Limited liability partnership agreements

The following Corporate practice note provides comprehensive and up to date legal information covering:

  • Limited liability partnership agreements
  • Default provisions
  • Common provisions in an LLP agreement
  • Parties
  • Commencement and duration
  • LLP name
  • Nature and location of LLP's business
  • LLP property
  • Capital contributions and loans
  • Profits and distributions
  • More...

Limited liability partnership agreements

It will almost always be advisable for the partners of a limited liability partnership (LLP) to enter into a limited liability partnership agreement in order to avoid the application of any inappropriate default provisions in the Limited Liability Partnerships Act 2000 (LLPA 2000) or to supplement the statutory provisions where they are insufficient.

Default provisions

The Limited Liability Partnerships Regulations 2001 (LLPR 2001) set out default provisions that will apply to the operation of an LLP in the absence of any specific agreement to the contrary. These are as follows:

  1. all members share equally in the capital and profits of the LLP (losses are not included in this provision as an LLP, as a body corporate separate from its members, bears its own losses)

  2. the LLP must indemnify any member for payments and liabilities incurred in the ordinary and proper conduct of the LLP’s business or in or about anything necessarily done for the preservation of the LLP’s business or property

  3. every member may take part in the management of the LLP’s business

  4. no member is entitled to any remuneration for acting in the business or management of the LLP

  5. no person may be introduced as a member or voluntarily assign an interest in the LLP without the consent of all existing members

  6. any differences as to ordinary matters connected with the LLP’s

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