speaker1: No one ,

we deal with the internal dimension of company law in company law ,

one internal dimensional company law ,
and that's why we'll be looking at company constitutions what do the agents do ,
the reliability of the company for its servants .
All this ,
therefore ,
is internal to the company ,
including things like the fights between the majority and the minority .
Now .
So ,
um ,
so there are some which keep coming up in litigation and that is going to court .
Um ,
and but you will see even more issues when you go into company law ,
too ,
a company law who deals a lot with the external dimensions of the company ,
for example ,
of funding the company ,
getting money for the company to operate ,
whether the money comes in an exchange for shares or whether it is in the form of
debts now ,
um ,
that is something that ,
um ,
right now ,
we are very conscious of in the global community because ,
as you know ,
there are a good number of failing companies around the world ,
including two very ,
very large property development properties in china and with no funny tax in hong
kong .
Insofar as these companies or related companies have got assets in hong kong ,
you will find that there are litigation dealing with pets in hong kong .
And what happens to the companies that hold the assets ?
Um ,
which by which you repay the debts right ?
Which then leads on to the question ,
if a company is in distress financial distress meaning that it can't pay its debts has
become due .
What do you do about it ?
Okay what do we do about it ?
So that's essentially what you will see ,
company law tool and the feedback from my students ,
um ,
who have gone out into practice ,
is that they have ,
they have found both parts very useful for practice ,
especially in internships and they found that the bosses or the partners in the law firms
were quite impressed ,
and they could basically i'll just get going to do work because they knew enough of
the material in these two parts of company .
Um ,
so ,
in other words ,
therefore ,
from what we call a bread and butter perspective ,
in terms of your employability these two parts are actually very ,
very useful .
Um ,
but as a professor ,
i am interested in that ,
of course ,
that's how i structure the course to make sure that it is useful for you when you go into
your internships when you go into the practice .
So that's one of my purposes ,
of course ,
because for me as a professor ,
i can theorize all i want and i still get paid for it .
Okay but if you go into practice and you start theorizing and the client starts asking ,
so ,
lawyer ,
what is the answer ?
And you can't give the answer a solution ,
then you're not very good .
lawyer :
okay so which comes to my second point ,
right .
So apart from learning knowledge ,
which is useful for you when you go into your internships and when you go into your
employment ,
is this :
make sure that you know how to use your knowledge in order to use your knowledge .
Well ,
okay the analogy i use is ,
if you want to learn tennis ,
you don't just watch somebody on tv .
Um ,
if you want to learn tennis ,
you don't just watch somebody on youtube .
I'm teaching you how to ,
um ,
play tennis .
You need to go into the tennis court to practice ,
um ,
with a tennis racket and a tennis ball ,
to know which record is good ,
what kind of strings are suitable for you and how .
Then you build that memory ,
muscle memory ,
into your body to play tennis as well .
In the same way ,
when you want to get deep into any subject matter ,
whether it is law ,
whether it is tennis ,
whether it is chess ,
um ,
whether it's a game or employment ,
you need to practice enough for that and to like it enough ,
right ?
Because if you don't like tennis and your mom forces you to play tennis because it's
just fashionable to play tennis ,
then the moment you have a chance not to play tennis ,
then it's just very sad .
You just kind of bend it .
So all the tuition that you pay basically just goes down the drain ,
which is basically what happens with many of you with regard to music ,
because your parents forced you to play the piano ,
you forced you to play the violin .
You didn't like it .
You practiced because you had the examinations but you didn't really like it .
So the moment you knew you had a chance ,
you just let me go ,
right ?
And if i ask you now to come ,
can you just play us a tune ?
You won't be comfortable doing that ,
right ?
So ,
so ,
um ,
so what i'm coming to is ,
in order to kind of practice ,
to get into the subject ,
to get mastery over it .
You ,
you ,
you have to like it enough .
Okay you have to like it enough to do that .
So ,
um ,
you know my ,
myself enough in the tutorials as well as lectures .
I don't force anybody to do anything ,
right .
I'm here to help you to build yourself up so that you are employable so that you're
very useful to yourself as well as your employers but if you choose not to spend the
time ,
um ,
applying yourself and practicing that's to your own detriment it's not to my detriment
okay so ,
um ,
so ,
so that the facility i provide for you ,
um ,
i'm quite open to students asking me questions ,
hopefully after class ,
because during the break i need to rest my voice .
