Legal Question in Business Law in California

Re: husband and wife forming partnership

Yes, the interests in profits and/or management and control in a general partnership can be unequal, but in the absence of an express agreement they are likely to be presumed equal, so I recommend having an attorney-drafted partnership agreement that clearly sets forth the intended division of responsibilities, salaries (if any), sharing of profits and losses, and the like.

Such an agreement is likely to be binding only upon the partners; outsiders dealing with the partnership may well be entitled to treat you as equals as far as personal liability, agent's authority to bind the partnership, and similar matters.

Corporations Code section 16401 is a key law setting forth the inherent equality of the partners; however, case law including Constans v. Ross (1951) 106 Cal.App.2d 381 clearly points out the right of partners to carve up the pie unequally if they so choose.

I could not complete my advice without suggesting that you consider a form of organization that provides you some limitation on possible personal liability, such as an LLC. Sure, they have to pay an $800 or more franchise tax every year, but the insurance it provides may be worth it.