Partnership deed in case of death of partner

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Jyothi (Querist)
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19 June 2019 In a firm there were 4 partners out of which one partner has died. Now remaining partners want to continue business in partnership and want to add a new partner . Plz provide me format/ draft of partnership deed in this situation specially in case of death of a partner.

Thanking you

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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09 July 2024 Certainly! Here's a draft outline of a partnership deed clause specifically addressing the situation where one partner has passed away and the remaining partners wish to continue the business by adding a new partner:

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**Partnership Deed**

**Clause: Death of a Partner and Addition of New Partner**

**1. Death of a Partner:**
- The partnership shall continue notwithstanding the death of Partner [Name of Deceased Partner], who passed away on [Date of Death].
- The legal representative or executor of the deceased partner's estate shall cooperate with the remaining partners in settling the affairs of the deceased partner in accordance with this deed.

**2. Addition of New Partner:**
- The remaining partners, [Names of Remaining Partners], hereby agree to admit [Name of New Partner], residing at [Address of New Partner], as a partner in the firm effective from [Date of Admission].
- The new partner shall be entitled to [Specify Percentage] of the profits and shall bear [Specify Percentage] of the losses of the partnership.
- The capital contribution of the new partner shall be [Specify Amount or Method of Determination].

**3. Rights and Obligations of New Partner:**
- The new partner shall have the same rights and obligations as the existing partners under this partnership deed.
- The new partner shall participate in the management and decision-making of the partnership business in accordance with the terms and conditions specified herein.

**4. Valuation of Deceased Partner's Interest:**
- The value of the deceased partner's interest in the partnership shall be determined as per the valuation method agreed upon by the remaining partners and the legal representative of the deceased partner's estate.
- The purchase price for the deceased partner's interest shall be paid to the legal representative or executor of the deceased partner's estate in accordance with the terms specified in this deed.

**5. Continuation of Partnership:**
- The admission of the new partner shall not affect the continuity of the partnership business, which shall continue to operate under the name of [Partnership Name].
- The existing business operations, assets, and liabilities of the partnership shall be transferred to the continuing partners and the new partner as per the terms of this deed.

**Amendment to Partnership Deed:**
- This partnership deed shall be amended to reflect the admission of the new partner and the settlement of the deceased partner's interest.
- Any amendments to this partnership deed shall be executed in writing and signed by all partners, including the new partner and the legal representative of the deceased partner's estate.

**IN WITNESS WHEREOF**, the partners have executed this clause related to the death of a partner and addition of a new partner on the date first above written.

**[Signatures of Remaining Partners]**

**[Signature of New Partner]**

**[Signature of Legal Representative of Deceased Partner's Estate]**

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This draft clause outlines the basic provisions regarding the death of a partner and the addition of a new partner in a partnership agreement. It's important to customize this clause according to your specific partnership agreement and seek legal advice to ensure compliance with local laws and regulations.

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