A partnership agreement Essay Example | Topics and Well Written Essays - 2500 words

A partnership agreement - Essay Example While such procedure will be effective in prevention of future conflicts, it has been found that conflicts are inevitable due to changes in laws and circumstances. It is also impossible to document every aspect of the partnership and as such, the document needs to be flexible enough to allow the inclusion of changing needs and circumstances of the partnership. Partnership agreements may need to be modified in the instance of divorce settlements, which may lead to the family members of a partner receiving shares, bankruptcy, death, retirement, disability, translocation of a partner, a partner intending to sell after getting a nice offer, debts taken out on the partnership. All of these reasons make strong the argument for the partnership agreement to be made flexible.Divorce Settlements  At the time of getting into marriage, many partners overlook many of the provisions of a partnership agreement. In most instances, it is assumed that divorce or separation will not occur.. However, it has to be acknowledged that divorce and separation are an inevitable occurrence of modern life. It is thus important that since the marital circumstances of the partners may change in the future the partnership agreement be flexible enough to allow the inclusion for the changing circumstances. It s estimated that about a million of the businesses in the US are co owned by wife and husbands in a partnership. That being said it is inevitable that conflicts will arise in instances of divorce or separation of the couple.... All of these reasons make strong the argument for the partnership agreement to be made flexible. Divorce Settlements At the time of getting into marriage, many partners overlook many of the provisions of a partnership agreement. In most instances, it is assumed that divorce or separation will not occur.. However, it has to be acknowledged that divorce and separation are an inevitable occurrence of modern life. It is thus important that since the marital circumstances of the partners may change in the future the partnership agreement be flexible enough to allow the inclusion for the changing circumstances. It s estimated that about a million of the businesses in the US are co owned by wife and husbands in a partnership. That being said it is inevitable that conflicts will arise in instances of divorce or separation of the couple. To add on to that many of the people who enter into business partnerships with other people other than their spouses are usually married. The resources broug ht into the business may thus be considered to belong to the family. Upon divorce, the couple may be required by law to divide the shares in the business in the interests of justice. A partnership agreement that does not take into account such things as divorce may thus need to be amended in order to accommodate the new dispensation. This is best exemplified in Estate of Cohen v. Booth Computers in which Cohen was suing her husband over shares held jointly by both of them. The judge ruled that Cohen was entitled to a share in the company by virtue of marriage since there was no express provision in the partnership agreement that was against such as scenario (Mahler, 2011). Bankruptcy Bankruptcy is the inability of a person to pay