Management and Control
What are general partner's rights to M&C?
Generally, general partners have equal rights amongst themselves to manage and control the business of the partnership.
Management and Control
What are limited partner's rights to M&C
Generally, limited partners don't have any rights to manage and control the business of the partnership.
Management and Control
Which partners clear up disagreements in regards to ordinary matters connected with the business?
A majority vote of all partners
Management and Control
Under what circumstances may a partner(agent) use partnership property?
i.
ii.
Absent an agreement to the contrary, a partner may only use partnership property:
i. on behalf of the partnership; OR
ii. to carry on the business of the partnership
Management and Control
When can a partner(agent) use partnership property for personal use?
with the consent of all the other partners
Management and Control
Who is entitled to the Books and Records of a partnership?
EVERY partner should have access to Books and Records during business hours, unless the requests become excessive.
Profits and Losses distributions amongst partners?
each partner is generally entitled to an equal share of profits earned by the partnership.
each partner is responsible for losses of the partnership in level proportional to that partner's share of profits
Duty of Care and Loyalty owed by partners(agents)
Each partner owes a limited fiduciary duty of care to the partnership and other partners, which requires the partners(agents) to refrain from: _______________; _________________; _______________--
i. gross or reckless conduct (gambling)
ii. intentional misconduct; AND (sabotage)
iii. knowing violations of the law (wolf of wallstreet)
Duty of Care and Loyalty owed by partners(agents)
What is the type of liability a partner may be subject to if he breaches the fiduciary duty of loyalty?
the partner may be held personally liable
Duty of Care and Loyalty owed by partners(agents)
Each partner owes a fiduciary duty of loyalty to the partnership and other partners, which requires: _____________; ______________
i. act in good faith and fairly to the other partners (play fairly); AND
ii. Account for any property, profit, or benefit derived from the partnership or partnership property. (Keep books of things you take from partnership)
Duty of Care and Loyalty owed by partners(agents)
Each partner owes a fiduciary duty of loyalty to the partnership and other partners, which requires that the partners refrain from: _____________; ______________
i. competing with the partnership within the scope of the business; AND
ii. usurping business opportunities that properly belong to the partnership.
Duty of Care and Loyalty owed by partners(agents)
What type of liability do partners have when they breach the duty of loyalty?
partners may be held personally liable
Duty of Care and Loyalty owed by partners(agents)
is there an exception to a partner who has breached the duty of loyalty from being personally liable?
Yes, a partnership may ELIMINATE a partners personal liability to the partnership for breach of duty of loyalty, if reasonable.
Partners' Fiduciary Duties of Care and Loyalty
SUMMARY
Basically, every partner owes a fiduciary duty of care and a fiduciary duty of loyalty to the other partners and partnership.
Partners owe a duty of care etc. to refrain from gross or reckless misconduct, intentional misconduct, and knowing violations of
Partner Management and Control Responsibilities
Basically, the general partners are responsible for managing and controlling the business affairs and the limited partners have no authority to control the day to day business of the partnership.
However, when a disagreement about the partnership business