As the professional services market becomes increasingly competitive, it is important for firms to manage their partners and members to ensure that the firm is operating as an efficient and streamlined business. Whether a partner is underperforming or engaging in activity which is against the firm’s best interests, these issues need to be dealt with effectively and in a discreet and sensitive manner. With the number of law firm mergers on the increase, we are now seeing more examples in post-merger firms where legacy partners are unable (or unwilling) to adapt to the post-merger environment.

In most cases, with careful negotiation we help clients to reach an amicable resolution between the remaining and the departing partners.   Where that is not possible, we are adept at advising on options such as enforced retirement and formal expulsion (with or without cause) under the terms of the LLP members’ agreement or partnership deed. Engaging the formal expulsion or enforced retirement provisions is usually a last resort and can be an uncomfortable experience. We regularly advise firms on how best to manage this process. In the case of a general partnership under the Partnership Act 1890 or where formal expulsion may not be an option under the terms of the partnership agreement, we are able to address the complexities of dissolving a partnership and re-forming as a new entity.

The removal of a partner or member has to be dealt with carefully in order to minimize the risks to the firm and to the remaining partners of exposing themselves to claims such as discrimination, whistleblowing, a breach of the duty of good faith or a claim that the affairs of the partnership are being conducted in an unfairly prejudicial manner.

How Fox & Partners can help…

  • ensuring that your firm has a tightly drafted partnership agreement or LLP members’ agreement which adequately provides for the removal of a partner for unlawful behaviour, underperformance, death or even without cause is key. Whether you are in the process of setting-up or your firm has been running for some time we can assist you to ensure that you have a carefully drafted partnership agreement or LLP members’ agreement which protects the best interests of the firm
  • we can advise on the strategy for expelling or removing a partner and either advise the firm in the background or take the lead during negotiations
  • where an amicable resolution is not achievable we have strong experience of litigating partnership disputes (see Partnership, LLPs and Limited Partnerships).

Please call us on 020 7618 2400