Partnership Agreement Theory

The overall theory of partnership is based on the definition of a partnership, „an association of two or more people who continue to co-own a business for profit.” The definition does not say a separate entity, it is called „… two or more people … ». This approach influences several business principles, including: in Ohio, revised code 1775.26 allows one partner to transfer its shares to another and give the agent the opportunity to benefit from the partner`s interest in the partnership, while excluding the agent from participating in the management of partnership business. Section 27 of the Uniform Partnership Act is based on early jurisprudence that says that in the development of the 1914 UPA, a debate raged about the theory to be adopted. The authors resolved the debate through a compromise. In paragraph 6, paragraph 1, the UPA contains a neutral definition of partnership („an association of two or more persons who, as co-owners, a profit-making business”) and maintained the common law theory that a partnership is an aggregation of individuals – the global theoretical theory that a business is not an entity, but a collection of individual owners who attach themselves. On the other hand, the overall approach is appropriate when it comes to issues of ownership and transfer of property rights between the relevant partners. Remember, a partnership is a VOLUNTARY association of individuals and no partner should or can be forced to associate someone or work with someone with whom he or she disagrees. In the corporate unit format, a shareholder can freely sell his or her ownership shares to anyone (small businesses can limit that right by shareholder agreement). In the event of a dispute, the aggregate theory causes some inconvenience in the designation and service of the accused: under the UPA, complaints must be filed to enforce a partnership contract or other right on behalf of all partners. Similarly, in order to pursue a partnership, the applicant must nominate and prosecute each of the partners. This cumbersome procedure has been amended in many states that have adopted specific statutes expressly authorizing legal actions against and against partnerships in the company`s name.

In legal actions before the federal court, a partnership can be sued and sued on its common behalf. RUPA`s approach to seeking partnerships has not changed much. Admittedly, it provides that a „partnership can be pursued and pursued in the name of partnership” – it is convenient if the complainant hopes for a verdict against the partnership without resorting to the personal fortune of each partner. RUPA, Section 307 (a). However, an applicant must individually designate the company and the partners in order to have access to the two rebates, the partnership and the individuals: „A judgment against a partnership is not in itself a judgment against a partner. A judgment against a partnership cannot be satisfied by a partner`s assets, unless there is a judgment against the partner. RUPA, Section 307 (c).