What are articles of partnership?

Question

What will be an ideal response?

Answer 1

Although generally not required, it is highly desirable to have written articles of partnership. (Partnership agreements may need to be in writing when they create an interest in real property or have a term in excess of one year.) A written contract tends to minimize misunderstanding and disagreement. The process of preparing such an agreement is likely to cause the parties to provide for contingencies they might not otherwise consider. This is especially true if a lawyer is called on who is experienced in drafting partnership agreements. It should be noted that lawsuits raising the question of whether or not there is a partnership usually arise where arrangements among the partners have been casual. Disputes are more likely when there are no written articles of partnership. Articles of partnership usually state how profits and losses are to be shared. They should provide a means for continuing the business on the death or disability of a partner. Other matters usually included in articles of partnership are the name of the firm, the business to be carried on, the term for which the partnership is to exist, salary and drawing accounts, the authority of the partners to bind the firm, and provisions for withdrawal of partners.