No, provided that the LLP’s original charter (its articles of organization) permits it and all of the current partners are onboard.
A limited liability partnership (LLP) is a business formed to protect the individual partners from excessive financial liability. This differs from a limited liability corporation (LLC) in that no separate legal person (a corporation) is set up. Additionally, the focus remains on the individual partners.
The first step would be to examine the LLP’s articles of organization to ensure there is a clause that permits the addition of a new partner. LLP articles of organization already have stipulations about when someone ceases to be a partner: by voluntary withdrawal from the partnership, by death, by mental incapacity, or by declaration or certification of bankruptcy.
Normally, all partners must agree to admit a new partner to the LLP, unless the articles of organization give that authority to one, leading partner. For a rapidly expanding business, or one that could expand further, an LLP might not be the best form of organization, as it requires extensive coordination between individuals, as opposed to the “united front” presented to the world as a corporation.
If you have questions about your existing LLP or one you plan to form, call our office today. Our experienced business law attorneys will review you and your business’s individual needs to suggest the best legal course of action.