Limited Partnerships

The partnership legislation of Queensland, Western Australia, Tasmania and New South Wales each provides for a limited partnership, which enable partners who do not take an active part in the management of the business to limit their liability.

Practice area overview

A limited liability partnership (LLP) can be formed under Part 3 of the Partnership Act 1892 (New South Wales) (Partnership Act). A partner in a partnership that is not formed as an LLP is jointly and severally liable for all the debts of that partnership. That liability cannot be limited. In the case of an LLP the liability of a limited partner in the LLP is limited (to the amount that the limited partner agreed to contribute to the LLP) but only if the limited partner does not take part in the management of the LLP. In that case the limited partner loses the benefit of limited liability during the time that the limited partner took part in the management of the business.

Formation of an LLP is a relatively straight forward process and occurs upon lodgement with the Registrar of a statement signed by each proposed partner (Statement) which must provide certain information including:

Other features of a partnership are:

• The name, address, date and place of birth of each partner;
• Whether the partner is a ‘general’ or ‘limited’ partner;
• The amount which a limited partner has agreed to contribute to the LLP; and
• Any conditions relating to the cessation of the LLP.

 

What we do

We can help you by:

• Advising you on the features and benefits of a LLP for you as opposed to other business entities and structures.
• Write a LLP agreement to meet your requirements.
• Advise and write for you procedures and documents required for management of your LLP.
• Advise you on and write subsequent amendments to your LLP agreement.
• Advise you as to the rights and obligations of the limited and general partner(s).
• Advise you as to the rights and obligations of the general partner(s).