Legal Question in Business Law in California

Read the terms of your partnership agreement. Probably yes.

Corporations Code section 16401, subdivision (i) says "A person may become a partner only with the consent of all of the partners." Although this provision can be modified by the partnership agreement, the general rule is that any new partner must be approved unanimously. So, I would say the answer is "No, unless......"

As a Franchise Attorney I agree with the second attorney answer. As pointed out, the legal presumption is only with the consent of the other partners. Of course, this presumption can be modified by the partnership agreement - but this is rare. It is also likely the partnership agreement gives the other partners a "right of first refusal" to purchase the interest you want to sell. Consult with a good business or franchise attorney in your area for specific advice.

Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.

Franchise Foundations, a Professional Corporation

Of course not. Even if your partnership agreement said you could, it would likely result in litigation to dissolve the partnership. You must work this out to the satisfaction of all partners in order to do so, whether by selling, buying out, etc. If serious about hiring counsel to help you in this, feel free to contact me.

For all intents and purposes, we believe that you cannot do so despite a written provision in the partnership contract that you may sell your shares without prior notice. The essence of a partnership comes into consideration the personal/professional relationship between partners. Severing this tie, especially without notice to the other party, may just result in the dissolution of the partnership.

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