Did you know? Without a written agreement, partners share profits and obligations equally!
CA Corporations Code §16202(a) “Except as otherwise provided…, the association of two or more persons to carry on as co-owners a business for profit forms a partnership, whether or not the persons intend to form a partnership.
In the event that a partnership dissolves, becomes involved in a lawsuit, or if there is a dispute between partners, courts will look to the Partnership Agreement for guidance. The law provides great latitude and in most circumstances, will follow the terms of the Partnership Agreement, even if it is substantially different from the default Partnership structure under California Law.
For business associations that do not have a valid Partnership Agreement with clear terms, the courts are forced to fall back on the Corporations Code and the Universal Partnership Act, a series of laws enacted in 1994, which may not consider the unique and complex circumstances of your business. Under the Corporations Code and UPA, the court will presume that there is a general partnership, where each party shares in profits and obligations equally. This often happens without regard to past contributions, or degree of legal responsibility in a lawsuit.
420 College is committed to helping our clients to achieve business success and is pleased to offer assistance with Partnership Agreements as part of our comprehensive Business Services Program. Our team of professionals will help to create a Partnership Agreement that reflects the unique characteristics of your business. Some of our fully-integrated services include:
Consultation and with leading cannabis professional and licensed attorney;
Review of draft agreements;
Assistance with preparation of individualized Partnership Agreements;
Formation of Partnerships between individuals and/or between entities (corporations etc.).
Contact 420 College for an individual consultation and see your business vision come to life!