I won't try to entertain questions during the break up to the point that i said enough ,
i can't do it anymore but i'm happy to answer questions to help you to grow ,
to help you to get mastery over the subject matter .
But you ,
you need to kind of get into the method yourself if you like it enough okay so that's
the second point that's the second point i want to address to you ,
which is that not only do you need to have knowledge that's not the issue ,
you can easily find knowledge on the internet .
You need to have mastery over it and a mastery over ,
um ,
the subject matter .
You like it enough .
Okay so that's part of my job ,
i hope to help you to learn the subject enough ,
right ?
Um ,
if this subject can be very dry ,
if it's just read from a textbook okay so what ?
So i always ask myself when the internet came along .
So why am i what what do i do once i function in a lecture ?
Because actually if you go and search on the internet ,
you can actually find lectures on company law ,
on contract law ,
etc .
Right ?
So i've asked myself that question .
What ,
what ,
what value can i provide for my students when i come into the lecture so that they
can't get it elsewhere ?
Right ?
So in mind ,
if you want to ,
of course ,
you can skip all the lectures and just use the textbook you can do that ,
right ?
Um ,
so ,
um ,
the substance is kind of there ,
right ?
But i give you points of emphasis .
These points of emphasis are like building a building .
So if you look at this room ,
for example ,
if you build this group ,
this lecture theater here ,
you wouldn't start off with the purple panels on the side ,
right ?
You wouldn't start off with the air vents on the left of the top .
If you want to build this structure ,
here ,
you start off with the pillars on the side as well as the pillars at the back .
So as the entire structure holds up ,
so that we may have a priority or a sense of knowing what is more important than the
other things ,
so that you have a sequence by which you do a construction of the building in the
same way when you are doing a case litigation you need to know which are the pillars
the foundational structures that will not move and which are the structures that can
move so that you know where to fight now so for example ,
if you what you have is only a sword .
All right .
Um ,
you attack the pillar who is gonna win ?
You have a sword and you attack the pill here .
Who is gonna win ?
The pin will win ,
right ?
Your sword is not enough to defeat the pillar right ?
But with your sword ,
right ?
If the weak point in this room relates to ,
say ,
one of the panels here ,
you just pierce it and this ,
god ,
the lights will go off ,
right ?
So you kind of need to know which are the weak points in your opponent's argument ,
and to do that ,
therefore ,
you need to know which are the strong structures ,
the strong arguments ,
which are the weak arguments ,
which are the weak arguments where if you poke it alright and you pierce it ,
the entire structure will collapse or there will be a failure .
All right .
So ,
for example ,
if i just use a sort of hook ,
the purple panel here ,
and you just think that his professors were crazy ,
right ?
That's all it is .
But if i use my my sword and i pierce the panel such that that is electrical short circuit
,
okay you guys will start running on the correct .
Okay so really ?
Therefore it is to know the weak points in your opponent's argument that's why we
need to know the law well and not just know the law ,
knowing the law ,
as i say ,
i know there's a pillar here the here ,
the panels that ,
but you need to know where the weak points in your opponents are .
You flip it around .
So if you're building a structure ,
therefore ,
you need to know how to defend against your opponent who is going to attack you ,
right ?
So that is where transaction planning comes in .
So in company law ,
although some causes emphasize a lot on the fighting aspects ,
litigation aspects ,
you're going to call aspects a in my courses ,
causes ,
because one ,
one and two ,
i exercise also the transaction planning aspects ,
you're building a structure ,
and hopefully the structure ,
the transaction that you build is solid enough such that when the other party regrets
and once you get up ,
you fall into it ,
you can't get out .
Okay and this ,
therefore ,
is like a game ,
right ?
It's like a game ,
it's like a chess game ,
it's like a tennis game .
You know ,
you know the rules well ,
you have good skills ,
you'll be able to track your opponents and they can't get out of the deal ,
and they need your consent before you get with you ,
for which then you can extract a very nice profit out of it .
However ,
if you easily get out of the door right ,
without being trapped here ,
well ,
they don't need to pay you anything .
Goodbye .
Off they go .
All right ,
so that's -
the two perspectives that i want you to bear in mind as you go into these two causes
on company law .
First is the litigation aspects .
