Accountants...LLP Agreement, Advice Sought

simon johnson

Longish shot...

Two partners enter a business together with an LLP agreement drafted, before the agreement is signed one of the partners decides that it's not for him. One of the partners provided the capital, the other the business acumen, contacts etc The partner that has decided to end the partnership is the one that provided the capital, the other intends to carry on the business solo under a new name.

Without the LLP agreement signed and under the default provisions, is there a general agreement on how the capital/profits etc are split...Will the partner that provided the capital be able to withdraw all/any remaining capital? Is there a provision for the capital committed to the partnership?

Many Thanks in advance to anyone that can help!!

SJ

sungod

disclaimer - i'm neither a lawyer nor an accountant

if you had mutally agreed the draft terms verbally, then in english law i think that makes a contract

so if there's an audit trail showing that both parties were involved in the drafting of the agreement and/or that you had both acted as if the agreement were signed, did work, put money in etc., then that's probably enough to show a contract exists

best will be if you can mutually agree terms for the disolution of the partnership and a timing for fair and reasonable distribution of the assets and any liabilities

maybe the other party could remain as a sleeping partner for some period, giving you a chance to find another partner

otherwise you'll need a lawyer to advise, but imho that should be a last resort, neither of you will win in the long run