c Partnership 1

8/13/2019 c Partnership 1

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Ateneo notes (2002)

PARTNERSHIP - by the contract of partnership, 2 or more persons bind themselves tocontribute money, property or industry to a common fund, with the intention of dividing the

profits among themselves

ESSENTIAL FEATURES:

1. There must be a valid contract

2. The parties must have legal capacity to enter into the contract

3. There must be a mutual contribution of money, property, or industry to a common fund

4. The object must be lawful

5. The purpose or primary purpose must be to obtain profits and divide the same among the

parties

PARTNERSHIP DISTINGUISHED FROM CO-OWNERSHIP AND CORPORATION

PARTNERSHIP CO-OWNERSHIP CORPORATION

Creation Created by a contract, mymere agreement of theparties

Created by law Created by law

Juridicalpersonality

Has a juridical personalityseparate and distinct fromthat of each partner

None Has a juridical personality separate anddistinct from that of each partner

Purpose Realization of profits Common enjoyment of athing or right

Depends on AO

Duration/ Term ofexistence

No limitation !" years ma#imum $" years ma#imum, e#tendible to notmore than $" years in any one instance

Disposal/Transferability ofinterest

%artner may not dispose ofhis indi&idual interest unlessagreed upon by all partners

Co'owner may freely do so (toc)holder has a right to transfershares without prior consent of otherstoc)holders

Power to act with3rdpersons

n absence of stipulation tocontrary, a partner may bindpartnership *each partner isagent of partnership+

Co'owner cannot representthe co'ownership

anagement is &ested with the -oardof Directors

Effect of death Death of partner results indissolution of partnership

Death of co'owner does notnecessarily dissol&e co'ownership

Death of stoc)holder does not dissol&ecorporation

Dissolution ay be dissol&ed at any time

by the will of any or all of thepartners

ay be dissol&ed anytime by

the will of any or all of the co'owners

Can only be dissol&ed with the consent

of the state

No. ofincorporators

inimum of . persons inimum of . persons inimum of $ incorporators

Commencementof !uridical

personality

/rom the moment ofe#ecution of contract ofpartnership

/rom date of issuance ofcertificate of incorporation bythe (0C

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NO PRESUMPTION OF PARTNERSHIP FROM RECEIPT OF PROFITS:

1. s debt by installment

2. s wages or rent

3. s annuity

4. s interest on loan

5. s consideration for sale of goodwill of business!other property by installments

SIMILARITIES BETWEEN A PARTNERSHIP AND A CORPORATION

1. "oth have juridical personality separate and distinct from that of the individuals composing it

2. "oth can only act through agents

3. "oth organi#ations are composed of an aggregate of individuals $e%cept corporation sole&

4. "oth distribute profits to those who contribute capital to the business

5. "oth can only be organi#ed when there is a law authori#ing their organi#ation

'. "oth are ta%able as a corporation

EFFECTS OF UNLAWFUL PARTNERSHIP

1. The contract is void ab initio and the partnership never e%isted in the eyes of the law

2. The profits shall be confiscated in favor of the government

3. The instruments or tools and proceeds of the crime shall also be forfeited in favor of the

government

4. The contributions of the partners shall not be confiscated unless they fall under no. 3

FORM OF PARTNERSHIP CONTRACT

GENERAL RULE( )o special form is re*uired for the validity of the contract

ECEPTIONS:

1. Where immovable property/real rights are contributed

a. +ublic instrument is necessary

b. nventory of the property contributed must be made, signed by the parties and attached to

the public instrument otherwise it is -/

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2. Where capital is P3,000 or more, in money or property

a. +ublic instrument is necessary

b. 0ust be registered with

CLASSIFICATIONS OF PARTNERSHIP

!" As to e#tent o$ %ts s&'et *+tte,

+" UNIERSAL PARTNERSHIP

i. UNIERSAL PARTNERSHIP OF ALL PRESENT PROPERT. - comprises the

following(

a& +roperty which belonged to each of the partners at the time of the constitutionof the partnership

b& +rofits which they may ac*uire from all property contributed

%%" UNIERSAL PARTNERSHIP OF PROFITS - comprises all that the partners mayac*uire by their industry or wor during the e%istence of the partnership

