How to Write a Deed of Partnership

A partnership is a legal arrangement for two or more parties to conduct business in common for the purpose of sharing the profit of the business. A deed of partnership is the legal written contract which is drawn up between the partners to show mutual responsibility, liabilities and obligations. There are four basic steps to take when writing a deed of partnership. Follow these guidelines.

Instructions

1. Meet with all of the partners involved in the partnership to discuss what will be written. Discuss issues such as how profits and losses are shared; who is responsible for what; the involvement of each partner; the work arrangement of each partner; the liability of each partner; how a partner can be added or removed from the partnership; and the arrangement for ending the partnership. There must be a general consensus of the terms before sending anything to a lawyer or accountant.

2. Hire a lawyer to draw up the deed of partnership according to the meeting notes gained from Step 1. Using an outside lawyer will ensure that there is no conflict of interest or favoritism. Have an outside accountant look over the agreement to ensure that the numbers are correct and that you won't become a target of any government tax guidelines.

3. Have the lawyer send a rough draft to each partner. With this method you can ensure that each partner feels involved in the process and can ask for corrections before the final document is drawn up. The writing of a deed of partnership can take from a week to several months depending on the complexity and number of partners involved. This step lessens the chance of legal disputes and problems later.

4. Make sure that the finished document includes the following items: definitions, a section on the formation of the partnership, partnership name, the location of the partnership, shares and capital of both partners and of the partnership, the contribution of each partner, the restrictions of the partnership upon the members, and the duties of each partner and of the partnership to its members. You also want to include how decisions are made and when formal meetings are held, as well as what should be decided in formal meetings. The final section of the deed of partnership must include specifications on how the partnership will be dissolved, as well as what happens to the assets of the partnership and how the assets will be liquidated.