The litigation aspects talks about how you attack your opponent to make sure that
your site's right ,
you get what you want ,
right ,
and if you're playing defense ,
if you switch around and you're on the other side ,
to defend your client ,
to make sure that your client's case right is solid enough in order to prevent the attack
from succeeding so that's at the end point ,
when we are fighting our case right .
But very often ,
what many of you will be doing personal education ,
many of you will be doing transaction planning .
and so your job then is to build a structure that will not collapse .
Okay so that's the important thing to bear in mind ,
so ,
so moving into a company law .
Therefore ,
i'm going to start with the simple ,
which is my style ,
and then we will go levels deeper to see the complexities that are involved .
Now in terms of ,
um ,
in terms of doing business ,
we can have a number of structures .
In today's world .
There are even more than this ,
but these are the three historically a significant ,
um ,
shall we say ,
forms by which you organize a business .
The first one is called the sole proprietorship as you can imagine ,
under the sole proprietorship it is one person .
It's very simple .
You are the boss ,
right ?
You better liability including your home ,
your house ,
your personal savings for your family ,
your retirement income .
Everything goes in to your business ,
right ?
Because you is your personally liable in other words ,
there's no distinction between your personal life finances ,
for example ,
your savings for your sons or daughters ,
education and your business expenses um ,
you've got to do things in order to make that happen .
But without doing anything more than your business liabilities can result in a -
can result in your son's retirement ,
a son's educational fund being sent out for business .
Okay so this is a therefore sole proprietorship it's very cheap .
It's very cheap because there's no much of a formality um ,
you will find that that there is a registration of a business ordinance in hong kong that
applies to all three ,
right ?
Essentially ,
what hong kong wants to do is to make sure that you do have a license and they know
they keep track of the statistics and how many businesses they are .
If you do open a business ,
right ,
the burdens are not heavy at all .
Now then ,
we come into partnership and company .
Now ,
um ,
let's just talk about the partnership first .
So back to my theme ,
from the simple to the complex .
At the very ,
very simple level ,
partnership is basically an agreement .
Partnership is basically an agreement .
Being an agreement means that partnership is contract .
Okay that's your starting point is ,
it is not a complete picture ,
but that's your starting point ,
but it's a very ,
very important starting point ,
because what it means is that if your partnership provides for certain contractual terms
in your partnership ,
that will govern .
Let me say that again ,
because partnership is fundamentally about contracts ,
because partnership is fundamentally about contracts .
And if you write your contract ,
well ,
if you provide for terms in your contract ,
the contract terms will prevail okay so that's your starting point .
Now ,
the learning point from there and what you need to do ,
but you need to then appreciate that .
Oh ,
that means that you ,
as a transaction planner have a role in this ,
because if you plan the partnership terms well ,
you get good protection for your client ,
you get good weapons for your client to hold the other party ransom okay all right .
So there is therefore a very good premium emphasis ,
therefore ,
on planning the contract ,
planning the partnership .
D.
Okay this is your first point ,
a very ,
very important first one .
Now ,
so i said that fundamentally partnership is about contract ,
but it's more than that .
What is that more ?
What is that more ?
So let's just say second step now is this contract plus this contract plus ,
okay now what is this contract plus we're talking about now ?
So partnership is to be distinguished from a simple contractual joint venture .
In a simple contractual joint venture ,
we cooperate on certain things .
So ,
for example ,
we have a mind ,
we put our monies together ,
we extract the minerals from the mine .
You take about forty percent ,
sixty percent .
We go our separate ways .
Okay all right .
We just put our money together for a certain purpose .
Okay that is purely contractual that wouldn't quite involve much partnership now .
So the plus that we see in partnership involves an element of trust ,
confidence .
Okay the plus in partnership involves an element of trust and confidence .
In other words ,
we come to this very significant obligation known as a fiduciary duty .
Is this word familiar to you ?
If i do ,
you can you just not your head if it is only a few of the hits ,
okay now i usually do is fundamentally about trust and confidence .
But it is a very ,
very strong of trusted confidence .
Fiduciary duty means that you owe a duty of loyalty to the beneficiary right ?
So if you have two partners ,
they owe each other a duty of loyalty .
Now what does the duty of ,
i mean ,
the love means that i place you above me .
Duty means i place you above me .
In other words ,
and it works out in various forms .
Can i just see by nodding anybody has done ,
anybody has done .
Trust ,
equity .
You have ,
you should your head .
