Partnership partition

X Ltd is a residential property developer.

The shares in the unlisted company are owned by Mr A and his sons B C and D as to 30/30/30/10 respectively.

There is also a property investment partnership PP which holds and lets out commercial and residential property but does not develop property or trade in any way.

The partners are Mr A (12.5%) Mrs A (6%) B (30%) C (30%) and D (21.5%).

The partnership agreement states that on the death resignation or retirement of a partner he or she will only be entitled to the balance on their capital account; there is to be no revaluation of assets.

To meet differing aspirations the family businesses have been reorganised. B exchanged his interest in PP for 70% of shares in X Ltd. No cash was paid by either...