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Why Your Medical Practice Should Have A Written Partnership Agreement

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A partnership exists where a group of people carry on a business with a view to profit.  Although they are often perceived as being simple, partnerships are one of the most complex business structures and are used across a variety of sectors.  One sector in which partnerships are particularly popular is the healthcare sector, where a large number of GP practices operate as partnerships.

hlw Keeble Hawson logoLike any partnership, a GP practice which operates as a partnership will be subject to the Partnership Act 1890, which forms the basis of today’s partnership law.  While the Act covers a number of important issues, some of its provisions are out of date and do not meet the demands of a modern business in the healthcare sector.  For this reason, it is always advisable for the partners at a medical practice to enter into a written partnership agreement to regulate and formalise how the practice operates.  The issues which can be dealt with under a medical practice’s partnership agreement include the following:

  • the practice’s place of business;
  • the partners’ respective contributions to the capital of the practice;
  • the proportions in which the partners own the partnership’s property;
  • how profits and losses will belong to and be borne by the partners;
  • the duties which the partners owe to each other and the practice;
  • how decisions of the partner are to be taken; and
  • the retirement or expulsion of a partner.

If you would like to speak to a member of our Corporate and Business Services team about the possibility of putting a new partnership agreement in place for your medical practice, please contact Rory Conwill on 0114 252 1411 or Sarah Riley on 0114 290 6368.

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