Dental Tribune UK Edition, October 11-17, 2010, No.25 Vol.4

21Money MattersOctober 11-17, 2010United Kingdom Edition Quality. Security. Schülke. Protecting you throughout your working day The industry standard in Infection control product solutions. Schülke & Mayr UK Ltd. Sheffield S9 1AT | United Kingdom Phone +44-1142-54 35-00 | Fax -01 www.schuelke.com R unning a successful den- tal practice with another clinician or registered dental professional involves nu- merous legal issues that need to be properly considered, dis- cussed and incorporated into a suitable agreement. Of course, we all enter into professional partnerships with the best inten- tions, but unfortunately some- times despite all our efforts, things do not always work out as we had planned. Even if your business part- nership has been happily built on mutual trust, understanding or even friendship, all eventuali- ties should never be ruled out. To avoid ending up in a sticky legal situation or leaving your depend- ants in a mess, the importance of having a clear, up-to-date part- nership agreement in the dental practice cannot be overstated. As all dental professionals will appreciate, prevention is better than cure. So which aspects should be discussed with your business partner(s) and drawn up into a written agreement? Situations such as expulsion and retire- ment, prolonged absence due to accident or ill health and even death need to be taken into con- sideration with details of the roles of all parties detailed for clarity so that everyone under- stands their responsibilities be- fore a problem arises. This will serve as a legal safeguard against disputes about profit shares, property ownership, and entitle- ment to leave and so on. And of course, it is always easier to con- front these issues with a clear head in an unbiased manner rather than after a disagreement has already arisen. Many practitioners are una- ware that without a current up- to-date agreement, legally the partnership will fall into the cat- egory of a ‘partnership at will’, subjected to outdated statutory provisions which may not reflect the wishes and interests of all those involved. What’s more, a ‘partnership at will’ can also be dissolved with immediate effect by any partner, possibly even re- sulting in the termination of the PCT contract. Likewise, if a part- ner in a ‘partnership at will’ re- tires or dies, this also has the ef- fect of dissolving the partnership as a whole, the results of which can be potentially devastating for the remaining partner or part- ners. Astonishingly the provi- sions of the Partnership Act 1890 that provide the implied terms in a partnership at will contain no provision enabling the expulsion of a delinquent partner. A watertight agreement drafted by an expert in dental law is not only a legal asset, but also a financial one. In the event of a tax dispute with the Inland Revenue, having an agreement in place will give your practice credibility and will be evidence of the arrangements in place. Even if a partnership agree- ment has already been put into place, it is essential to keep it updated. It is worth taking extra care when a new member joins the partnership, as unless the agreement is renewed in a timely manner, the partnership at will situation arises once again and the prior agreement will no long- er be recognised as a valid legal document. A qualified solici- tor can help properly draft and amend partnership agreements and avoid the perils of a serious dispute occurring or an expen- sive civil litigation in the courts. However, it is a sad fact that some partnerships do fail, and in this situation it is important to be aware of the proper steps and precautions that need to be taken in order to ensure that neither party gets their fingers burnt. Without provisions in a Partner- ship agreement to the contrary, a notice of dissolution can be is- sued by any partner and without the need to state their reason for doing so. Once already begun, the process cannot be reversed with- out the consent of all partners. When faced with dissolution, the settlement of shared finances is a priority. Firstly, any liabilities are paid, then capital, and in the event of a shortfall, debts will be payable by the partners person- ally according to their partner- ship share. Deciding what should happen to your business in a worst-case scenario can be an arduous task fraught with diffi- culties and disagreements. Good legal assistance can smooth the way to ensure that everything is processed quickly and fairly. From the drafting of contracts to dealing with partnership dissolu- tion, solicitors such as Goodman Legal – Lawyers for Dentists will help to make sure the procedure is as pain-free as possible. For more information please contact Ray Goodman, Goodman Legal, Lawyers for Dentists on 0151 707 0090, email rng@good- manlegal.co.uk or visit www. goodmanlegal.co.uk DT Partnership agree- ments and dissolution Ray Goodman talks partnerships About the author Raymond Good- man, Senior Part- ner Ray Goodman is a Member of the Association of Spe- cialist Providers for Dentists (ASPD), legal member of NASDA (National Association of Den- tal Accountants) and included on the BDA list of recommended dental solicitors. He has a comprehensive understanding of the commercial and professional objectives of Dental Prac- tices, along with l the relevant legal re- quirements. In his spare time, Ray has ambitions to be the next Eric Clapton. ‘ It is important to be aware of the proper steps and precautions that need to be taken in order to ensure that neither party gets their fingers burnt. ’ The key to a successful practice is prevention, trust and understanding