Formation of Partnership in UK Law

I have detailed the matters above and do not need to repeat them all, but Mr Bishop's persistent obstructiveness in co-operating in having accounts drawn up and agreed; his ignoring of Mr Golstein in making unilateral decisions in relation to the partnership premises, the staff, and other matters; and his undermining of Mr Golstein's position in the firm in my judgment cumulatively meant that it was not reasonably practicable for Mr Golstein to carry on practice in partnership with him.

In the current (eighteenth) edition of Lindley & Banks on Partnership, the topic of "partnership shares" is dealt with in Chapter 19. Lord Lindley's "classic definition" is quoted in paragraph 19–05. He said that "the share of a partner is his proportion of the partnership assets after they have been all realised and converted into money, and all the debts and liabilities have been paid and discharged."

Although it is both customary and convenient to speak of a partner's "share" of the partnership assets, that is not a truly accurate description of his interest in them, at all events so long as the partnership is a going concern.

Fifth, such a trust is akin to a "retention of title" clause, enabling the recipient to have recourse to the payer's money for the particular purpose specified but without entrenching on the payer's property rights more than necessary to enable the purpose to be achieved. It is not as such a "purpose" trust of which the recipient is a trustee, the beneficial interest in the money reverting to the payer if the purpose is incapable of achievement.

It is also immediately plain that the tax avoidance scheme, if it worked, would be singularly attractive to any person in the position of the Claimant, that is, any resident of the UK who, as a self-employed person, carried on a trade or profession here.

The important thing to ascertain is the meaning of the word "person" in the vocabulary of the Income Tax Acts. The word constantly occurs throughout the Acts, and I think that it is most generally used to denote what may be termed an entity of assessment, i.e., the possessor or recipient of an income which the Acts require to be separately assessed for tax purposes.

There was one feature of the context to the agreement between the two men which was determinative, namely the need for a solicitor's practice to comply with rule 13 of the Rules of 1990. Its effect was that the firm could lawfully practise between March 2002 and November 2002 only if Mr Lees was a partner in it. The evidence of both men was that it was in order to comply with rule 13 that they entered into the agreement and indeed that Mr Lees became associated with the firm at all.