Note: Persons who are prohibited from giving donations or advantage to each other

cannot enter into a universal partnership

b. PARTICULAR PARTNERSHIP has for its objects(

i. /eterminate things

ii. Their use or fruits

iii. pecific undertaing

iv. %ercise of profession or vocation

2" As to /%+'%/%t o$ 1+,tne,s

a. GENERAL PARTNERSHIP consists of general partners who are liable pro rata and

subsidiarily and sometimes solidarily with their separate property for partnership debts

b. LIMITED PARTNERSHIP one formed by 2 or more persons having as members one

or more general partners and one or more limited partners, the latter not being personallyliable for the obligations of the partnership

" As to 3&,+t%on

a. PARTNERSHIP AT WILL one in which no time is specified and is not formed for a

particular undertaing or venture which may be terminated anytime by mutual agreement

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b. PARTNERSHIP WITH A FIED TERM the term for which the partnership is to

e%ist is fi%ed or agreed upon or one formed for a particular undertaing

4" As to /e5+/%t o$ e#%stene

a. DE 6URE PARTNERSHIP one which has complied with all the legal re*uirementsfor its establishment

b. DE FACTO one which has failed to comply with all the legal re*uirements for itsestablishment

7" As to ,e1,esent+t%on to ot8e,s

a. ORDINAR. OR REAL PARTNERSHIP one which actually e%ists among the

partners and also as to 3rdpersons

b. OSTENSIBLE OR PARTNERSHIP B. ESTOPPEL one which in reality is not apartnership but is considered a partnership only in relation to those who, by their conduct

or omission, are precluded to deny or disprove its e%istence

9" As to 1&'/%%t

a. SECRET PARTNERSHIP one wherein the e%istence of certain persons as partners is

not avowed or made nown to the public by any of the partners

b. OPEN OF NOTORIOUS PARTNERSHIP one whose e%istence is avowed or madenown to the public by the members of the firm

" As to 1&,1ose

a. COMMERCIAL OR TRADING PARTNERSHIP one formed for the transaction of

'&s%ness

b. PROFESSIONAL OR NON TRADING PARTNERSHIP one formed for the

e%ercise of a profession

;INDS OF PARTNERS

1. CAPITALIST one who contributes money or property to the common fund

2. INDUSTRIAL one who contributes only his industry or personal service

3. GENERAL one whose liability to 3rdpersons e%tends to his separate property

4. LIMITED one whose liability to 3rdpersons is limited to his capital contribution

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5. MANAGING one who manages the affairs or business of the partnership

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1. To contribute at the beginning of the partnership or at the stipulated time the money, property

or industry which he may have promised to contribute

2. To answer for eviction in case the partnership is deprived of the determinate property

contributed

3. To answer to the partnership for the fruits of the property the contribution of which he

delayed, from the date they should have been contributed up to the time of actual delivery

4. To preserve said property with the diligence of a good father of a family pending delivery to

partnership

5. To indemnify partnership for any damage caused to it by the retention of the same or by thedelay in its contribution

E$$et o$ F+%/&,e to ont,%'&te 1,o1e,t 1,o*%se3:

1. +artners becomes ipso jure a debtor of the partnership even in the absence of any demand

2. ;emedy of the other partner is not rescission but specific performance with damages from

defaulting partner

O'/%5+t%ons =%t8 ,es1et to ont,%'&t%on o$ *one +n3 *one on>e,te3 to 1e,son+/ &se

1. To contribute on the date fi%ed the amount he has undertaen to contribute to the partnership

2. To reimburse any amount he may have taen from the partnership coffers and converted to

his own use

3. To pay for the agreed or legal interest, if he fails to pay his contribution on time or in case he

taes any amount from the common fund and converts it to his own use

4. To indemnify the partnership for the damages caused to it by delay in the contribution or

conversion of any sum for his personal benefits

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PROHIBITION AGAINST ENGAGING IN BUSINESS

INDUSTRIAL PARTNER CAPITALIST PARTNER

P"#$%&%T%#N ndustrial partner cannot engage inbusiness *w1n same line of business withthe partnership+ unless partnershipe#pressly permits him to do so

