Finance: The big breakup
Partnerships can face severe disruption in the event of a death or serious illness for a partner. It pays to plan for those unpleasant eventualities, says Matt Haswell
The death or critical illness of a partner can cause considerable disruption to a law firm’s business, causing emotional turmoil and highlighting potential knowledge gaps as well as having financial implications. There may be debts that are repayable on the incapacitation of a partner, including bank overdrafts, hire purchase agreements, bank loans and a partner’s capital account. The remaining partners will need to decide what happens to the deceased’s share of the business and resolve any issues relating to the partner’s spouse or the deceased’s estate.
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