This document is a clause which can be inserted into a partnership agreement.
The partnership relationship is a branch of agency law. Each partner is agent and principal of the others, and owes fiduciary obligations to the others. In this environment, it is very important that the partnership business not only keeps proper books of account, but also that these books of account are kept in a central place, where access is available to all partners. This is not only good business practice, but should be a fundamental right of partners.
Partners should be able to review at any time the assets, liabilities and other relevant financial information about the business, as legally they are personally liable for the financial affairs of the business.
Using this precedent
This clause can be used to add detailed accounting provisions to the “Partnership agreement (short form, general)”, or can be inserted into any partnership agreement as required.
When inserting this optional clause into an agreement, care must be taken to ensure that the agreement remains consistent. Cross-references, definitions and schedules should all be checked.
This document has been authored for Lexis Nexis by Michael Heraghty, Partner, TressCox Lawyers, Rosemarie Ryan, Barrister and Elise Margow, Principal Legally Speaking.
This document is prepared with the assistance of Specialist Editor Stephen Newman, Executive Counsel, Ponte Earle.