Okay all right .
So you can't be just staring at me .
Can you just either this way or this way with the horizontal ?
Can i just okay all right .
Okay so ,
um ,
so actually ,
ideally a company law should come after trust equity ,
but i'll give you a very brief introduction into that .
So one .
So if you look ,
if you recall your contract law ,
your starting point is if there's a breach of contract obligations ,
damages right ?
Remember military compensation ?
Yeah .
Okay and if you want specific performance ,
you have to jump ,
jump ,
jump ,
jump ,
jump through a lot of hoops before you can get specific performance ,
okay if you want equitable remedies like injunction not so difficult ,
but you have to jump through a few hoops okay so your primary remedy in contract is
about damages monetary compensation .
Okay now ,
when you move into equity and you involve the duty of loyalty ,
right ,
which we call the fiduciary duty ,
because of this relationship ,
i owe you due to your loyalty and equity now steps in the picture .
Equity says this is a very highly protected category of relationships ,
and because it is a highly protected kind of relationship ,
we are going to do more remedies so it's more than damages if you therefore contract
and make private profits ,
okay there's a breach of the duty of loyalty to your other partners within the business .
They do not only have a right to ask for damages they can ask for this .
This means all your profits have to be surrendered to the business .
Do you follow ?
All right .
So this is a very different kind of remedy as you can see ,
compared to damages because if you recall your remedies of which a contract ,
the focus always is on the plaintiff what if you ,
the plaintiff lost you recall that the focus of the plaintiff in contract law ,
in equity .
It turns it around ,
right ?
We can ask a question .
Why have you ,
the defendant gained your games ?
I will check out everything from me .
And that's how powerful it is and that's why i usually do matter .
Are you following me here ?
Okay so that's why it is contract plus ,
and it's very important contract plus ,
because it's not just contract .
Okay if you forget this aspect of partnership law ,
and then your law partner in the law firm will ask you to thank you very much ,
go somewhere else .
All right .
So this is very significant right now .
Let me then move one level deeper .
Let's just say that this person ,
the ,
the disloyal partner ,
has obtained this unlawful profits because he traded in the same business as the ,
this ,
this partnership ,
and he obtained profits from it .
Okay so what we saw just now was they can sue ,
for which our duty and ask for the gains to be given to the business so far .
Okay just step one .
Now suppose that he was smart enough not to be discovered for a long period of
time ,
and these amounts of money are very large .
Okay so large that he bought a piece of real property with it .
Let's just say it's -
a apartment ,
apartment ,
flat .
Okay in the mid levels and in the -
in the nature of things before the current situation ,
the public prices go up and up and up and up .
After about five years ,
let's just say that the property prices increase into sixty percent .
So if you bought something at fifty million dollars ,
it is now eighteen million dollars .
Question :
can the other partners go after this piece of property ?
There's no more money .
You know it's ,
not property .
And the answer is yes .
The answer is yes ,
because equity ,
equity or common law equity ,
allows for these kinds of unlawful profits to be traced which means we follow the
money into where it's been invested insofar as it is invested into other kinds of assets .
It can be real property ,
apartments ,
it can be learned ,
it can be stocks and shares ,
it can be toys ,
right ,
which increase in value .
Nonetheless ,
you can trace into that and to say that that is ours ,
that's how powerful it is .
Okay now ,
so i hope that in the last few minutes ,
i have impressed upon you how significant this contract class is .
It's not just additional duties is contract that's common law plus equity .
Equity comes with certain duties ,
it comes with certain very ,
very powerful remedies and that's why it is contract plus plus one plus equity .
Okay so for those of you who have not yet done equity ,
this is your introduction to an element of equity and why equity matters .
And it matters a lot .
Okay now ,
at this point ,
can i just pause for a moment and ask whether there are any questions ?
Okay all right .
Let's move on then .
So if partnership is less significant ,
how do we know whether you see ?
Okay how do we know whether a relationship is a partnership or not now ?
So ,
um ,
so this is our first glance at the partnership ordinance okay before we go into the
definition ,
i want you to just go into the legislation .
All right .
Can you go to legislation on your computer and just let me know how many
provisions there are ?
How many sections are there in the partnership ordinance thank you .
Okay now ,
can you then go into the company's ordinance and tell me how many sections that are
in the company's ordinance oh ,
wow .
Okay now that's a lot isn't it ?
