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PARTNERSHIP LAW REVIEWERUniversity of the PhilippinesPARTNERSHIP  it is a CONTRACT whereby two or more persons (1) bind themselves to CONTRIBUTE money, property, or industry to a COMMON FUND (2) with the intention of dividing the PROFITS among themselves or in order to EXERCISE a PROFESSION a STAT...

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1 PARTNERSHI PLAW REVI EWER Uni ver si t yoft hePhi l i ppi nes PARTNERSHI P  i ti s a CONTRACT wher eby t wo or mor e per sons ( 1) bi nd t hemsel ves t o CONTRI BUTE money ,pr oper t y ,ori ndust r yt o a COMMON FUND ( 2)wi t ht he i nt ent i on of di vi di ngt hePROFI TS amongt hemsel vesori n or dert oEXERCI SE aPROFESSI ON  a STATUS and a FI DUCI ARY RELATI ON subsi s t i ng bet ween per sons car r yi ngonabusi nessi ncommonwi t havi ew onpr ofit CHARACTERI STI CS OF THE CONTRACT OF PARTNERSHI P [ C,C,L,I ,AS,NP] 1.CONSENSUAL  per f ec t edbymer econsent 2. CONTRI BUTI ON of money , pr oper t y or i ndus t ryt oaCOMMON FUND 3.obj ec tmus tbeaLAWFULone 4. I NTENTI ON of DI VI DI NG t he PROFI T amongt hePARTNERS 5.“ AFFECTI O SOCI ETATI S”  t he desi r et of or mul at e an ACTI VE UNI ON,wi t h peopl eamongwhom t he r e exi st a mut ual CONFI DENCE and TRUSTS 6.NEW PERSONALI TY  t heobj e ctmus tbef orpr ofitand no t mer e l y f or t he c ommon e nj oyme nt ot he r wi seonl yacoowner shi phasbeen f or med. HOWEVER, pecuni ar y pr ofit need notbet heonl yai m,i ti se nough t hati ti st hepr i nc i palpur pose BUSI NESSTRUSTS  when cer t ai n per sons ent r us tt hei r pr oper t yormone yt oot he r swhowi l lmanage t hesamef ort hef or mer RULES ON CAPACI TY TO BECOME A PARTNER 1.a per son capaci t at ed t o ent er i nt o c ont r act ual r e l at i ons may bec ome a par t ner

2.an UNEMANCI PATED MI NOR CANNOT become a par t ne rUNLESS hi s par e nt orguar di anc onsent s 3.a MARRI ED WOMAN, c annot c ont r i but e c onj ugal f unds as her c ont r i but i on t o t he par t ner shi p UNLESS s he i s per mi t t e dt o do so by her husband OR UNLESS she i st he admi ni s t r at or of t he c onj ug al par t ne r s hi p,i n whi c ht heCOURTmus t gi v ei t sc onsentaut hor i t y 4.a PARTNERSHI P bei ng a j ur i di c al per son by i t s el fc an f or m anot her par t ne r s hi p 5.a CORPORATI ON cannot become a par t nerongr oundsofpubl i cpol i cy  a par t ners har es notonl yi n pr ofit s butal s oi nt hel ossesoft hefir m RULE:  t hepar t ne r shi phasaPERSONALI TY SEPARATE and DI STI NCT f r om t hatofeach par t ner

CONSEQUENCES OF THE PARTNERSHI P BEI NG A JURI DI CALENTI TY 1.i t sj ur i di c alper sonal i t yi s SEPARATE and DI STI NCT f r om t hat of each par t ner 2.t hepar t ner s hi pCAN i nGENERAL: A)acqui r e and possess pr oper t y of al lki nds B)i ncurobl i gat i ons C)br i ngci vi landcr i mi nalac t i ons D)can beadj udgedi nsol v entev en i f t hei ndi vi dualmember s beeach financi al l ysol v ent 3.unl e ss he i s gener al l ys ued,a par t ner has no r i ght t o make a separ at e appear anc ei nc our t ,i ft hepar t ner shi p bei ngsue di sal r e adyr e pr e sent ed LI MI TATI ONSON ALI EN PARTNERSHI P 1)i f60% c api t ali snotownedbyFi l i pi nos

