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“The person who sold ice cream in our bungalow colony is not coming back this year,” Ben said to Jeremy. “Would you like to join me in a business selling ice cream?

“I would,” replied Jeremy. “It seems profitable! What do we need?”

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“A large freezer and lots of ice cream!” Ben laughed.

The two invested in a freezer and stocked it with a huge quantity of ice cream.

A few weeks later Ben decided he wanted out of the joint business. He felt he could do better on his own.

“But we agreed to sell together,” objected Jeremy. “You can’t pull out on me!”

“You can’t keep me bound to you,” insisted Ben. “We’ll split the remaining ice cream, and either you pay me half for the freezer, or I’ll pay you half.”

“I’m not going to invest in a freezer on my own,” said Jeremy. “We also bought a large stock of ice cream and still have a lot that hasn’t been sold. You committed to sell throughout the summer.”

“I never said I would remain a partner all summer,” responded Ben.

“I think we should ask Rabbi Dayan whether or not you can break off.”

“That’s fine with me,” said Ben.

The two approached Rabbi Dayan and posed the question to him. He replied, “If a time was set for the partnership – for example, until the end of August – you must stay until that time and then you may dissolve the partnership. If you to continue together after this time, the partnership continues with whatever terms were initially agreed.

“However, if you stated that you want to dissolve the partnership and Jeremy continued to do business with the joint money afterwards, the gain and loss is his.” [Choshen Misphat 176:15, 23; Pischei Choshen, Shutfim 3:4(10)]

“What if there was no set time?” asked Jeremy.

“In that case, each partner can unilaterally dissolve the partnership at any time,” replied Rabbi Dayan.

“The assets should be divided, or sold if dividing them would cause a loss. However, if the merchandise is seasonal and has to wait for a certain time to be sold, you cannot dissolve the partnership until the merchandise is sold at its proper time. Some maintain that if the merchandise is meant to be sold little by little, you must also wait until it is sold since that is like waiting for its proper time.” [Choshen Misphat 176:16-17; Kesef Kodashim 176:17; Pischei Choshen, Shutfim 3(5)]

“Furthermore, Nesivos [176:34, 8] maintains that even when no time was set, you can dissolve the partnership unilaterally only when the other party is restricting the business,” added Rabbi Dayan. “If he wants to continue selling together, but you want to break off and work alone, you cannot unilaterally dissolve the partnership since you committed to work together, and mazla d’bei trei adif (joint fortune is better).

“It is unclear how long you must continue; presumably, until the current merchandise is sold. Chochmas Shlomo [176:16] seemingly disagrees and maintains that the partners are not committed when no time was set.”

“Where does this leave us?” asked Ben.

“If the partnership was set until a certain time, you cannot break off beforehand,” answered Rabbi Dayan. “If you did not stipulate a time, you still should wait until the current merchandise is sold since ice cream is meant to be sold little by little and Ben is interested in continuing to sell together.”

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Rabbi Meir Orlian is a faculty member of the Business Halacha Institute, headed by HaRav Chaim Kohn, a noted dayan. To receive BHI’s free newsletter, Business Weekly, send an e-mail to subscribe@businesshalacha.com. For questions regarding business halacha issues, or to bring a BHI lecturer to your business or shul, call the confidential hotline at 877-845-8455 or e-mail ask@businesshalacha.com.