Capitalist partner cannot engage in business*with same )ind of business with the partnership+for his own account, unless there is a stipulationto the contrary

"E'ED( Capitalist partners may2!3 0#clude him from the firm, or.3 A&ail themsel&es of the benefits which

he may ha&e obtained43 Damages, in either case

Note: It is believed that industrialpartners are also entitled to the remedygranted since they are equallyprejudiced

Capitalist partner in &iolation shall2!3 -ring to common fund any profits accruing to

him from said transaction, and.3 -ear all losses

O'/%5+t%ons =%t8 ,es1et to ont,%'&t%on to 1+,tne,s8%1 +1%t+/

1. +artners must contribute e*ual shares to the capital of the partnership unless there is

stipulation to contrary

2. +artners $capitalist& must contribute additional capital n case of imminent loss to the

business of the partnership and there is no stipulation otherwise< refusal to do so shall createan obligation on his part to sell his interest to the other partners

Re?&%s%tes:

a. There is an imminent loss of the business of the partnership

b. The majority of the capitalist partners are of the opinion that an additional contribution tothe common fund would save the business

c. The capitalist partner refuses deliberately to contribute $not due to financial inability&

d. There is no agreement to the contrary

O'/%5+t%on o$ *+n+5%n5 1+,tne,s =8o o//ets 3e't $,o* 1e,son =8o +/so o=e3 t8e

1+,tne,s8%1

1. pply sum collected to 2 credits in proportion to their amounts

2. f he received it for the account of partnership, the whole sum shall be applied to partnership

credit

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Re?&%s%tes:

a. There e%ist at least 2 debts, one where the collecting partner is creditor and the other,where the partnership is the creditor

b. "oth debts are demandable

c. The partner who collects is authori#ed to manage and actually manages the partnership

O'/%5+t%on o$ 1+,tne, =8o ,ee%>es s8+,e o$ 1+,tne,s8%1 ,e3%t

1. bliged to bring to the partnership capital what he has received even though he may have

given receipt for his share only

Re?&%s%tes:

a. partner has received in whole or in part, his share of the partnership credit

b. The other partners have not collected their shares

c. The partnership debtor has become insolvent

RIS; OF LOSS OF THINGS CONTRIBUTED(pecific and determinate things which are not fungible where onlythe use is contributed

Ris) is borne by partner

(pecific and determinate things the ownership of which istransferred to the partnership

Ris) is borne by partnership

/ungible things *consumable+ Ris) is borne by partnership

5hings contributed to be sold Ris) is borne by partnership

5hings brought and appraised in the in&entory Ris) is borne by partnership

RULES FOR DISTRIBUTION OF PROFITS AND LOSSESDISTRIBUTION OF PROFITS DISTRIBUTION OF LOSSES

)ith a*reement According to agreement According to agreement

)ithout a*reement !3 (hare of capitalist partner is inproportion to his capital contribution

.3 (hare of industrial partner is not fi#ed' as may be just and e6uitable underthe circumstances

!3 f sharing of profits is stipulated ' apply tosharing of losses

.3 f no profit sharing stipulated ' losses shallbe borne according to capital contribution

43 %urely industrial partner not liable forlosses

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RIGHTS AND OBLIGATIONS WITH RESPECT TO MANAGEMENTPartner is appointed mana*er inthe articles of partnership

%ower of managing partner isirre&ocable without just1lawfulcause7 Re&ocable only when inbad faith