PARTNERSHIP LAW- SUMMARY

2  t hefir m cannotac qui r ebypur c hase or ot he r wi se AGRI CULTURAL Phi l i ppi nel ands 2) f or e i gn par t ner shi p may “ l e ase” l ands pr ovi dedt heper i oddoesnotexceed99year s 3) f or e i gn par t ne r shi p may be “ MORTGAGEES”ofl and  per i od of 5 year s ,r enewabl ef or anot her5y ear s  t he y cannot pur c hase i t i n a f or ec l osur esal e RULES I N CASE OF ASSOCI ATI ONS NOT LAWFULLY ORGANI ZED ASPARTNERSHI P 1.i tpossessesNO LEGALPERSONALI TY i tcannotsueassuc hHOWEVER,t he par t ne r si n t he i ri ndi vi dual c apaci t y CAN 2.one who e nt er si nt oac ont r ac twi t ha par t ne r s hi passuc h cannotwhen sued l at eron f orr e cov e r yoft hede bt ,al l ege t hel ac kofl e galper sonal i t yon t hepar t oft he fir m,ev e ni fi ndeed i thad no per sonal i t y  ESTOPPEL  whe t herapar t ne r shi phasaj ur i di c al per sonal i t yornotdependson i t sPERSONAL LAW oft hepar t ne r shi port hel aw oft hepl ace wher et hepar t ne r shi pwasor gani z ed REQUI SI TES FOR EXI STENCE OF PARTNERSHI P[ I ,CF,JI ] 1.I NTENTI ON t oc r eat eapar t ner shi p 2.COMMON FUND obt ai ned f r om c ont r i but i ons 3.JOI NTI NTERESTSi nt hePROFI TS WHAT DO NOT ESTABLI SH A PARTNERSHI P 1.mer ecoowne r shi porcoposs essi on  ev e nwi t hpr ofitshar i ng 2.mer eshar i ngofGROSSr e t ur ns  eve n wi t h j oi nt owne r shi p of t he pr oper t i e si nv ol v ed RULES TO DETERMI NE THE EXI STENCE OF A PARTNERSHI P 1. pe r s onswhoar enotpar t ner st oeac h ot he rar enotpar t ne r sast ot hi r d per sons

EXCEPTI ON:  PARTNERSHI PBYESTOPPEL 2. COOWNERSHI Pofapr oper t ydoesnot i t se l fe s t abl i shapar t ner s hi p,even t hought hecoowne r sshar ei nt he pr ofit sder i v edf r om t hei nci dentofj oi nt owne r shi p 3. SHARI NG OFGROSSRETURNS ALONE doesnoti ndi cat eapar t ne r shi p whe t herornott heper sonsshar i ng t he m hav eaj oi ntorc ommonr i ghtor i nt er es ti nanypr oper t yf r om whi c ht he r e t ur nsar eder i v ed 4. t her ecei ptoft heshar ei nt hepr ofit si s as t r ongpr esumpt i v eevi de nc eof par t ne r shi pHOWEVER,nosuc h i nf er e nc ewi l lbedr awni fsuc hpr ofit s wer er ec ei v edi npayment A)asaDEBTbyi ns t al l ment sor ot he r wi se B)asWAGESofanempl oyee C)asRENTt oal andl or d D)as an ANNUI TY t o a wi dow or r e pr e sent at i v e of a deceased par t ner E)as I NTEREST on a LOAN, t hough t he amountofpayment v ar y wi t h t he pr ofit s of t he busi ne ss F)as t he CONSI DERATI ON f ort he sal e of a GOOD WI LL of a busi ne ss or ot her pr oper t y or ot he r wi se  cr e di t or s ar e not par t ne r s, f or t hei ronl yi nt er es ti nt heshar i ngof pr ofit si st he r ecei ptorpaymentof t hei rc r edi t s  i n apar t ner shi p,t hepar t ne r sar e supposed t o t r us t and hav e c onfidencei nal lt hepar t ner s PARTNERSHI PBY ESTOPPEL  I F 2 per s ons notpar t ner sr e pr e sent t hemsel v es as par t ner s t o st r ange r s, a par t ne r s hi pbyes t oppelr e sul t s  WHEN 2 per sons ,who ar epar t ner s , i n conni vance wi t h af r i e nd who i s nota par t neri nf or m as t r ange rt hatsai df r i e nd i s

