Lawyers get paid by the billable hour. If they don't see a problem then they have nothing to bill you for. It is likely that one of these lawyers is trying to milk one of you. How about, you and your partner find a 3rd attorney to draft the document. If you cant agree on a lawyer, you might not survive as partners.
Lawyers get paid by the billable hour. If they don't see a problem then they have nothing to bill you for. It is likely that one of these lawyers is trying to milk one of you. How about, you and your partner find a 3rd attorney to draft the document. If you cant agree on a lawyer, you might not survive as partners.
It sounds like the drafting attorney was either given the wrong information, or has no idea what they are doing.
An LLC needs an "operating agreement" not a "partnership agreement".
An LLC's operating agreement should not be written in the context of a Limited Partnership, as these are two different legal entities governed by state law.
Your attorney sounds the most correct based on limited information.
Out of curiosity, what does LA do differently on property transactions? I know you have a different property description, but does that affect a standard sale on commercial property?
Had one guy ask me about an apt in Metarie once and outside of not being close enough to French Quarter, I didn't know bupkus.
"I'm mostly uncomfortable that your partner has one attorney, and you have another."
See it a lot here, especially if the partners are linked more by business (I wanna make a profit) interests vs. being grade school buddies and I do understand that.
Not so much a trust issue as getting things defined up front.
Thank you for the confirmation. I stopped reading the agreement after 3 sections as I didn’t think it’s applicable to us. Makes sense now it’s a template.
Property transactions aren't substantially different in Louisiana than anywhere else. Unless you're getting into pretty specific areas, or using unique tools like bond-for-deeds, it's the same game. You'll want to watch out for succession issues, which can be pretty different.
@Alice Huang I quote a flat rate for doing the operating agreement of an LLC so that's not a red flag. If you are creating an LLC you don't necessarily need a partnership agreement because the operating agreement of the LLC acts as a partnership agreement. Sounds like you have a pissing match between attorneys because they want to get your future business and aren't happy they are only getting a piece.
One attorney should present the operating agreement and if the other isn't happy with it, they can make recommended changes or corrections. This might run up a bill for you though.
@Alice Huang I agree with @Bob Floss II. In my practice, I quote flat fees for just about everything so that shouldn't be a red flag. As a tax attorney, I always ask my clients what's the purpose your trying to achieve. If it's just a simple operating agreement for you LLC, my operating agreements hardly ever mention partnerships as the differences between the two can be vast, and I prefer to keep the two completely separate to avoid confusion, especially for the IRS. I have practices in PA and GA, and I have never seen a partnership agreement used for your situation. I do know attorneys who pull these agreements off the internet or a business law firm practice guide handbook without knowing the implications. My personal suggestions would be to have a discussion with your partner to learn what objectives need to be achieved with the agreement and then have that discussion with an independent attorney who specializes in business law. The truth is you really should try and get this right as the headaches will only get bigger if it's not. Good Luck!
@Alice Huang I agree with @Bob Floss II. In my practice, I quote flat fees for just about everything so that shouldn't be a red flag. As a tax attorney, I always ask my clients what's the purpose your trying to achieve. If it's just a simple operating agreement for you LLC, my operating agreements hardly ever mention partnerships as the differences between the two can be vast, and I prefer to keep the two completely separate to avoid confusion, especially for the IRS. I have practices in PA and GA, and I have never seen a partnership agreement used for your situation. I do know attorneys who pull these agreements off the internet or a business law firm practice guide handbook without knowing the implications. My personal suggestions would be to have a discussion with your partner to learn what objectives need to be achieved with the agreement and then have that discussion with an independent attorney who specializes in business law. The truth is you really should try and get this right as the headaches will only get bigger if it's not. Good Luck!
Thank you Chase.
The LLC attorney just wrote us (word for word): "As long as other factors were also present - you both share profits, both participate in control, agree to share losses and both contribute money to the operation - then under Texas law you will be considered partners. We can omit the specific operation language. You just need to be have the elements necessary to claim a partnership for tax purposes."
@Alice Huang I can not comment on specific Texas law as it relates to the formation of partnerships. However, I was able to find an article from a law firm in Houston that does a very nice job walking through Texas partnership structure as it relates to real estate. You can find it here: https://lonestarlandlaw.com/partnerships-and-joint-ventures/
The conflict of interest thing is dumb to me. Shouldn't the 50/50 LLC equally benefit both sides? So what's good for the LLC is good for you? Is it likely the LLC will do something not in the member's best interest?
Property transactions aren't substantially different in Louisiana than anywhere else. Unless you're getting into pretty specific areas, or using unique tools like bond-for-deeds, it's the same game. You'll want to watch out for succession issues, which can be pretty different.
I get asked about LA as an investment market (mostly by guys from there originally), so now I have someone to refer them to.