partnership agreement

Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states the (1) nature of the business, (2) capital contributed by each partner, and (3) their rights and responsibilities. A partnership does not have a separate legal existence like an incorporated firm, and the partners are jointly and severally liable for the debts of the firm. Even on withdrawing from the partnership they remain liable for already incurred debts, and for future debts unless a proper notice of retirement is published. A valid partnership, however, can exist without a written agreement in which case the provisions of the statutes governing partnerships would apply. Also called agreement of partnership. See also articles of partnership.