PARTNERSHIP LAW- SUMMARY

3 t hei rpar t ner ,a par t ner shi p by e st oppe lal so r e sul tt ot heendt hatt hes t r angershoul dnot bepr e j udi c ed RULE:LAWFULOBJECT orPURPOSE  apar t ne r shi pmus thaveLAWFUL OBJECTorPURPOSE,andmus tbe es t abl i shedf ort hec ommonbenefitori nt er es t oft hepar t ner s i tmus tbewi t hi nt hecommenc eof man,possi bl eandnotc ont r ar yt ol aw,mor al s, goodc us t oms ,publ i cor derorpubl i cpol i cy

 a par t ner shi p c ont r ac t i s NOT CONVERED byt heSTATUTE ofFRAUDS  an AGREEMENT TO FORM par t ne r s hi p does not i t se l f c r eat e par t ne r s hi p

a a

 whe nt her ear ec ondi t i onst o be f ul fil l ed orwhen a cer t ai n per i od i st ol apse , t he par t ner shi pi s notc r eat e dt i l laf t er t he f ul fil l mentoft he condi t i ons ort he ar r i valof t he t er m and t hi si st r ue e v en i fone oft he par t i eshasal r e adyadvanc edhi sagr e edshar e oft hecapi t al

 I F a par t ner shi p has SEVERAL PURPOSES,oneofwhi c hi sUNLAWFUL,t he par t ne r s hi p can s t i l lval i dl ye xi s tso l ong as t hei l l egalpur posecan besepar at e df r om t he l egalpur poses

RULE:i fCAPI TALi sP3, 000ormor e REQUI RED: 1.PUBLI CI NSTRUMENT 2.RECORDED –S. E. C.

 NO need f orJUDI CI AL DECREE t o di s sol v eanunl awf ulpar t ne r shi p  VOI D AB I NI TI O

* FAI LURE TO COMPLY–s hal lnoteffec tt he l i abi l i t yoft hepar t ne r shi pandi t smember st o t hi r dper sons

 oneoft hecausesf ort hedi s sol ut i on ofapar t ner shi pi s“ anyeventwhi c hmakesi t unl awf ulf ort hebusi nessoft hepar t ner shi pt o bec ar r i edon”

* *  I F REAL PROPERTI ES hav e been c ont r i but ed,REGARDLESS oft he VALUE,a publ i c i ns t r ument i s needed f or t he at t ai nmentofl e galper sonal i t y

RULE:  when an UNLAWFUL PARTNERSHI P i s di s sol v ed by a j udi ci aldecr ee,t he PROFI TS shal l be CONFI SCATED i n FAVOR of t he STATE G.R.  a par t ne r shi p may be c ons t i t ut ed i n any f or m EXCEPTI ON: PUBLI CI NSTRUMENT 1.I MMOVABLE PROPERTYi scont r i but ed 2.REALRI GHTSar econt r i but ed * ne ed f or I NVENTORY of I MMOVABLES * * f or EFFECTI VI TY of t he par t ne r s hi p cont r ac t i nsof ar as i nnoc ent t hi r d per sons ar e c onc er ned t he same mus t be REGI STERED i fREALPROPERTI ES ar eI NVOLVED

REQUI REMENTS WHERE I MMOVABLE / REALPROPERTY I SCONTRI BUTED 1. PUBLI CI NSTRUMENT 2. I NVENTORY – si gned and at t ac he dt o t heP. I . * appl i esr e gar dl e ssoft hev al ueoft he r e alpr oper t y * appl i e seve ni fonl yr ealr i ght sov er t her ealpr oper t yar e cont r i but ed * appl i es i fasi def r om r ealpr oper t y , cashorper sonalpr oper t yi s cont r i but ed  TRANSFER ofl andt ot hepar t ner shi pmus t be dul y“ r ecor ded”i nt he ROD t o make t he t r ans f ereffec t i v ei nsof arast hi r d per sonsar e c onc er ned RULE:

PARTNERSHIP LAW- SUMMARY

4  any i mmov abl e pr oper t y or an i nt e r es t t he r ei n maybe acqui r e di nt he par t ne r s hi p name t i t l es oacqui r e dcan beconv eyedonl yi nt he par t ne r s hi pname I Ft he par t ne r shi p has ALI ENS,i tCANNOT OWN LANDS, whe t her publ i c or pr i v at e or whe t he r agr i cul t ur alorcommer ci alEXCEPT t hr oughHEREDI TARYSUCCESSI ON

