Legal Updates

One who claims existence of a partnership need show it by ‎extrinsic evidence

May 19, 2016
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As part of an unwritten agreement between the parties one party transferred funds to the other. The other party refused to repay the funds arguing that it was transferred to a partnership established by the parties and the partnership lost the funds.

The court held that partnership is an association of people that partnered in order to run a business for profit. The burden of proof to show the existence of a partnership is on the party arguing that it exists. In order to prove that this was a partnership, beyond a general statement, the party who claims so need bring extrinsic evidence such as a written agreement or other document evidencing a partnership, a reference to the transfer of funds or of a bank account of the partnership and showing that the partners shared profits and losses, show of joint management of a business or the representation to other of the parties as partners. Because the party could not prove the existence of a partnership, the Court ordered repayment of the funds.