Liabilities of General Partners to Third Parties

Question 1

Agency Principles Apply

Answer 1

1) Partners are agents of the partnership for apparently carrying on usual partnership business
2) Therefore, the general partnership is liable for each partner’s torts in the scope of partnership and for each partner’s authorized contracts

Question 2

Each general partner is personally liable for:

Answer 2

ALL debts of the partnership AND for each co-partner’s torts

Question 3

Incoming Partner’s liability for pre-existing debts

Answer 3

Incoming partner is generally not liable for pre-existing debts, BUT any money pain in to the partnership by incoming partner can be used by partnership to satisfy pre-existing debts

Question 4

Dissociating (withdrawing) partner’s liability for subsequent debts:

Answer 4

Dissociating partners retain liability on all future debts until actual notice of dissociation is given to creditors OR until 90 days after filing notice of dissociation with the state.

Question 5

General Partnership Liability by Estoppel

Answer 5

One who represents to a third party that a general partnership exists will be liable as if a general partnership exists, even if not really a general partner