Saturday 8 March 2008

England and Wales: Partnerships: a separate entity for the purposes of criminal liability?

Under English law, partnerships do not have a separate legal personality. This raises many interesting academic and practical questions, one of which the English and Scottish Law Commissions referred to in their 2003 report on the law of partnership (para. 4.43):

"Whether a partnership governed by English law can commit a criminal offence is rather obscure. There are some judicial dicta which indicate that it cannot. On the other hand, our researches have revealed some old statutes which show or appear to show an intention or assumption that a partnership can commit an offence under the statutes in question. The courts have not explored the matter in recent years and we are not aware of any modern prosecutions of a partnership in England and Wales".

Against this background a recent Court of Appeal decision is of particular interest. One of the questions considered in W Stevenson & Sons (A Partnership) and Anor v R [2008] EWCA Crim 273, The Times Law Reports, March 5, 2008, was whether it was possible for legislation to render a partnership criminally liable as a separate entity from the individual partners. Phillips LCJ stated (para. [30]):

"In as much as business activities are conducted in the name of a partnership and the partnership has identifiable assets that are distinct from the personal assets of each partner there is no reason why a partnership should not be treated for the purposes of the criminal law as a separate entity from the partners who are members of it".

The Law Commissions recommended that "except so far as is provided by or under any enactment, whether expressly or by necessary implication, a partnership should not be capable of committing an offence" (para. 4.47). The Government declined, however, to implement the Commissions' recommendations concerning general partnership law (see the ministerial statement).

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