Partnership Dissolution in UK Law

This is because, while partnership is a consensual arrangement based on agreement, it is more than a simple contract (to use the expression of Dixon J. in McDonald v. Dennys Lascelles Ltd); it is a continuing personal as well as commercial relationship.

Suppose that, by March in a particular year, partner B had so conducted himself as to render it impracticable for partner A to continue in partnership with him. Nonetheless, partner A soldiered on for three months before deciding to throw in the towel and seek a dissolution under Section 35(d). His 'soldiering on' might in contractual terms have amounted to an affirmation, after conduct putting him to an election to determine or to carry on with the contract.

The reason is quite simply that partnership property within s.20 Partnership Act 1890 includes that to which a partner is entitled and which all the partners expressly or by implication agree should, as between themselves, be treated as partnership property. It is immaterial, as between the partners, whether it can be assigned by the partner in whose name it stands to the partners jointly.

The second strand raises the question whether the renewal obtained by the partner for his own benefit was obtained or received by use or by reason of his fiduciary position or of any opportunity or knowledge resulting from it. The successful management or promotion of a boxer is likely to generate goodwill in both the legal as well as the literal sense. But the goodwill and the opportunity and advantage to which it gives rise is the property of the partnership.

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."

But their rights under section 38 are limited by the provision that they may only do so so far as it may be necessary to wind up the affairs of the partnership and, this is the important passage, to complete transactions begun but unfinished at the time of the dissolution, and this is equally true of course of contracts in English law but, as I have said, it is less likely to be necessary to invoke that section.

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.