- 5 Marks
Question
Comment on the legality of the following relationships operating as partnerships:
i. A partnership of 16 persons established for charitable purposes
ii. Adex cooperative society consisting of 500 members
iii. Black and Blue law firm consisting of 31 lawyers
iv. Stone Partnership firm comprising Segun aged 28, Tunde aged 17
v. A partnership of volunteers for the purpose of helping persons displaced by flood.
Answer
i. Partnership of 16 Persons for Charitable Purposes
This arrangement is legal as a charitable organization but does not qualify as a typical partnership under partnership law, which typically requires an intent to carry on a business for profit. A partnership solely for charitable purposes may be registered under charity law rather than partnership law.
ii. Adex Cooperative Society of 500 Members
A cooperative society with 500 members does not qualify as a partnership. Under most jurisdictions, partnerships are limited to 20 members in ordinary businesses, except for certain professions. Cooperative societies are distinct legal entities governed by cooperative society laws, not partnership laws.
iii. Black and Blue Law Firm of 31 Lawyers
This arrangement is legal. Law firms are an exception to the general rule limiting partnerships to 20 members, allowing for larger partnerships in the legal profession. Therefore, a law firm with 31 lawyers is permitted and does not breach partnership regulations.
iv. Stone Partnership with Segun (28 years) and Tunde (17 years)
This partnership raises legal concerns as Tunde, being a minor, may lack the legal capacity to form a binding partnership. Minors can participate in partnerships with limited rights, but they are typically not fully liable for partnership obligations. The partnership can exist, but special care is required to handle the minor’s legal capacity.
v. Partnership of Volunteers for Flood Relief
This arrangement does not constitute a legal partnership, as it lacks a profit motive, which is a fundamental element of partnerships. The group of volunteers may legally operate as an unincorporated association but would not be recognized as a partnership under partnership law.
- Tags: Charitable Purpose, Cooperative Society, Law Firm, Legal Entity, Minor Partnership, Partnership, Volunteers
- Level: Level 1
- Topic: Partnership Law
- Series: NOV 2020
- Uploader: Dotse