8ote of partners representing controllinginterest necessary to re&o)e power

Partner is appointed mana*er

after constitution of partnership

%ower is re&ocable any time for

any cause+ or more persons entrusted withmana*ement of partnershipwithout specification ofduties/stipulation that each shallnot act w/o the other,s consent

0ach may e#ecute all acts ofadministration

n case of opposition, decision of majorityshall pre&ail7 n case of tie, decision ofpartners owning controlling interest shallpre&ail

-tipulated that none of themana*in* partners shall act w/othe consent of others

Concurrence of all necessary forthe &alidity of acts

Absence or disability of any one cannotbe alleged unless there is imminentdanger of gra&e or irreparable injury topartnership

'anner of mana*ement nota*reed upon

!3 All partners are agents of thepartnership

.3 9nanimous consent re6uiredfor alteration of immo&ableproperty

f refusal of partner is manifestlyprejudicial to interest of partnership,

court:s inter&ention may be sought

Ot8e, ,%58ts +n3 o'/%5+t%ons o$ 1+,tne,s:

1. ;ight to associate another person with him in his share without consent of other partners$subpartnership&

2. ;ight to inspect and copy partnership boos at any reasonable hour

3. ;ight to a formal account as to partnership affairs $even during e%istence of partnership&(

a. f he is wrongfully e%cluded from partnership business or possession of its property byhis copartners

b. f right e%ists under the terms of any agreement

c. s provided by art 1796

d. =henever other circumstances render it just and reasonable

4. /uty to render on demand true and full information affecting partnership to any partner or

legal representative of any deceased partner or of any partner under legal disability

5. /uty to account to the partnership as fiduciary

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B. P%OP$%( %IG#! O" A PA%N$%

1. >is rights in specific partnership property

2. >is interest in the partnership

3. >is right to participate in the management

N+t&,e o$ 1+,tne,@s ,%58t %n s1e%$% 1+,tne,s8%1 1,o1e,t

1. *ual right to possession

2. ;ight not assignable

3. ;ight limited to share of what remains after partnership debts have been paid

N+t&,e o$ 1+,tne,@s ,%58t %n t8e 1+,tne,s8%1

1. hare of profits and surplus

). OBLIGAION O" PA%N$%! *I# %$GA%+ O ,%+P$%!ON!

1. very partnership shall operate under a firm name. +ersons who include their names in the

partnership name even if they are not members shall be liable as a partner

2. ll partners shall be liable for contractual obligations of the partnership with their property,

after all partnership assets have been e%hausted

a. +ro ratab. ubsidiary

3. dmission or representation made by any partner concerning partnership affairs within scope

of his authority is evidence against the partnership

4. Notice to partner o any matter relating to partnership aairs operates as notice to

partnership e!cept in case o raud"

a. ?nowledge of partner acting in the particular matter ac*uired while a partner

b. ?nowledge of the partner acting in the particular matter then present to his mind

c. ?nowledge of any other partner who reasonably could and should have

communicated it to the acting partner

5. +artners and the partnership are solidary liable to 3rdpersons for the partner:s tort or breach of

trust

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#. $iability o incoming partner is limited to"

a. >is share in the partnership property for e%isting obligations

b. >is separate property for subse*uent obligations

6. reditors of partnership preferred in partnership property @ may attach partner:s share in

partnership assets

7. very partner is an agent of the partnership

POWER OF PARTNER AS AGENT OF PARTNERSHIPActs for carrying on in the usual way the business of the partnership 0&ery partner is an agent and may e#ecute

acts with binding effect e&en if he has noauthority0#cept2 when 4rdperson has )nowledge oflac) of authority

!3 Act w1c is not apparently for the carrying of business in theusual way

+. cts of strict dominion or ownershipa3 Assign partnership property in trust for creditors

b3 Dispose of good'will of business

c3 Do an act w1c would ma)e it impossible to carry onordinary business of partnership

d3 Confess a judgement

e3 0nter into compromise concerning a partnership claim orliability

f3 (ubmit partnership claim or liability to arbitration

g3 Renounce claim of partnership

Does not bind partnership unlessauthorized by other partners

Acts in contra&ention of a restriction on authority %artnership not liable to 4rdpersons ha&ingactual or presumpti&e )nowledge of therestrictions