Okay we are talking about a factor of more than ten more than ten .
Okay we're looking at effect on twenty plus ,
right ?
Okay that's a lot .
And my newer the set ,
each section in the company's office is longer .
All right .
So what accounts for this ?
All right .
So this is this is intentional i want you to do this .
Okay now one thing which one matter which which allows you to appreciate why
there is a big difference in the length of the partnership ordinance and the length of
the company's ordinance is this :
the partnership ordinance was basically a consolidation of the judgment law in the
nineteenth century .
Let me say that again ,
the partnership ordinance was essentially a consolidation of the judgment law in the
nineteenth century .
Okay what does this mean ?
This means that the case law got very ,
very unwieldy because what it means is that in order to appreciate the law ,
you need to go and find a right case for the rule in question .
So what they did was ,
they said ,
let's make it simpler let's extract the important rules on partnership and place them
into one statue .
Okay so and essentially then you came up with forty over sections and it's not very
thick at all .
So the ,
the partnership law is pretty much summed up ,
not it's ,
not the entirety but the is pretty much summed up in those forty over sections in the
company's now ,
so judge made law .
And you can appreciate by now ,
judge me ,
law typically ,
very often is not mandatory right now .
So what You are mandatory ?
Mandatory means that you must do something or you cannot do something ,
right ?
And you don't do something ,
then you'll be punished um ,
um ,
there are common law crimes ,
as you have learned in your criminal law ,
but by and large ,
right ,
the judges have actually moved away from legislation ,
right ?
And in today's world ,
we just say that judges are have no road legislation ,
right ?
Even in the nineteenth century there was actually true .
So what does this mean ?
What's the implication for that ?
The implication for that is actually this :
that your partnership ordinance is sets up basically your default rules for you .
Okay it's pretty much default rules .
They're not mandatory rules by large .
Some of them may be difficult to get around ,
but they're not men .
You don't find that there's a punishment provision that typically ,
all right ,
there are there default rules .
They therefore supplement your agreement .
If there's a hole in your agreement ,
right ?
You just blank agreement .
You look for orders to help you .
All right ,
to fill in the gap in your agreement .
It helps you to understand your agreement ,
but essentially it is there to ,
to in the background .
Okay now .
And because of that ,
what it means ,
that is back to our earlier theme .
You can always call ,
you can pretty much always contract around it .
Which means this ,
despite what you see in section three ,
one of the partnership ordinance if you state very specifically that parties agree that
we will not be partners with each other ,
all right ,
and we will do not owe duties of loyalty to each other .
In other words ,
we do not owe duties to each other .
The lord accept .
Okay so that's that's that .
Back to the theme earlier on about contract plus .
Right .
The last part can very often be taken away .
Okay now .
So with that in mind ,
then let's look at the definition of partnership in ,
in ,
second ,
three ,
one .
Now what it says here is partnership is a relation which subsists between parties
carrying on the business in common with a view to a profit .
A number of comments about this .
First ,
note that there are no formalities involved .
There are no formalities involved .
You do not need to register in order to be considered a partnership .
You don't need to file any documents with the government in order to be considered a
partnership .
Okay so no formalities involved .
Number two ,
the definition is wholly substance in nature ,
substantial in nature .
In other words ,
the question is whether there is a relationship between persons and persons can be
natural persons like you and i ,
with flesh and blood ,
or can be legal persons and companies .
Okay now .
So persons .
Now ,
this is where bites are carrying on a business in common with a view to profit .
Yeah .
So the key words ,
the key phrases here are business in common with a view to profit .
In other words ,
partnerships basically apply to profit seeking relationships .
All right ,
profit seeking relationships .
More than that ,
it must be a business in common ,
right ?
So the most important phrase in this definition is a business in common .
What is that business in common right now ?
So what it does mean is that if we're talking about ,
say ,
a chess club ,
right ,
a chess club right ,
or tennis club ,
you will not think of at all ,
because these are social clubs ,
right ,
which pursue a common interest ,
but the common interest does not amount to a ,
due to a profit .
Okay so ,
um ,
when you think about these kind of social organizations that do not involve profit ,
then it will you will not be thinking about partnership .
Okay so the key idea here is what is a business in common ?
Okay we're gonna explore that more later on ,
but let me now go into ,
um ,
why a punishment matters a little bit more with a by revising the contract plus issue .
