What is a Partnership?

A partimagesnership is an association of two or more people to carry on as co-owners of a business for profit.  A partnership can be a general partnership or a limited partnership.

Many people decide to form a partnership because it allows for a pooling of owner assets, both monetary and skill sets.  In a general partnership, owners have unlimited personal liability for all debts of the partnership.  Unless there is an agreement stating otherwise, any partner may bind the partnership to an agreement with a third party.  Even in the case of an agreement stating otherwise, a partner’s actions may still be binding up the partnership.

It is for this reason that I caution people not to refer to other people as partners.  Third parties can rely on this representation, which may result in you being bound to obligations to which you did not actually agree.

Be Sociable, Share!

No comments yet.

Leave a Reply