EFFECTS OF CONE.ANCE OF REAL PROPERT. BELONGING TO

PARTNERSHIP5itle in partnership name,Con&eyance in partnership name

Con0eyance passes title but partnership can reco0er if

!3 Con&eyance was not in the usual way of business, or

.3 -uyer had )nowledge of lac) of authority

5itle in partnership name,Con&eyance in partner:s name

Con0eyance does not pass title but only e1uitable interest2 unless

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5itle in name of !1 more partners,Con&eyance in name ifpartner1partners in whose name

title stands

Con0eyance passes title but partnership can reco0er if



5itle in name of !1more1all partnersor 4rd person in trust forpartnership, Con&eyance e#ecutedin partnership name of in name ofpartners

Con&eyance will only pass e6uitable interest

5itle in name of all partners,Con&eyance in name of all partners

Con&eyance will pass title

PARTNER B. ESTOPPEL PARTNERSHIP B. ESTOPPEL

P+,tne, ' esto11e/% by &ords or conduct, he does any o the ."

1. /irectly represents himself to anyone as a partner in an e%isting partnership or in a non

e%isting partnership

2. ndirectly represents himself by consenting to another representing him as a partner in an

e%isting partnership or in a non e%isting partnership

E/e*ents to est+'/%s8 /%+'%/%t +s + 1+,tne, on 5,o&n3 o$ esto11e/:

1. /efendant represented himself as partner!represented by others as such and not

denied!refuted by defendant

2. +laintiff relied on such representation

3. tatement of defendant not refuted

L%+'%/%t%es %n esto11e/All partners consented to representation %artnership is liable

No e#isting partnership ; all those represented consented7

Not all partners of e#isting partnership consents to representation

%erson who represented himself ; all those

who made representation liable pro'rata1jointly

No e#isting partnership ; not all represented consented7None of partners in e#isting partnership consented

%erson who represented himself liable ;those who made1consented torepresentation separately liable

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+. %$!PON!IBILI( O" PA%N$%!#IP O PA%N$%!

1. To refund the amounts disbursed by partner in behalf of the partnership A corresponding

interest from the time the e%penses are made $loans and advances made by a partner to thepartnership aside from capital contribution&

2. To answer for obligations partner may have contracted in good faith in the interest of thepartnership business

3. To answer for riss in conse*uence of its management

DISSOLUTION AND WINDING UP

DISSOLUTION change in the relation of the partners caused by any partner ceasing to be

associated in the carrying on of the business< partnership is not terminated but continues until thewinding up of partnership affairs is completed

WINDING UP process of settling the business or partnership affairs after dissolution

CAUSES OF DISSOLUTION:

1. Without violation o the agreement bet&een the partners

a. "y termination of the definite term! particular undertaing specified in the agreement

b. "y the e%press will of any partner, who must act in good faith, when no definite term

or particular undertaing is specified

c. "y the e%press will of all the partners who have not assigned their interest! charged

them for their separate debts, either before or after the termination of any specifiedterm or particular undertaing

d. "y the e%pulsion of any partner from the business bonafide in accordance with power

conferred by the agreement

2. n contravention of the agreement between the partners, where the circumstances do not

permit a dissolution under any other provision of this article, by the e%press will of anypartner at any time

3. "y any event which maes it unlawful for business to be carried on!for the members to carryit on for the partnership

4. Boss of specific thing promised by partner before its delivery

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5. /eath of any partner

'. nsolvency of a partner!partnership

6. ivil interdiction of any partner

7. /ecree of court under art 1731

GROUNDS FOR DISSOLUTION B. DECREE OF COURT (+,t !!)

