Also known as: at will nature of partnerships · at-will partnership · partnership at will · at-will partnership doctrine
Written by attorneys · grounded in primary & secondary sources — see below
A principle permitting any partner to dissociate from the partnership at any time by express will when the partners have not agreed to remain partners until the expiration of a definite term or the completion of a particular undertaking. Dissociation under this principle triggers dissolution and winding up upon notice to the partnership.
Alexis Archer and Aaron Adams formed a partnership at will to run a local delivery service with no agreed term. After several months of disagreements, Alexis sent Aaron a letter stating her express will to withdraw immediately. Upon receiving the letter, the partnership dissolved by operation of law, requiring the business to wind up and account for all assets and liabilities as of that date.
Andrew Avery and Amelia Amari formed a partnership to operate a laundry business with no definite term specified in their agreement. When Andrew sought to end the relationship due to shifting market conditions, Amelia could not force continuation. Andrew's dissociation took effect upon notice, leaving the partners free to separate without liability for the act of withdrawal itself.
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In an at-will partnership, a partner may withdraw by express will at any time and the dissociation is rightful. In a definite-term or particular-undertaking partnership, an early withdrawal by express will is wrongful and exposes the partner to damages liability.
Supporting sources
Dissolution occurs when the partnership knows or has notice of a partner's express will to withdraw. If the partner specifies a later date, dissolution takes effect on that later date instead.
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No. Partners always retain the power to dissociate by express will regardless of any agreement language attempting to restrict withdrawal. An agreement may affect whether the dissociation is wrongful but cannot eliminate the power itself.
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No. The statute focuses solely on whether notice of express will to withdraw has been given. Later conduct by the withdrawing partner or the remaining partners does not alter the dissolution date fixed by the notice.
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…for the continuance of said partnership, nor upon any particular undertaking to be accomplished; that the said partnership was a partnership at will.” From this finding the court concluded that plaintiff was entitled to a dissolution under section 2425, subdivision (1) (b), of the Civil Code. The court further found that the parties…