Carrie, Dicky and Eunice formed a partnership 3 years ago to run a Coca-Cola accessories shop from premises already owned by Carrie in Mongkok. At the time Carrie invested HK$100,000 into the business while Dicky invested HK$60,000 and Eunice invested HK$40,000. The partnership agreement stated that the business premises were to remain Carries property and that the partnership was to pay the rent of HK$2,500 per month for the use of premises. Another clause in the partnership agreement stated that all profits and losses should be divided in proportion to the capital contribution. After some time Dicky provided the partnership with a loan of HK$20,000 in order to finance more stock and this loan of HK$20,000 is to be paid back from the future profits of the business.

Unluckily, the business was not successful and made a loss. The partners concluded that it would be the best option to stop trading and to dissolve the partnership rather than to take risk resulting more losses.

At the time of the dissolution of the partnership, its assets were worth HK$150,000 and its external debts were HK$70,000. In addition, the partnership owed Carrie HK$10,000 in unpaid rent for the premises which were themselves valued at HK$1,000,000.

Required:

i) State briefly the grounds upon which a partnership can be terminated without any order from the court.

ii) Advise the partners as to how the financial aspects of the dissolution will be conducted and how the assets will be distributed.