This document is a clause which can be used in a partnership agreement, in order to make the partnership a limited liability partnership.
Limited liability partnerships are governed by the Partnership Act of each state and territory in Australia. It is important for practitioners to familiarise themselves with the relevant legislation when negotiating and drafting the terms of partnerships.
A limited partnership requires one general partner and one limited partner. The amount of general partners should not exceed 20, although exceptions may apply. There is no limit on the number of limited partners. A limited partner means a partner in a limited partnership whose liability for the liabilities of the partnership is limited under statute.
Limited liability partnerships, including details of the limitation of liability pertinent to each limited partner, must be registered in accordance with the relevant act. In Victoria, for example, limited partnerships must be registered with Consumer Affairs Victoria.
Using this precedent
This optional clause can be added to a partnership agreement. This clause could also be used to add limitation provisions to the separate precedent “Partnership agreement (short form, general)”.
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 LexisNexis by Elise Margow, Principal, Legally Speaking.
This document is prepared with the assistance of Specialist Editor Stephen Newman, Executive Counsel, Ponte Earle.