Contract Drafting

Partnership Deed

A Partnership defined by the Indian Partnership Act, 1932, as “the relation between persons who have agreed to share profits of the business carried on by all or any of them acting for all”. This definition gives three minimum requirements to constitute a partnership, viz. (i) there must be an agreement entered into orally or in writing by the persons who desire to form a partnership, (ii) the object of the agreement must be to the share the profits of business intended to be carried on by the Partnership and (iii) the business must be carried on by all the partners or by any of them acting for all of them.

The result of this summary of the Act is that a Partnership is generally created by Agreement between the Partners. A Partnership can be formed between (i) one or more individuals or (ii) between an individual and a person representing a H.U.F. or (iii) between an individual and other partner representing his firm or (iv) between two partnership firms (v) or between a Limited Company or a Corporation and an individual or Partnership Firm (vi) between a Partnership and a H.U.F.  (vii) between members of HUF in their individual and independent capacity (viii) between a HUF and member of that HUF independently.

Dissolution

The Act also provides that a Partnership Firm may be dissolved under the following circumstances namely, (a) as a result of any Agreement between all the Partners (b) By adjudication of all the Partners or all Partners but one as insolvent, or (c) by the happening of an event which makes it unlawful for the business of the firm to be carried on in Partnership or (d) subject to Agreement between the parties, on the happening of any of the following events such as – (i) efflux of time, (ii) completion  of the adventure, (ii) death of a partner, and (iv) insolvency of a partner. In these four cases the partnership Agreement may provide whether the firm will be dissolved or not on the happening of any of the four events.

Types of Partnership Deed –

  • Partnership Agreement between two individuals
  • Partnership Agreement between four partners
  • Partnership Agreement between two partnership firms
  • Partnership Agreement between for a single venture
  • Partnership Agreement between partnership firm and a Hindu Joint Family
  • Partnership Agreement between two Limited Companies
  • Partnership Agreement between an individual and a limited Company
  • Partnership Agreement between an individual, a Partnership Firm and a Company
  • Deed of Partnership of H.U.F. business
  • Memorandum of Partnership of H.U.F. Business
  • Agreement admitting a new Partner
  • Agreement admitting a minor to the benefit of Partnership
  • Deed of Retirement
  • Retirement of two partners (with liberty to continuing partners to carry on the business)
  • Deed of Retirement of One Partner and Admission of New Partner
  • Agreement of Dissolution of Partnership (By Sale of Goodwill)
  • Deed of Dissolution of Partnership
  • Agreement of Dissolution of Partnership through an Attorney
  • Agreement for Conversion of a Private Limited Company into a Partnership
  • Deed of Sub Partnership

Building Contract

Building Agreements that is Agreements for construction of buildings and other structural work are also species of ordinary contracts and are basically governed by the Contract Act. Building Agreement or contract is a specie of construction contracts which is a contract by which one party called the contractor undertakes to carryout works for other party who is the employer and generally the owner of the land on which the work is to be carried out the work being the work of erection, alteration repairs or demolition of building and other structures. When contract relates to construction of a building or other structure it is called Building Contract. When it relates to constructions of infrastructures such as roads, bridges, tunnels harbors etc. it is called as a Civil Engineering Contract through in law both are the same. The basic rules for valid contract laid down by the Contract Act in sections 10 to 23 will, therefore, also be applicable to such Agreements, that is to say the parties must have the capacity to Contract, the contract, must be entered into with full consent of the parties, there must be some consideration for the Agreement and it should not be invalid for any of the reasons mentioned in the Contract Act.

Types

  • Invitations to Tenderers
  • General conditions of Contract
  • Letter of Intent
  • Work Order
  • Formal building Agreement between the Owner and Contractor
  • Building Contract
  • Agreement with Architect
  • Assignment of Building Contract by Contractor
  • Assignment of Building Contract by Owner
  • Agreement for Demolition of Building and Sale of Building Material
  • Agreement with Labor Contractor

Trust

A Trust is defined in Section 3 of the Trust Act, 1882 as “an obligation annexed to the ownership of property and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another or of another or of another and the owner. In simple words it is a transfer of property by the owner to another for the benefit of a third person along with or without himself or a declaration by the owner, to hold the property not for himself but for another or for himself and another.

Requirements of a Trust

A trust is not a contract of agency to hold the property, as in that case there would be no transfer of the property. In trust there is a transfer from the owner to the trustee subject to certain terms and conditions. Bailment is also a kind of trust, but in bailment also there is no transfer of any interest in the property, but only a transfer of possession without ownership.

Creation of Trust

A trust of immoveable property can be created by two ways. One by a non-testamentary document and another by a testamentary document such as a will, In other words, a trust regarding an immoveable property cannot be created orally but it must be by a document duly registered.

A person who creates a trust is called the settler, the person to whom the property is transferred on trust is called a trustee and the person for whose benefit the property is transferred is called the beneficiary or ”Cestuique Trust”.

Declaration of Trust

A trust can be also created by the author himself declaring that he would hold the property, not as owner, but as a trustee for the benefit of some person or persons including himself.

A declaration of trust relating to an immoveable property must be registered irrespective of the value of the property as required by section 17 of the Registration Act.

Testamentary Trust

A trust can also be created by a testamentary document that is by Will.

Who can create a Trust

A trust can be created by any person competent to contract or even by a minor with the authority of a competent court and in respect of any property which is transferable and over which the author of the trust has disposing power. (See sections 7 and 8 of the Trust Act).

Trust, Private and Public

A trust may be private or public. When the purpose of the trust is to benefit an individual or a group of individuals or his or their descendants or any legal person and who is capable of holding property, it is a private trust. When the purpose of the trust is to benefit the public or any section of the public, it is a public trust. A trust may be partly private and partly public or it may be private up to a certain time or event, say up to the lifetime of one or more persons and thereafter it may become public.

Registration

Every declaration of trust or deed of trust, private or public will have to be registered under the Registration Act if an immoveable property is the subject matter. But if the trust relates only to moveable property it need not be registered.

A simple deed of appointment of new trustees need not be registered but if it is accompanied by transfer of trust property it will require registration.

Types of Trusts

  • Declaration of Trust (Private)
  • Declaration of Trust (Public)
  • Deed of Private Trust
  • Deed of Public Trust
  • Deed of Public Trust for educational objects
  • Deed of Trust (partly private and partly public) with power to carry on business
  • WakfAlalAulad
  • Deed of Trust of temple property
  • Deed of Family Trust
  • Trust Deed of a Rotary Club
  • Deed of Revocable Trust
  • Deed of Revocation of Trust
  • Deed of Appointment of New Trusts
  • Deed of Appointment of New Trustee without transfer of property

Memorandum of Understanding

An MOU is signals a legal Contract are imminent. MOU is a legal document prepared in the formation and registration process for Limited Liability Company do defined its relationship and shareholder and the same it is a understanding of terms and conditions between the two or more parties. Its indicating and intended a common line of action. It is a first stage in the formation of Contract or Both the parties its represents understanding of both the parties mutually accepted expectation each other. While MOU is not legally binding, it can help two parties move in the right direction towards An Agreement.

Agreements regarding the time line for when the MOU takes the effect are discussed. Agreements outlining how or when a party can terminate, the understanding are also decided. This is when a party puts in disclaimers, restrictions or privacy statements as desired. Once discussion is finished, a final MOU is drafted and signed.