Now just as in a just as when i said that in the company law ,
we have one semester devoted to the internal dimension ,
there is and one semester devoted essentially to an external dimension in partnership
to we can analyze it in terms of internal dimension and the external dimension .
Okay both dimensions are significant and important in both planning the partnership
as well as in litigation so both dimensions are important .
Now ,
we have both spoken about the internal dimension a little earlier on .
So if you look at the first bunch of text in this ,
in this a slide ,
you'll see that the top bunch of text here involves the internal dimension and you see
under the fourth bullet point something that is familiar ,
something that i just talked about .
The duty .
Okay so bear in mind this fiduciary duty in our context and there's a hong kong
context .
I mean the duty of loyalty .
It carries very special remedies let me pause here to say that the duty of loyalty here ,
right is very different in a comparative point of view from what you see in america .
Let me say that again .
If you read ,
if you read the internet ,
a special american website ,
if you read american journals ,
this word fiduciary duty keeps being brought up time and again .
Okay now at this point in time ,
you need to understand that the same word can mean different things in different
jurisdictions the same word can mean different things in different jurisdictions okay
so when you see the word fiduciary or if i do my duty ,
you need to then look and see what is the context ?
What is this website ?
Who is the american website ?
Or is it australian or british website ?
Okay now what's the difference between the australian understanding of the uk
understanding of fiduciary and the american understanding of -
i will put it simply ,
maybe a bit too simply ,
but it will help you nonetheless .
Now remember what i said just now in our context in hong kong ,
in the uk context ,
right ?
We talk about the fiduciary it is the duty of loyalty ,
this kind of relationship .
I owe you a loyalty .
I now am subordinate to you .
My interests are below yours .
Right ?
In other words ,
if i transact um ,
um ,
that ,
that might put our ,
my neutrality at risk .
I need to tell you first .
Now ,
again ,
this is different from common law contracts because common law contracts no duty to
tell anything ,
right ?
If i do your duty in the commonwealth ,
in the ,
in the uk ,
hong kong context ,
you have the duty to disclose right ?
In the prophets you disclose if you don't disclose they can then sue you to ask for the
gifts to be given to them .
Now ,
so the key idea is loyalty .
Switch contacts ,
move across the pacific ocean into the us context .
In the us context ,
when we talk about duty ,
it basically means :
i owe you a duty .
I should do something for you ,
okay i should do something for you .
That's what it means .
Okay does it attract the kind of drastic remedies that we have been talking about ?
Not necessarily necessary .
Okay so ,
in other words ,
you can throw around that phrase in the us for duty .
You can use that phrase very loosely because it doesn't really matter .
Okay your remedies will not be very different from contract .
That's why you can use it very loosely you almost like a tall right .
For example ,
in ,
in ,
in ,
in company law ,
they say a majority shareholder has a fiduciary duty to the minority shareholder in
america ,
for you never say that .
Never say that .
I'll mark you down for that .
Okay we do have fiduciary duties or majority against minority in our context .
All right .
They might owe some kind of duty ,
but not usually .
Okay so you need to therefore be very precise in your understanding of certain of
these terms ,
because they carry implications .
So because i've been in ,
in ,
in ,
in the law for a number of years and a good number of years ,
i-
i get a bit impatient when people don't use terms very ,
very loosely i can understand it .
I'm fucking american because they don't understand my context .
Alright so i then switch my mind immediately in the american context ,
because i didn't do my phd after all .
So i know what they're thinking about .
Okay but if you're talking to a hong kong person ,
a special business person ,
and they threw around duty ,
duty ,
right ,
i didn't stop and ask him what i mean .
I kind of know what i'm talking about ,
so i can keep quiet .
But sometimes if they mix it all up ,
right ,
then i would say ,
oh ,
well ,
you need to understand that there are different users ,
but you should do what you're talking about ,
right ?
So this is i'd say that very nicely of course .
Right .
So this is something that you cannot be interesting about .
Okay let me warn you ,
since i've warned you about it ,
i will make sure that there will be penalties for you if you forget that in your ,
in your paper .
Now let's move on .
Right ?
So the fourth bullet point ,
something that you ,
you have ,
you have ,
uh ,
i've talked about already .
Okay now .
So all of these are right .
All these other bullet points that you see in the first bunch of text up here ,
you find that they are essentially therefore a part and parcel of what you expect in a ,
in a partnership relationship .