LI MI TATI ONSON ACQUI SI TI ON 1.AGRI CULTURAL LANDS – 1024 HECTARES 2.l easeofpubl i cl ands( GRAZI NG)–2000 HAS. RULES I F A)ar t i c l e s ar e keptsec r e t amongt hemember s B)anyoneoft hemember smay c ont r ac ti n hi s “ o wn” name wi t ht hi r dper sons 1.NOT a par t ner shi p – NOT a LEGAL PERSON 2.i tmay be s ued by t hi r d pe r s on under t hec ommonnamei tus es 3.i tcannots ue as suc h and cannotbe or di nar i l ybeapar t yt oaci vi lact i on 4.i ns of ar as i nnoc ent t hi r d par t i es ar e c onc er ned  t he par i t i es can be c onsi der ed as member sofapar t ner shi p 5.as be t we en t he mse l v es or i nsof ar as t hi r dper sonsar epr e j udi c ed  onl yt he r ul es ofcoowner shi p mus t appl y EFFECT OFCERTAI N TRANSACTI ONS 1.c ont r act se nt er edi nt obya“ par t ne r ”i n hi sown name may be sue d upon s t i l l by hi m i n hi si ndi vi dualcapaci t y ,not wi t hs t andi ng t he absence of a par t ne r s hi p 2.whe nt woormor ei ndi vi dual s ,havi nga c ommon i nt er es t si n a busi ness br i ng ac our tact i on,i ts houl d be pr e sumed t hatt hey pr os ecut et he same i nt he i r i ndi vi dualcapaci t y as c oowner s and noti n be hal fofa par t ner s hi p whi c h doesnotexi s ti nl egalc ont empl at i on

CLASSI FI CATI ON OF PARTNERSHI PS A)ACCORDI NG TO MANNEROFCREATI ON 1.ORALLYcons t i t ut ed 2.c ons t i t ut ed i n a PRI VATE I NSTRUMENT 3.c ons t i t ut ed i n a PUBLI C I NSTRUMENT 4.REGI STERED –S. E. C. B)ACCORDI NG TO OBJECT 1.UNI VERSAL 2.PARTI CULAR C)ACCORDI NG TO LI ABI LI TY 1.LI MI TED PARTNERSHI P 2.GENERALPARTNERSHI P D)ACCORDI NG TO LEGALI TY 1.LAWFULOR LEGAL 2.UNLAWFULOR I LLEGAL E)ACCORDI NG TO DURATI ON 1.f or a SPECI FI C PEI OD or FI XED PERI OD 2.PARTNERSHI PATWI LL F) ACCORDI NG TO REPRESENTATI ON TO OTHERS 1.ORDI NARYPARTNERSHI P 2.PARTNERSHI PBYETOPPEL G)ASTO LEGALI TYOFEXI STENCE 1.DE JURE PARTNERSHI P 2.DE FACTO PARTNERSHI P H)ASTO PUBLI CI TY 1.SECRETPARTNERSHI P 2.NOTORI OUS/OPEN PARTNERSHI P I )ASTO PURPSE 1.COMMERCI AL/TRADI NG 2.PROFESSI ONAL/NONTRADI NG

GENERALPARTNERSHI P  one wher e al lt he par t ne r s ar e ge ne r al par t ne r s  t heyar eLI ABLE ev en wi t hr es pectt ot hei r i ndi vi dualpr oper t i es ,af t e rt he asse t s oft he par t ne r s hi phasbeene xhaus t e d LI MI TED PATNERSHI P  onewher eatl eas tonepar t neri sa gener al par t nerandt heot he r sar el i mi t edpar t ne r s  onewhosel i abi l i t yi sl i mi t ed onl yupt ot he ext e ntofhi sc ont r i but i on

PARTNERSHIP LAW- SUMMARY

5  a par t ner shi p wher e al lt he par t ner s ar e l i mi t ed par t ner sc annot exi s t as a l i mi t ed par t ner shi p  REFUSED REGI STRATI ON  I Fi tcont i nuous as suc h,i twi l lbe c ons i der ed as a gener alpar t ne r s hi p and al l t he par t ner swi l lbegener alpar t ne r s KI NDSOFUNI VERSALPARTNERSHI P 1.PARTNERSHI P OF ALL PRESENT PROPERTY 2.PARTNERSHI POFALLPROFI TS

* UNI VERSAL PARTNERSHI P OF ALL PRESENT PROPERTY  CONTRI BUTI ON of 1.ALL t he pr oper t i e s ac t ual l y be l ongi ngt ot hepar t ne r s 2.t he PROFI TS acqui r e d wi t h sai d pr oper t y  BECOMESCOMMON PROPERTY  EXCEPTal lFUTURE PROPERTY  FRUI TS ofFUTURE PROPERTY – I NCLUDED I FSTI PULATED UPON

