MRL2601 ASSIGNMENT 1 2026
DUE 11 AUGUST 2026
QUESTION 1
1.1 Marcus's Remedy Regarding Goodwill of the Partnership
In terms of the common law governing partnerships, Marcus and Cobus, partners
practising as quantity surveyors, dissolved their partnership by mutual agreement. The
partnership agreement is silent on the treatment of goodwill. Cobus continued practising
and de facto appropriated the partnership's client base (valued at R1 million) for his sole
benefit. Marcus seeks to claim his share of the goodwill. The central question is whether
Marcus has a legal remedy under South African common law and, if so, what that
remedy entails.
The Nature of Goodwill in a Partnership
Under the common law principles of partnership, goodwill is an intangible asset
representing the reputation, customer connections, and future earning potential of a
business. In a partnership, goodwill is an asset of the partnership and is held by the
partners jointly as co‑owners.¹ The client base of a professional practice is an integral
component of its goodwill.² The partnership agreement being silent on the treatment of
goodwill does not extinguish Marcus’s rights, because the default common law rules
govern the relationship between partners in the absence of contrary agreement.³
¹ Delport, P New Entrepreneurial Law 2nd ed (LexisNexis 2020) 9 (discussing partnership assets as
co-owned property).
² Robson v Theron 1978 (1) SA 841 (A) 846D–E.
³ Delport (n 1) 106–107 (naturalia of partnership agreements apply in absence of contrary agreement).
, The Applicable Remedy: Actio Communi Dividundo
According to the authoritative decision in Robson v Theron 1978 (1) SA 841 (A), the
appropriate remedy available to Marcus is the actio communi dividundo – the action for
the division of things held in co‑ownership. This remedy was authoritatively confirmed
by the Appellate Division, which held that when a partnership is dissolved and one
partner continues to use the goodwill, the other partner is entitled to payment of his
share of the goodwill.⁴ The court stated:
“Where two partners dissolve a partnership by agreement and one partner de facto
retains the goodwill of the partnership for his own use and benefit, the retiring partner is
entitled under the common law, by virtue of either the actio pro socio or the utilis actio
communi dividundo, to payment of his half share of the goodwill from the continuing
partner.”⁵
The actio communi dividundo is particularly apt because goodwill is an intangible asset
that cannot be physically divided or auctioned. The court, therefore, will place a
valuation on the goodwill as at the date of dissolution and order payment of the
appropriate share to the retiring partner.⁶
⁴ Robson v Theron 1978 (1) SA 841 (A) 848A–C.
⁵ Robson v Theron 1978 (1) SA 841 (A) 847H.
⁶ Robson v Theron 1978 (1) SA 841 (A) 849B–C.
DUE 11 AUGUST 2026
QUESTION 1
1.1 Marcus's Remedy Regarding Goodwill of the Partnership
In terms of the common law governing partnerships, Marcus and Cobus, partners
practising as quantity surveyors, dissolved their partnership by mutual agreement. The
partnership agreement is silent on the treatment of goodwill. Cobus continued practising
and de facto appropriated the partnership's client base (valued at R1 million) for his sole
benefit. Marcus seeks to claim his share of the goodwill. The central question is whether
Marcus has a legal remedy under South African common law and, if so, what that
remedy entails.
The Nature of Goodwill in a Partnership
Under the common law principles of partnership, goodwill is an intangible asset
representing the reputation, customer connections, and future earning potential of a
business. In a partnership, goodwill is an asset of the partnership and is held by the
partners jointly as co‑owners.¹ The client base of a professional practice is an integral
component of its goodwill.² The partnership agreement being silent on the treatment of
goodwill does not extinguish Marcus’s rights, because the default common law rules
govern the relationship between partners in the absence of contrary agreement.³
¹ Delport, P New Entrepreneurial Law 2nd ed (LexisNexis 2020) 9 (discussing partnership assets as
co-owned property).
² Robson v Theron 1978 (1) SA 841 (A) 846D–E.
³ Delport (n 1) 106–107 (naturalia of partnership agreements apply in absence of contrary agreement).
, The Applicable Remedy: Actio Communi Dividundo
According to the authoritative decision in Robson v Theron 1978 (1) SA 841 (A), the
appropriate remedy available to Marcus is the actio communi dividundo – the action for
the division of things held in co‑ownership. This remedy was authoritatively confirmed
by the Appellate Division, which held that when a partnership is dissolved and one
partner continues to use the goodwill, the other partner is entitled to payment of his
share of the goodwill.⁴ The court stated:
“Where two partners dissolve a partnership by agreement and one partner de facto
retains the goodwill of the partnership for his own use and benefit, the retiring partner is
entitled under the common law, by virtue of either the actio pro socio or the utilis actio
communi dividundo, to payment of his half share of the goodwill from the continuing
partner.”⁵
The actio communi dividundo is particularly apt because goodwill is an intangible asset
that cannot be physically divided or auctioned. The court, therefore, will place a
valuation on the goodwill as at the date of dissolution and order payment of the
appropriate share to the retiring partner.⁶
⁴ Robson v Theron 1978 (1) SA 841 (A) 848A–C.
⁵ Robson v Theron 1978 (1) SA 841 (A) 847H.
⁶ Robson v Theron 1978 (1) SA 841 (A) 849B–C.
