Removing a partner is rarely straightforward under Singapore law. Unlike companies, where shareholders may remove directors through statutory resolutions, partnerships are built on mutual trust and contractual consensus. As a result, the law provides strong protections against involuntary expulsion.
In practice, many partnership disputes arise because partners assume that a majority vote is sufficient. However, Singapore’s statutory framework makes it clear that a partner cannot be removed unless the partnership agreement expressly allows it. Where such clauses are absent, the remaining partners often face costly disputes, court proceedings, or forced dissolution.
This article explains how partner removal works in Singapore across General Partnerships, Limited Liability Partnerships (LLPs), and Limited Partnerships (LPs), supported by statutory provisions and key case law that continue to guide the courts.
General Partnerships: Strong Protection Against Expulsion
The Statutory Rule Under the Partnership Act 1890
General partnerships in Singapore are governed by the Partnership Act 1890. The default position is unequivocal: a partner cannot be expelled by majority decision unless the partnership agreement clearly confers that power.
Section 25 of the Act states that no majority of partners may expel a partner unless an express agreement exists. This provision reflects the principle that partnership is fundamentally a relationship of mutual confidence.
Case Law: Majority Power Is Not Implied
In Blisset v Daniel (1853) 10 Hare 493, the court held that expulsion clauses must be exercised in good faith and strictly in accordance with the partnership agreement. Although this is an English authority, it remains persuasive in Singapore and is frequently cited in partnership disputes.
Similarly, in Green v Howell [1910] 1 Ch 495, the court emphasised that even where an expulsion clause exists, it cannot be exercised oppressively or for ulterior motives.
The takeaway for Singapore partnerships is clear: even an express clause does not give unfettered power.
Court-Ordered Dissolution as an Alternative
When Expulsion Is Not Available
If no expulsion clause exists, the remaining partners may apply to court for dissolution under Section 35 of the Partnership Act 1890. This route is often used where a partner’s conduct makes continuation untenable.
Grounds for dissolution include:
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Persistent breach of the partnership agreement
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Conduct prejudicial to the business
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Permanent incapacity
Case Law: Conduct Prejudicial to the Business
In Snowden v Snowden [1979] 1 WLR 925, the court confirmed that misconduct justifying dissolution must be serious enough to undermine the business relationship. Minor disagreements or commercial misjudgements are insufficient. Singapore courts adopt a similar approach, focusing on whether the relationship of trust has irretrievably broken down.
Partnerships at Will: Exit by Notice
Where a partnership has no fixed term, it is deemed a partnership at will. In such cases, any partner may dissolve the partnership by giving notice under Sections 26 and 32 of the Act. While this does not remove a specific partner, it often becomes a tactical mechanism to force negotiation, buy-outs, or business restructuring.
However, courts have cautioned against abusive use of dissolution rights. In Moss v Elphick [1910] 1 KB 846, the court held that notice must be genuine and not part of a scheme to appropriate partnership assets unfairly.
Limited Liability Partnerships (LLPs): Contract Takes Priority
Default Position Under the LLP Act 2005
LLPs are governed by the Limited Liability Partnerships Act 2005. Although LLPs provide separate legal personality, partner relations remain largely contractual. Under the First Schedule, Paragraph 11, a majority of partners cannot expel another partner unless expressly permitted by the LLP agreement. This default rule frequently surprises LLP partners who assume that corporate-style governance applies.
Case Law: LLP Agreements Are Paramount
In Turf Club Auto Emporium Pte Ltd v Yeo Boong Hua [2018] SGHC 126, the Singapore High Court reiterated that courts will give primacy to the contractual terms governing business relationships, including exit mechanisms. For LLPs, this reinforces the importance of carefully drafted expulsion and valuation clauses.
Bankruptcy, Death, and LLP Partner Status
Under Sections 15 and 16 of the LLP Act:
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Death or dissolution results in automatic cessation
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Bankruptcy does not automatically remove a partner
Instead, the Official Assignee may receive distributions but is prohibited from participating in management. This statutory balance was designed to protect business continuity while safeguarding creditors’ rights.
Limited Partnerships: Special Protection for Limited Partners
Interaction Between the LP Act and Partnership Act
Limited Partnerships are governed by the Limited Partnerships Act 2008, read together with the Partnership Act 1890. Where the LP Act is silent, general partnership principles apply. As a result, Section 25 of the Partnership Act continues to govern expulsion.
Restrictions on Dissolution Rights
Section 8 of the LP Act significantly modifies general partnership rules. A limited partner:
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Cannot dissolve the partnership by notice
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Does not trigger dissolution upon death or bankruptcy
This reflects the passive investment role of limited partners and protects the commercial stability of LP structures.
Fiduciary Duties and Good Faith in Expulsion Decisions
Regardless of entity type, partners owe fiduciary duties to one another. Any attempt to remove a partner—whether through expulsion clauses or dissolution—must comply with duties of good faith, loyalty, and fairness.
In Chan Yuen Lan v See Fong Mun [2014] SGCA 36, the Court of Appeal reaffirmed that fiduciary obligations remain central in business relationships involving mutual trust. An expulsion exercised to seize assets, exclude profit participation, or silence dissent may expose the remaining partners to personal liability.
Practical Guidance for Business Owners
From a risk-management perspective, the safest way to manage partner exits is at the drafting stage. Well-prepared agreements typically include:
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Express expulsion grounds
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Supermajority voting thresholds
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Valuation and buy-out mechanisms
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Restraint and confidentiality provisions
Without these clauses, disputes frequently escalate into litigation, forced dissolution, or commercial deadlock.
Conclusion: Prevention Is Better Than Litigation
Singapore’s partnership laws deliberately make partner removal difficult. This protects individuals from arbitrary expulsion but places a premium on careful structuring and foresight. Whether you are forming a new partnership, restructuring an LLP, or dealing with a difficult partner, early legal and corporate advisory support can prevent disputes from becoming existential threats to the business. For tailored advice on partnership agreements, LLP restructuring, or partner exit strategies, we strongly recommend seeking professional guidance.
If you are facing a partnership dispute or wish to future-proof your partnership or LLP agreement, the team at Raffles Corporate Services can assist with structuring, compliance, and dispute-prevention strategies. Contact us at [email protected]
Yours sincerely,
The editorial team at Raffles Corporate Services