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Flashcards in Registered Limited Liability Partnership Deck (7)
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1

What is a registered limited liability partnership "LLP"?

  • a general partnership authorized by NY statute to adopt a liablity shield for its general partners

2

When may an LLP status be elected?

  • only elected by general partnerships who members are professionals
    • attys, accts

3

What must be filed for an LLP?

  • Have to file a statement of qualification witht he state

4

What must the LLP include?

  • the designation LLP after the pasrtnership name

5

What does the limited liability shield the general partners from in an lLP?

  • shield from personal liability for the partnership debts
    • the partnership debts are soley the obligation of the partnership

6

How can a general partnership become an LLP?

  • all partners must consent to the change in the same manor required for any amendment to the partnership agreement

EXAMPLE:

Wall Street law firm has been practicing for 150 years as a general partnership. Their partnership agreement provides for an amendment by 60% of the partners. When 60% of the partners authorize the filing as an LLP, the firm goes from XYZ Law Firm to XYZ, LLP Here, overnight, the law firm picks up a liability shield without changing its form of business organization.

7

What does the LLP shield protect the partner from?

  • protects a partner only from the partnership liability for another partner's malfeasons or misfeasons
    • does not protect the wrongdoing partner from his personal liablity for his own misdeeds

EXAMPLE:

Z, a partner in XYZ, LLP, commits malpractice to client C. C can sue Z. C can also sue the partnership. Since C can sue XYZ, under general partnership law, X and Y would have therefore now been jointly and severally liable vicariously for Z’s malpractice. By filing their statement of qualification and becoming an LLP, they have severed this vicarious liability.