Assignment 1 2023
ENTREPRENEURIAL LAW
MRL2601
Semester 2
Department of Mercantile Law
QUESTION 1:
In the given scenario, where Susan and Jane decide to dissolve their partnership by agreement and
the partnership agreement is silent regarding the goodwill, Susan may have a remedy to claim her
part of the goodwill.
Goodwill refers to the favorable reputation and relationships that a business entity has established
with its customers or clients, which results in an increased market value. In a partnership, the
goodwill is considered a partnership asset, and partners have an equitable interest in it.
In this case, since the partnership agreement does not explicitly mention the goodwill, the principles
of the Partnership Act 68 of 1892, specifically section 35, will apply. Section 35 states that unless
otherwise agreed, the partners are entitled to share equally in the profits and surplus of the
partnership, and they must contribute equally to the losses. This provision implies that the assets of
the partnership, including the goodwill, are to be divided equally between the partners upon
dissolution.
Therefore, Susan may argue that she is entitled to her share of the goodwill and can claim her
portion of its value. However, it will be necessary to establish the value of the goodwill and
determine the appropriate proportion that Susan is entitled to. Factors such as the contribution of
ENTREPRENEURIAL LAW
MRL2601
Semester 2
Department of Mercantile Law
QUESTION 1:
In the given scenario, where Susan and Jane decide to dissolve their partnership by agreement and
the partnership agreement is silent regarding the goodwill, Susan may have a remedy to claim her
part of the goodwill.
Goodwill refers to the favorable reputation and relationships that a business entity has established
with its customers or clients, which results in an increased market value. In a partnership, the
goodwill is considered a partnership asset, and partners have an equitable interest in it.
In this case, since the partnership agreement does not explicitly mention the goodwill, the principles
of the Partnership Act 68 of 1892, specifically section 35, will apply. Section 35 states that unless
otherwise agreed, the partners are entitled to share equally in the profits and surplus of the
partnership, and they must contribute equally to the losses. This provision implies that the assets of
the partnership, including the goodwill, are to be divided equally between the partners upon
dissolution.
Therefore, Susan may argue that she is entitled to her share of the goodwill and can claim her
portion of its value. However, it will be necessary to establish the value of the goodwill and
determine the appropriate proportion that Susan is entitled to. Factors such as the contribution of
