Limited shelf life

Simon Young gives two good reasons why it is not necessary or desirable for a solicitors' firm to incorporate as a limited liability partnership (LLP) merely to reserve the name it wants (see [2001] Gazette, 20 April, 14).

A third reason is that it may not be lawful to incorporate an LLP before the prospective members have taken the decision to go down the LLP route.

The Limited Liability Partnerships Act 2000 requires that for an LLP to be incorporated there must be 'two or more persons associated for carrying on a lawful business with a view to profit' (section 2 (1)(a)).

There must be delivered to the registrar of companies a statement, which is signed by a founding member or a solicitor involved in the incorporation, confirming that this requirement has been complied with.

Making a false statement for this purpose is an offence (section 2 (3)).

My question is this: is it possible for prospective LLP members to be 'associated for carrying on a lawful business with a view to profit' if they have not yet decided whether to transfer the business of their partnership to the LLP? An LLP incorporated merely to be 'put on the shelf' has no business and therefore no view to profit.

Don't the words of section 2 (1) imply that the founding members must at least have decided in principle to practise as an LLP? If this doubt is well founded, it means that it is not possible to incorporate a 'shelf' LLP.

Stephen Williams, partner, Cripps Harries Hall, Tunbridge Wells