General Partnership Flashcards
(30 cards)
GP - Filing
Not required
GP - Taxation
only taxed at the partner level
Partnership Agreement
UPA § 6 and RUPA
A general partnership is formed whenever there is an association of two or more people that carry on as co-owners a business for profit
RUPA - Entity View of Partnership
partnership is separate and distinct from partners
UPA - Aggregate View of Partnership
The partnership is aggregate with its partners and has no separate legal status
At will partnership, default under UPA and RUPA
The partners have no specified any definite term or particular undertaking for the partnership.
Term Partnership
Partners have agree, explicitly or implicitly, that the partnership shall have a definite term or particular undertaking.
Inadvertent Partnership
Receiving a share of profits is prima facie evidence that a person is a partner. A person must make clear that they do not want to be a partner or there will be default partnership.
Capital Labor Partnership
One partner puts only capital while the other puts only labor
Partnership Management
UPA § 18
Any difference arising as to ordinary matters connected with the partnership may be decided by a majority of the partners unless there is an agreement that states otherwise.
-must be a majority vote
Agents of Partnership
UPA § 9
every partner is an agent of the partnership for carrying on biz as usual, unless the partner has no authority to act for the partnership in a particular manner.
GP: Sharing of Profits and Losses
UPA § 18, RUPA § 401
Each partner shall (1) be repaid their contribution and share equally in the profits and surplus and (2) must contribute to losses proportional to share in profits
GP: Profits and Losses - Labor
UPA and RUPA
Labor is not valued. If profits are equally shared, then losses are equally shared.
GP - Partnership’s Liability to Third Parties (what liable for)
(1) K’s entered into on behalf of partner’s authority
(2) any wrongful act or omission of a partner acting in the ordinary course of biz or w/ authority of co-partners
(3) specific circumstances: if partner misapplies money or property of 3rd person
GP - Partners Liability to Third Parties
UPA § 15
Joint liability for contracts. Joint and several liability for torts.
GP - Partners Liability to Third Parties
RUPA § 306
Joint and several liability for all obligations
GP - Indemnification
In absence of a contrary agreement, a partnership must indemnify a partner for payments made and liabilities incurred by the partner in the ordinary course of the partnership business
GP - Fiduciary duties
UPA
broad essentially undefined
GP - Fiduciary duties
RUPA § 404
Partners only owe a duty of loyalty and duty of care to each other
Partnership Property
UPA § 25
a partnership is co-owner with other partners of specific partnership property
Partnership Property
RUPA § 501
A partner is not a co-owner of partnership property and has no interest in partnership property
Transferable Interest under
RUPA § 502
The only transferable interest of a partner in the partnership is the partner’s share of the profits and losses of the partnership, and the partner’s rights to receive distributions.
Order of Priorities (order of payment)
UPA § 40
Owed debts:
(1) non-party creditors, (2) partner creditors,
If $ leftover:
(3) return of capital, (4) return of profits.
Partnership Creditors rights
Have rights to both individual and partnership property
