Documenting your practice arrangements

Are you currently operating as a Partnership at Will, with no agreed documentation to govern the operation of your partnership or the ownership of your practice premises?

First published in Practice Management in March 2022. 

If you are, or any documentation that you do have in place is now out of date, then you are leaving yourself open to risks, and an increased likelihood of disputes. Without a partnership deed, partnerships are governed by the Partnership Act 1890. This is not only quite an outdated piece of legislation but it also is not tailored to your specialist area; that of running a GP practice partnership.

A Partnership at Will can, therefore, provide a very unstable environment, with no prescribed notice periods for retirement/ dissolution, no restrictive covenants to protect practice goodwill, no dispute resolution processes in the event of disagreements, no agreed absence periods… (the list goes on).

As well as the practical benefits of having partnership documentation, it is also helpful to demonstrate to NHS England and the Care Quality Commission, that the practice has a clear governance structure in place, and for CQC purposes, is well led. Having particular provisions in your documentation to provide for performance management may also be a helpful tool to monitor performance and training requirements.

It isn’t just the operational mechanisms that should be documented for your partnership, but also the practice premises ownership – that includes whether the property is owned or leased by the partners and if it is intended to be partnership property. Some of the key things to think about in your partnership documentation, are as follows:

  • What are the partnership assets and how are they owned?
  • What income belongs to the partnership and are partners entitled to retain any income personally?
  • How are profits divided between the partners?
  • How are roles outside the partnership (e.g. the clinical director of the PCN) managed?
  • How are decisions made and are there different levels of decisions that require different levels of consent?
  • What types of leave are partners entitled to and who pays for locum costs during such periods of absence?
  • How does a partner retire? Do the partners have any rights to expel or compulsory retire a partner and, if so, in what circumstances and how?
  • Do you have protections in place to avoid a last man standing scenario?
  • How is the property owned and who by?
  • If there are more than four partners, the interest in the property may be held ‘on trust’ (as only four partners can be named on the legal title)
  • What expenses (whether property related or otherwise) are borne by the partnership?
  • What happens when a partner retires, including any post-retirement restrictions that may be imposed on them? How is any interest in the practice premises dealt with?

Ensure that you have comprehensive and robust partnership documentation in place so that when circumstances occur, there is an agreed path to follow; and keep that documentation up to date.