1. +artner declared insane in any judicial proceeding or shown to be of unsound mind

2. ncapacity of partner to perform his part of the partnership contract

3. +artner guilty of conduct prejudicial to business of partnership

4. =illful or persistent breach of partnership agreement or conduct which maes it reasonablyimpracticable to carry on partnership with him

5. "usiness can only be carried on at a loss

'. ther circumstances which render dissolution e*uitable

'pon application by purchaser o partner(s interest"

1. fter termination of specified term!particular undertaing

2. nytime if partnership at will when interest was assigned!charging order issued

EFFECTS OF DISSOLUTION:

A. A-#O%I( O" PA%N$% O BIN+ PA%N$%!#IP

Gene,+/ R&/e( uthority of partners to bind partnership is terminated

E#e1t%on:

1. =ind up partnership affairs

2. omplete transactions not finished


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b. ) due to *+), partners are liable as i partnership not dissolved, &hen the . concur"

i. f cause is T of partner, acting partner must have nowledge of such dissolution

ii. f cause is /T> or )B-)C, acting partner must have nowledge! notice

2" W%t8 ,es1et to 1e,sons not 1+,tne,s (+,t !4) -

a. Partner continues to bind partnership even ater dissolution in . cases"

$1& Transactions in connection to winding up partnership affairs!completing transactions

unfinished

2- ransactions &hich &ould bind partnership i not dissolved, &hen the other

party/obligee"

$a& ituation 1 i. >ad e%tended credit to partnership prior to dissolution @

ii. >ad no nowledge!notice of dissolution, or

$b& ituation 2

i. /id not e%tend credit to partnership

ii. >ad nown partnership prior to dissolution

iii. >ad no nowledge!notice of dissolution!fact of dissolution not advertised in anewspaper of general circulation in the place where partnership is regularly

carried on

b. Partner cannot bind the partnership anymore ater dissolution"

$1& =here dissolution is due to unlawfulness to carry on with business $e%cept( winding

up of partnership affairs&

$2& =here partner has become insolvent

3- Where partner unauthoried to &ind up partnership aairs, e!cept by transaction&ith one &ho"

$a& ituation 1 i. >ad e%tended credit to partnership prior to dissolution @

ii. >ad no nowledge!notice of dissolution, or

$b& ituation 2

i. /id not e%tend credit to partnership prior to dissolution

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ii. >ad nown partnership prior to dissolution

iii. >ad no nowledge!notice of dissolution!fact of dissolution not advertised in anewspaper of general circulation in the place where partnership is

regularly carried on

B. +I!)#A%G$ O" LIABILI(D

+issolution does not discharge e!isting liability o partner, e!cept by agreement bet&een"

$1& partner himself

$2& person!partnership continuing the business

$3& partnership creditors

R%58ts o$ 1+,tne, =8e,e 3%sso/&t%on not %n ont,+>ent%on o$ +5,ee*ent

1. pply partnership property to discharge liabilities of partnership

2. pply surplus, if any to pay in cash the net amount owed to partners

R%58ts o$ 1+,tne, =8e,e 3%sso/&t%on %n ont,+>ent%on o$ +5,ee*ent

1. Partner &ho did not cause dissolution &rongully"

a. pply partnership property to discharge liabilities of partnership

b. pply surplus, if any to pay in cash the net amount owed to partners

c. ndemnity for damages caused by partner guilty of wrongful dissolution

d. ontinue business in same name during agreed term

e. +osses partnership property if business is continued

2. Partner &ho &rongly caused dissolution"

a. ) business not continued by others apply partnership property to discharge liabilities ofpartnership @ receive in cash his share of surplus less damages caused by his wrongful

dissolution

b. ) business continued by others have the value of his interest at time of dissolutionascertained and paid in cash!secured by bond @ be released from all e%isting!future

partnership liabilities

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R%58ts o$ %n&,e3 1+,tne, =8e,e 1+,tne,s8%1 ont,+t %s ,es%n3e3 on 5,o&n3 o$

$,+&3*%s,e1,esent+t%on ' ! 1+,t:

1. ;ight to lien on surplus of partnership property after satisfying partnership liabilities

2. ;ight to subrogation in place of creditors after payment of partnership liabilities

3. ;ight of indemnification by guilty partner against all partnership debts @ liabilities

). !$L$&$N O" A))O-N! B$*$$N PA%N$%!

