In a recent discussion on the TFSA Locals Only forum, one of the posters suggested that I create a thread on partnerships that new business-people can use as a reference.
This is very brief, so feel free to add anything as you see fit.
I'll start with the obvious points;
Decide who's in control of the bank account. Ideally, each transaction should be approved by all partners before the transaction can take place and all partners should receive a monthly copy of the bank statements. As Blurock put it, if you don't have access to the bank account or statements, you're not a partner, you're an employee. Dave recommended a simple form with a place to fill a description of each payment, the amount, and signatures from all partners.
Also, categorise your expenses and decide what gets paid by the company and what doesn't.
Finally, determine how you'll decide how much money stays in the business and how much is paid out to stakeholders.
Decide who does what. It's practically impossible to define everything down do the smallest detail, but go into as much detail as you possibly can. Don't make any assumptions.
Decide who can buy and sell shares. Decide how you'll calculate the net value of the company. Set up a buy and sell agreement to determine what should happen when a partner dies or leaves the company; how assets will be divided, whether a partner's share needs to be bought out by the other partners, etc. If it's a brand new company, decide how much capital each partner will invest and what their share of the company will be.
Keep your partnership and your personal life separate. If you're going through a tough stretch, that is not your partner's problem. If you can't pay your bills, don't assume that you can pay yourself in advance without approval from all of the partners in the business. Most importantly, make sure that you have everything in writing and signed by all partners. Get a lawyer to draw up an association agreement for your business.
P.S. Before entering a partnership, ask yourself whether you won't be able to get by on your own. If you absolutely need to work with someone else, sub-contract some work to them, or work together on an informal basis for a while to start with. Make sure that you'll be able to work with them - don't enter a partnership 'blind', so to speak.