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Many written partnership agreements set forth a “term” of the partnership and a specific date in the future that the partnership agreement will “expire.”  Often the partners of a business forget that they included the expiration date in their partnership agreement and only realize that their partnership agreement has expired when they review the agreement after a dispute has arisen. In New Jersey, the Uniform Partnership Act states that: If a partnership for a definite

In addition to the obligations set forth in a partnership agreement, partners owe to the partnership and their other partner(s) certain fiduciary duties called the “duty of care” and the “duty of loyalty.”  To satisfy one’s duty of care in connection with the partnership business, a partner shall refrain from “engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.”  N.J.S.A. 42:1A-24(c). To satisfy a partner’s duty of loyalty, the

It is always advisable to have your business contracts in writing and signed by all parties (‘as we discussed in this prior blog post Tip #1 To Help Your Company Avoid, Or Reduce The Cost Of, Business Disputes: Always Use Written Agreements‘).  Even if you are comfortable with informal oral agreements, under New Jersey law, there are certain contracts that need to be in writing.  For example, under a statute called the Statute of Frauds,

If you are a minority shareholder of a corporation or a minority member of a limited liability company and you are thinking about bringing a lawsuit against the majority shareholder(s)/member(s), it is important to determine whether the lawsuit would be: (1) a direct action; or (2) a derivative action. This determination is critical because the two types of claims have different elements of proof and different procedural prerequisites. To maintain a direct action, the plaintiff

In New Jersey, the Uniform Partnership Act defines “partnership property” as property in the name of: the partnership; or one or more partners with an indication in the instrument transferring title to the property of the person’s capacity as a partner or of the existence of a partnership but without an indication of the name of the partnership. Additionally, property is presumed to be partnership property if it is purchased with partnership assets. For example,