual relationship solidified, in writing, in the partnership agreement, to avoid disagreement, confusion and possible disputes down the track relating to the terms intially agreed upon.
Especially considering that in a partnership, you are each liable for the debts and actions of the other partners, so you want to be totally clear on your contractual relationship and obligations. A contract lawyer can draft or review a partnership agreement and advise you on your rights as well as in the event of a dispute. It is advisable that each individual partner seek independant legal advice so that fair and equitable terms can be agreed upon.
Answered by Lachlan McKnight
Lachlan is the CEO of LegalVision, an innovative and tech-driven law firm. LegalVision is disrupting Australia's legal industry and transforming the way in which Australian businesses access legal services. He previously worked as a corporate lawyer and investment banker in London, Paris, Amsterdam and Hong Kong. Lachlan specialises in banking and finance, capital raising and startups.
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