As a business owner, it is critical to protect yourself and your company from any potential legal issues that may arise. One of the ways to do this is by having a solid partnership agreement in place. However, what happens if you don`t have a signed partnership agreement? Can it still be enforced? The answer is yes.
An unsigned partnership agreement, also known as an oral partnership agreement, is still legally enforceable under certain circumstances. In the absence of a written agreement, the partnership will be governed by the provisions of the state`s partnership laws. These laws typically include rules regarding profit sharing, management decisions, liability, and more.
In some cases, the terms of the agreement might be established through emails, text messages, or other forms of communication. If the court finds that there was a clear and definite understanding between the partners, it may enforce these oral agreements.
It`s important to note that an oral agreement may be difficult to prove in court. This is why having a written partnership agreement is always recommended. A written agreement clearly outlines the terms of the partnership and avoids any misunderstandings that may arise in the future.
In addition to protecting your business, a written partnership agreement can also serve as a valuable tool for resolving disputes between partners. The agreement can include provisions for how disagreements will be resolved, whether through mediation, arbitration, or another method.
In conclusion, while an unsigned partnership agreement may be enforceable under certain circumstances, it`s always best to have a written agreement in place. This protects your business and ensures that all parties involved are on the same page. If you`re unsure of whether your partnership agreement is legally enforceable, it`s always best to consult with a legal professional.