So ,
for example ,
if you are a partner ,
the default ,
the starting point is that you are a partner together with the others ,
you are entitled to manage the business .
Makes sense .
Makes sense .
Okay we're partners ,
after all ,
so we can decide the business together ,
okay um ,
we are also entitled to share in the profits and losses equally .
So it is by -
it is essentially by person .
Become the person .
If there are five partners ,
we split the profits five ways .
If their losses ,
we split the losses five ways .
Okay stopping point .
Okay so let's just discuss these two points .
Can i change this ?
Of course you can .
We talked about contract plus when you want to change it .
Now suppose ,
now that you have a law firm and you know ,
some law firms ,
international law firms ,
have got all my partners .
I'm not kidding one hundred partners .
Can you imagine ?
One hundred partners and each partner saying i can manage the business .
It is not workable can you see that ?
Right ?
Because then you do not know what one is doing .
We do not know what hundred eighty seven is doing ,
and they are doing different things .
So can you imagine ?
We need a computer ,
one hundred eighty seven orders ,
a computer ,
twenty forty six men and others ,
and another two computers for the office .
And gosh now we have access computers .
Okay so essentially ,
therefore ,
at some point in time ,
all right .
And if you want to ,
what you can do is you can then change the rules so that you have a management
committee .
In other words ,
in a partnership agreement ,
you agree that even though you are a partner ,
you will delegate the management of the business to the management committee ,
and that's why getting into the central committee ,
getting into the management committee ,
becomes a big thing .
You follow all right ,
and you then therefore vote ,
then vote those that you think are responsible into the management committee .
Typically ,
you would say that this committee should not exceed twelve .
Even twelve is very large .
Typically you want something like below ten .
Okay all right .
Um ,
so that makes sense ,
right ?
From a management perspective .
Okay so you can change that ,
right ?
You can change that by your partnership .
D.
You change a partnership and so change the default rule ,
which is every partner is expected to manage into a committee managing the business
on behalf of the hundred and fifty seven partners .
Okay so that's one scenario .
Now ,
second bullet point ,
share in profits and losses .
Starting point ,
we count each person equally .
Okay that's ,
that's ,
that's fair .
But you see ,
sometimes you don't want that .
Sometimes you talk about that partner a has contributed the land ,
which is worth eighty million hong kong dollars ,
towards the business .
Partner b comes in and he is the rainmaker rainmaker means you can get clients ,
right ?
But you haven't contributed much towards this .
Okay um ,
so they might say that ,
well ,
i more capital towards this business .
You're contributing your talent ?
Yes ,
but it is slowly being effectuated slowly realizing it .
But at the starting point ,
we cannot be equal .
All right ,
so you might then agree ,
therefore ,
for the profits to be a split nine to one eight two two seven to three seventy three to
twenty seven ,
whatever proportion you want and if you provide for that in your partnership
agreement ,
it will prevail okay all right .
So we are again going back to the theme .
Partnership is contract plus right ?
Your class can be taken away .
Your rules in the partnership ordinance can be contracted around .
And your partnership rules ,
therefore ,
are there as your background rules ,
which you apply if you do not write contract around them .
And that's why that accounts for many things in the litigation very often ,
the litigation between partners is either about property ,
all it's about the terms of the partnership agreement ,
in its partnership agreement ,
we're back into the terrain of contract law .
Okay if it's about property ,
we have got more to say about this after the break .
All right ,
so this is a good point in time for us to take a ten minute break .
We're kind of at ten ,
forty seven right now .
Let's come back at ten ,
fifty seven .
Okay you just sound like a whole shorty i don't know .
I'm enjoying it .
Yeah ,
you see the last one .
You see that's yeah ,
you want to incorporate come on ,
boy .
It sounds four twenty four one .
This time for her will help me .
Oh ,
my gosh i love you .
Put on the car .
What does it you see as a girl ?
I see it .
Yeah ,
yeah ,
yeah .
I don't have a .
I had to call me short video as we don't need no one .
No ,
i told you not .
No ,
that was i'm telling you that .
Please play santa .
I'll call the university college .
Hold on ,
right ?
No ,
no ,
it isn't yet ,
bro .
Dude the kids .
Sorry .
That nigga wait ,
what ?
Oh ,
muhammad is a ?
Who am i ?
Don't send you .
Can you fuck .