Partner
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This article is written by Kapil Nikam, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from Lawsikho.com. Here he discusses “Can a Non-Law Graduate become a Partner in a Law Firm?’.

 

Introduction

This is a fascinating question: How to become a partner in Law Firms or any partnership firm? Before analyzing this question in depth, we need to analyze this question based on factual position in the Indian legal industry. If we look at the names of various Law Firm partners, they are the graduates of reputed Law colleges from India. When we see Law Firm partners, there is a very remote example in Indian Law Firms who are non-law graduate. If someone has a Law degree and joins a Law Firm, after spending some time as an associate or senior associate, he/she becomes a partner in a Law Firm. 

If we see other sectors other than Law Firms, there are numerous examples where non-graduates are working as a partner. For exploring this question in depth, we need to examine the statutory position about the eligibility of partners in Legal as well as non-legal sectors. Whether a non-graduate can become a partner in Law firms or any other firm, we will examine said question elaborately in the present article.

In India, Indian Partnership Act deals with the provisions of partnership, in which we are going to discuss step by step, what is the criteria, eligibility to become a partner in the said Act. After perusal of this Act, it is explicit that Act only provides provision relating to partnership, whether it is proprietor firm or partnership firm, means all partnership firms whether it is Law Firms or any other Firms are governed by the Indian Partnership Act. 

Provisions of the Indian Partnership Act

Individuals may be in his/her capacity or a representative as Karta of Hindu Undivided family.

Section 4 of the Indian Partnership Act (Act) is crucial to discuss whether a non-law graduate can become a partner in the partnership firm. Section 4 of the Act defines Partnership, Partner, Firm and Firm Name. A partnership is a relationship between the persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Partners mean persons who have entered into a partnership with one another. Collectively as a Firm and the name on which their business is carried, is called “Firm-name”. Definitions given in section 4 are unambiguous and no specific restriction is given in the said section.

Section 5 of Indian Partnership Act (Act) states that the relationship of partnership arises from contract and not from status; it further states that member of Hindu Undivided family carrying on a family business as such, or Burmese Buddhist husband and wife carrying business as such are not partners in such business. As seen in Section 5 of the Act, it is explicit that the relationship of partnership arises from the contract. The scheme of this section is very important to understand the title of this article.

Considering the scheme of the Act and Indian Contract Act, who can become a partner?

Following persons can enter into a contract under the Indian Contract Act:

  • A person who is competent to enter contact;
  • A major person
  • A person who is of sound mind
  • A person who is not disqualified from entering into a contract. 

A person is not defined in the Act. A person means any individual and also includes Firm, a Company, Trustee, a partnership firm, Karta of Hindu Undivided Family. The Supreme Court in the matter of Commissioner of Income Tax Vs Kala Babu Lal Chand (AIR 1959 SC 1289) held that the person under the Act means either an individual or any other legal entity such as Limited Company registered under the Companies Act or any other Corporation constituted by or under any Act of the Legislature as a body corporate. The Supreme Court further held that HUF can not as such enter into a contract of partnership with another person because it is a fleeting body. However, an individual as Karta of HUF can become a partner, but he will be considered as an individual member.

The scheme of Act itself shows that a non-graduate of Law can become a Partner in the Firm. Any individual who can qualify the criteria mentioned hereinabove can become a partner in the partnership Firm. 

Why the partners in Law Firms are Law Graduates? We need to view the structures of law Firms to answer this question. In big Law Firms, there are several internal department’s who deal with various functions such as Litigation, Arbitration matters, matters related to Companies Law, matters related to real estate transactions, matters related to mergers and acquisitions, transaction matters, banking and financial translation-related matters, criminal matters etc. Some Law Firms are known as experts in specific areas. We can see that most of the transactions and issues connected with the Law Firms are relating to Law and law firms prefer to hire law Students for that because they are acquainted with provisions of Law. Though there is no bar to a non-Law student to become a partner in a law firm, structures of Law Firms necessitated that someone needs to be familiar with the Law. If a non-law graduate leads any transaction that time, it may adversely be impacted on some clients also. After completion of graduation in Law, anyone hired by a Law Firm would not directly become a partner in a Law Firm, but, in initial years he or she will work as an Associate, Senior Associate, Junior Partner and then, become a Partner. As far as Litigation matters are concerned, sometimes Litigation Partners appears in a Court as a representative of Client and as per provisions of Advocates Act and rules and regulations set out by respective bar councils, non-law graduate can not represent any client. Given hereinabove though it is not a requirement of Law graduate to become a Partner considering structures in Indian Law Firms and mindset of people, it is imperative to be a Law graduate to become a Partner.

Role of non-Law graduate in Law Firms 

As seen hereinabove, in several departments of Law Firms, we have seen functions relating to Law. However, there are other departments also whose roles are also useful in Law Firms. Administrative, Accounts, Human and Resource departments are also essential in Law Firms, and non-graduates can perform their role effectively in such departments of law firms, and based on their performance, they can become partners also. Some Law Firms extensively use their marketing strategy to expand their client bases, a person who is good in the marketing field can render his services to Law Firms, and he can become a partner after showing his performance. After 1991, India has adopted a free economy, therefore, client bases are not restricted to India. Several multinational companies are doing business in India, so those who are well versed with Finance and Economy can provide his services or be hired by Law Firms and become Partner in Law Firms.

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There are no restrictions for a law graduate to become a partner in any other Firms also. Various proprietorship firms and partnership firms are functioning in India in various sectors. A non-law graduate can become a partner in these Firms. Our focus in this article is related to law firms. However, there are several starts up in India which start as a Partnership Firm, but after that, if the need arises, they form a Private Limited Company or Company. A non-law graduate can become a partner in such firms based upon his area of interest and expertise and venture capacity in a particular area. In the Indian economy and commercial world, Partnership Firms have significance and day by day their scope will be expanded.

Conclusion

We have seen whether non-law graduate become a partner in a law firm or a firm. We have visited various statutory provisions of the Indian Partnership Act, 1932 (9 of 1932). In terms of the partnership, we have seen the scheme of the Act. Also, why in law firms, law graduate is hired as an associate, and procedure to become a partner. In terms of legal provisions, it is explicitly clear that there is no statutory bar for a non-legal graduate to become a partner in a firm. In today’s scenario, Law Firms and Firms are diversified in various areas, and they are hiring non-law graduate persons also, since they require specific expertise in a particular area. In the present article, it is explained, in which areas, non-law graduate can render their services and the same shall be utilized by the Law Firms. 

In the present article, though we had a discussion relating to law firm perspective, but we have also examined other firms that are providing their services in various areas. This article is useful for those non-law graduates who are eager to venture into their careers in the Law Firm world and general firms also.


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