Partner ship dispute
5 months ago
I am a partner in a partnership firm . I the partnership is at will . Other partners are harassing me and not letting me work from the place of business . I will dissolve the firm as it is at will . It is a registered partnership. I want to make sure that the other also don’t do business and the property is sealed off after dissolution. Is it possible ? It’s a potato cold storage . Can I dissolve the firm ? There is an arbitration clause with requires consent of all partners . My share is 15% ? Can a person with such low share stop the business altogether?
A.Dear Client,
The percentage of shares in a partnership firm is irrelevant if the dispute arises out of any violation or breach of any terms and conditions of a partnership deed that governs the relationship and accountability of partners. To dissolve a partnership firm in compliance with the provision of the partnership deed, a unanimous resolution between all the partners is required. However, when a provision for resolving the dispute through arbitration under the Arbitration and Conciliation Act, 1996 exists in the deed of partnership without exhausting the remedies to resolve the dispute, the application for dissolution of the partnership firm may or may not be allowed by the Registrar of Firms. A Notice under Section 21 of the Arbitration and Conciliation Act, 1996 is mandatory before referring the disputes to Arbitration. Under Section 11(6) of the Act, for the appointment of an arbitrator, the limitation period of three years for filing such an application would commence from the date when the cause of action arose. An arbitral award is final and binding upon the parties unless challenged by Section 34 of the Act. It is equivalent to a decree passed by a Civil Judge and is binding upon the parties. The enforcement procedure and execution decrees and an arbitral award in India are governed as per the provision of the Arbitration and Conciliation Act, 1996. Once the time for making an application to set aside the arbitral award under section 34 has expired or such an application has been refused, the award becomes final and binding on the parties.
The percentage of shares in a partnership firm is irrelevant if the dispute arises out of any violation or breach of any terms and conditions of a partnership deed that governs the relationship and accountability of partners. To dissolve a partnership firm in compliance with the provision of the partnership deed, a unanimous resolution between all the partners is required. However, when a provision for resolving the dispute through arbitration under the Arbitration and Conciliation Act, 1996 exists in the deed of partnership without exhausting the remedies to resolve the dispute, the application for dissolution of the partnership firm may or may not be allowed by the Registrar of Firms. A Notice under Section 21 of the Arbitration and Conciliation Act, 1996 is mandatory before referring the disputes to Arbitration. Under Section 11(6) of the Act, for the appointment of an arbitrator, the limitation period of three years for filing such an application would commence from the date when the cause of action arose. An arbitral award is final and binding upon the parties unless challenged by Section 34 of the Act. It is equivalent to a decree passed by a Civil Judge and is binding upon the parties. The enforcement procedure and execution decrees and an arbitral award in India are governed as per the provision of the Arbitration and Conciliation Act, 1996. Once the time for making an application to set aside the arbitral award under section 34 has expired or such an application has been refused, the award becomes final and binding on the parties.
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A.Dear Client,
The presence of an arbitration clause means that disputes might need to be resolved through arbitration rather than through traditional legal channels. We need to carefully review the terms of the arbitration clause to understand its implications and whether it allows for dissolution without the consent of all partners. If there's a dispute regarding the dissolution and if the arbitration clause requires unanimous consent, it might be challenging to unilaterally stop the business and seal the property.
The presence of an arbitration clause means that disputes might need to be resolved through arbitration rather than through traditional legal channels. We need to carefully review the terms of the arbitration clause to understand its implications and whether it allows for dissolution without the consent of all partners. If there's a dispute regarding the dissolution and if the arbitration clause requires unanimous consent, it might be challenging to unilaterally stop the business and seal the property.
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