On partnerships, promises and succession

Brown, Jonathan (2023) On partnerships, promises and succession. Juridical Review, 2023 (3/4). pp. 121-138. ISSN 0022-6785

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Abstract

Business partnerships, or ‘firms’, in Scotland are ‘legal person[s] distinct from the partners of whom [they are] composed’. Nonetheless, they lack many 'incidents of [corporate] personhood', such as 'perpetual succession', with the effect that every change of membership involves 'the dissolution of an old and the simultaneous creation of a new [partnership]’. If a firm ceased to be whenever there were any change in membership, however, partnerships would be afforded an easy way to prejudice their creditors. The ‘prime principle’ that operates across this area of law holds that this should not be allowed. In 2011, Lord Hodge sought to rationalise this presumption with reference to the law of unilateral promise. This article questions this ‘conjecture’ in light of subsequent promise cases and suggests, as an alternative that Scots lawyers might draw lessons in this area from the law of the succession of so-called 'natural' legal persons.

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