What are we owed after our senior partner was suspended and we took on his work
I, along with my practice manager wife, joined a single-handed GMS practitioner as partners on 1 August 2007. Our understanding was that the doctor (senior partner) would have 70% profits, I would have 20% profits and my wife would have 10% profits as our working arrangements. We did not sign the contract.
On 10 October 2007 the senior partner was suspended by the PCT. The PCT asked us to run the practice and had given the practice a weekly Locum payment in addition to all other GMS payments payable to the practice at that time. The PCT banned the senior partner taking any part in running practice. He was even banned visiting practice premises. The practice employed different locums on regular basis while we were doing a lot more work than anticipated throughout his absence.
The partner remained suspended until 4 June 2008 when he decided to resign from the practice after relinquishing his GMC registration.
We did not take agreed profits by withdrawing funds from the bank regularly during our partnership. The accountant prepared the accounts and, in the absence of written partnership agreement, divided the profits equally between the partners. Can you please tell us:
- Who should get the seniority payment, senior partner or practice? We did not inform the PCT in writing about how seniority payment should be distributed at the time of forming partnership. Is it correct that the payment belong to practice as we have not informed PCT that it should be paid to senior partner?
- Who should get the locum payment by the PCT - senior partner or practice.
- According to practice accounts, the senior partner owes the practice more than £20,000. The balance in the bank account is £14,000 and is frozen because the senior partner would not sign the cheques. He is insisting that the profits should be split as per our verbal agreement.
- Our argument is that as he did not contribute anything as a partner during most of the partnership period and we had to do a lot of more work than agreed, the split of profit share – a third to each partner - is fair and reasonable.
- Is he legally right to ask for his 70% share from the profits under these circumstances? Because he owes a large sum of money to the practice, do I need to go to court for the decision? Is a verbal agreement legally binding under the circumstances the partnership functioned? As the matter is not moving forward and we have to submit the accounts to Inland Revenue, What are my options?
Andrew Lockhart-Mirams, partner at Lockharts Solicitors