Legal Question in Business Law in California

Re: Small business partnership agreements

That is interesting that they would not advise you on this. General Partnership statement filings are permissive but not mandatory in California. You probably need to file with your local county or city to obtain a business licensce. Licensure rules are different if you are engaging in specific business practice such as the practice or law, accounting, most "professions" as governed by the business and professions code, and some other activities (hazardous waste, etc). If you think your business might fall into one of these categories, you should consult an attorney for more information.

Re: Small business partnership agreements

I agree with the previous answer, and would like to add a couple of thoughts:

1. The SOS reluctance to advise was possibly due to a policy of avoiding giving what might be construed as legal advice.

2. I'd bet that fewer than 1 in 5 general partnerships is registered. The ones that have registered are probably the larger and better-run ones.

3. I've heard other business lawyers say they would never advise setting up and running a business as a general partnership. This is mostly due to the liability-to-outsiders and liability for the other partner's decisions aspects. I don't necessarily agree, but it's a point of view worth considering.

4. You should have a written partnership agreement.

5. Partnerships, even more than corporations and LLCs, need to carry insurance against insurable business risks, including casualty and liability coverages.