51 - The problem with unwritten partnership agreements

When Informal Deals Become Legal Partnerships Host Melissa Bush explains that under Australian law, a partnership can exist without a written agreement if people carry on a business in common with a view to profit, and courts determine this from conduct and evidence such as profit sharing, control, contributions, records, and representations to others. She outlines major consequences, including partners acting as agents who can bind each other, joint and several personal liability for debts, and fiduciary duties. The episode discusses Hallam v Tancred, where an arrangement labelled as employment was found on appeal to have partnership hallmarks, and a NSW cafe dispute case (Pitac v Sdo) showing vague informal understandings and undocumented cash claims failing against formal company records. Bush covers dissolution, valuation, death of a partner, and urges documenting contributions, profit distribution, decision-making, exit and valuation mechanisms, estate planning alignment, and tax considerations through a formal partnership deed.

00:00 Handshake Deals Risk

01:29 Show Intro Disclaimer

02:37 Partnership Basics NSW

04:11 Legal Consequences Partners

05:21 Case Hallam Tancred

07:11 Cafe Dispute Case

09:41 Exit Without Agreement

11:33 Hidden Liability Risks

12:41 Death Estate Issues

13:49 Why Avoid Agreements

14:49 How To Protect Yourself

16:14 Key Takeaways Wrap

17:29 Final Call To Action