BUSINESS AND CORPORATE LAW BUSINESS AND CORPORATE LAW Name of the Student Name

Running head: BUSINESS AND CORPORATE LAW
BUSINESS AND CORPORATE LAW
Name of the Student
Name of the University
Author Note

BUSINESS AND CORPORATE LAW1
Question 2.1
Issue
The issue is what can be put in the formal written partnership agreement which have been
made by Rachel and Emily and along with such if they borrow any kind of money from any
financial institution then will they be personally liable for such if they cannot repay it from their
business earnings.
Rule
A partnership form of business structure is considered to be operated when there are two
or more individuals involved to operate the business as all the co-owners share their income. The
partnership form of business structure is governed by the Partnership Act 1963. The partnership
form of business are considered to be less expensive and easier than the other companies to set
up. They carry on the business under their trading name and it is simpler to administer the
business. The profits along with the losses are considered to be shared between the partners. It
can be understood from the case of John Grimes Partnership Limited v Gubbins [2013] EWCA
Civ 37. A partnership firm and would not be liable for any losses. On the other hand, a general
partner would be liable for losses and would also gain profits under the partnership firm.
Application
In this present scenario, it can be said that Rachel and Emily would go into a business as
partners therefore, if they put any formal written partnership agreement then they need to lay
down the kind of partners they would be along with their liabilities. The agreement for
partnership should include partnership shares, partnership assets, Distribution of profits, liability
of partnerships, termination of partners and dispute resolution. Apart from that, if they borrow