Assets o$ t8e 1+,tne,s8%1:

1. +artnership property $including goodwill&

2. ontributions of the partners

O,3e, o$ A11/%+t%on o$ Assets:

1. +artnership creditors

2. +artners as creditors

3. +artners as investors return of capital contribution

4. +artners as investors share of profits if any

+. *#$N B-!IN$!! O" +I!!OL'$+ PA%N$%!#IP I! )ONIN-$+:

1. reditors of old partnership are also creditors of the new partnership which continues the

business of the old one w!o li*uidation of the partnership affairs

2. reditors have an e*uitable lien on the consideration paid to the retiring !deceased partner by

the purchaser when retiring!deceased partner sold his interest w!o final settlement with

creditors

3. ights i retiring/estate o deceased partner"

a. To have the value of his interest ascertained as of the date of dissolution

b. To receive as ordinary creditor the value of his share in the dissolved partnership with

interest or profits attributable to use of his right, at his option

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R%58t to Ao&nt may be e!ercised by"

1. =inding up partner

2. urviving partner

3. +erson!partnership continuing the business

M+nne, o$ W%n3%n5 U1

1. Eudicially

2. %trajudicially

Pe,sons A&t8o,%e3 to W%n3 U1

1. +artners designated by the agreement

2. n absence of agreement, all partners who have not wrongfully dissolved the partnership

3. Begal representative of last surviving partner

LIMITED PARTNERSHIP

CHARACTERISTICS

1. Formed by compliance with statutory re*uirements

2. ne or more general partners control the business

3. ne or more general partners contribute to the capital and share in the profits but do not

participate in the management of the business and are not personally liable for partnership

obligations beyond their capital contributions

4. 0ay as for the return of their capital contributions under conditions prescribed by law

5. +artnership debts are paid out of common fund and the individual properties of generalpartners

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DIFFERENCES BETWEEN GENERAL AND LIM%TED PARTNERPARTNERSHIPGENERAL LIMITED

%ersonally liable for partnership obligations


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4. +ossess partnership property!assign rights in specific partnership property other than for

partnership purposes

5. dmit person as general partner

'. dmit person as limited partner unless authori#ed in certificate

6. ontinue business with partnership property on death, retirement, civil interdiction, insanityor insolvency of gen partner unless authori#ed in certificate

SPECIFIC RIGHTS OF LIMITED PARTNERS:

1. ;ight to have partnership boos ept at principal place of business

2. ;ight to inspect!copy boos at reasonable hour

3. ;ight to have on demand true and full info of all things affecting partnership

4. ;ight to have formal account of partnership affairs whenever circumstances render it just and

reasonable

5. ;ight to as for dissolution and winding up by decree of court

'. ;ight to receive share of profits!other compensation by way of income

6. ;ight to receive return of contributions provided the partnership assets are in e%cess of all its

liabilities

LOAN AND OTHER BUSINESS TRANSACTIONS WITH LIMITED PARTNERSHIP

1. *llo&ed

a. Hranting loans to partnership

b. Transacting business with partnership

c. ;eceiving pro rata share of partnership assets with general creditors if he is not also a

general partner

2. +rohibited

a. ;eceiving!holding partnership property as collateral security

b. ;eceiving any payment, conveyance, release from liability if it will prejudice right of

3rdpersons

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'. hange in character of business

6. False!erroneous statement in certificate

7. hange in time as stated in the certificate for dissolution of partnership!return of

contribution

8. Time is fi%ed for dissolution of partnership. ;eturn of contribution if no orig. time

specified

19. hange in other statement in certificate

Documents

c Partnership 1