* UNI VERSALPARTNERSHI POFPROFI TS  c ompr i s esal lt hatt hepar t ner smayacqui r e by t he I NDUSTRY orWORK oft he par t ner s becomec ommon pr oper t yr e gar dl essofwi t hi n sai d pr ofit s wer e obt ai ned t hr ough t he us uf r uc tcont r i but ed  EXCEPTPRI ZESandGI FTS RULE:  ar t i c l e s of uni v er salpar t ner s hi p, e nt er e d wi t hout s peci ficat i on of i t s nat ur e , onl y c ons t i t ut eauni v er salpar t ner shi pofPROFI TS RULE:  per sonswhoar epr ohi bi t edf r om gi vi ngeach ot he ranydonat i on oradv ant agecannotent er i nt ouni v er salpar t ne r shi p WHO: 1. HUSBAND andWI FE 2. t hose gui l t y of ADULTERY or CONCUBI NAGE 3. t hose gui l t y of t he same c r i mi nal offense i ft he par t ner shi p was ent er ed i nt oi nc onsi der at i onoft hesame

 whi l es pousescannote nt eri nt oauni v er sal par t ne r s hi p,t hey c an ent eri nt o a par t i cul ar par t ne r s hi porbemember st her eof  a uni v er s al par t ner s hi p i s vi r t ual l y a donat i on t o eac h ot he r of t he par t ne r s pr oper t i e soratl e as tt hei rusuf r uc t

PARTI CULAR PARTNERSHI P  a par t i c ul ar par t ner s hi p has f or i t s OBJECT: 1. DETERNMI NATE THI NGS–t hei rus eor f r ui t s 2. SPECI FI C UNDERTAKI NG 3. EXERCI SE of a PROFESSI ON or VOCATI ON OBLI GATI ONSOF THE PARTNERS RULE:  aPARTNERSHI P BEGI NS f r om t hemoment oft heEXECUTI ON oft heCONTRACT *  even i fcont r i but i ons hav e notye tbeen madet hefir m al r e ady exi st s ,f orpar t ne r shi p i sac onsens ualc ont r ac t DURATI ON OFPARTNERSHI P  UNLI MI TED * MAYBE AGREED UPON 1.EXPRESSLY–defini t eper i od 2.I MPLI EDLY – upon ac hi e vementof i t spur pose PARTNERSHI PAT WI LL  a par t ner s hi p whe r ei n i t s c ont i nued exi st enc er eal l ydependsupon t hewi l loft he par t ne r sorev enont hewi l lofanyoft hem 2KI NDS: 1.whe n t her ei s no t er m, e xpr e ss or i mpl i e d 2.whe ni ti s cont i nue d by t he habi t ual manage r s al t hough t he pe r i od has ended or t he pur pose has been ac compl i shed 3 I MPORTANT DUTI ES OF EVERY PARTNER [ C,DF,W] 1.dut yt o CONTRI BUTE whathad been pr omi sed

PARTNERSHIP LAW- SUMMARY

6 2.dut yt o DELI VER t he FRUI TS ofwhat shoul dhav ebeendel i v er ed 3.dut yt oWARRANT RI ULESON THE DUTY TO CONTRI BUTE 1.t hecont r i but i on mustbe made att he t i me t he par t ner s hi pi s ent er ed i nt o UNLESSadi ffe r entper i odi sst i pul at ed 2.nodemandi sneededt oputt hepar t ner i nde f aul t 3.t hepar t nermus te xe r ci s eduedi l i genc e i n pr e ser vi ng t he pr oper t y t o be c ont r i but ed be f or e he ac t ual l y c ont r i but est hesame 4.apar t nerwhopr omi sest ocont r i but et o t hepar t ne r shi p becomesa pr omi s sor y de bt oroft hepar t ner s hi p RULES ON THE DUTY TO DELI VER THE FRUI TS 1.I F pr oper t y has been pr omi s ed, t he f r ui t st he r eofshoul dal s obegi v en 2.t hef r ui t sr e f e r r ed t o ar et hose ar i s i ng f r om t he t i me t hey shoul d hav e been de l i ver e d, wi t hout a ne ed of any demand 3.I Ft hepar t neri si n BAD FAI TH,he i s l i abl e notonl yf or t he f r ui t s ac t ual l y pr oduced,BUTal sof ort hoset hatc oul d hav ebeenpr oduc ed 4.I F MONEY HAS BEEN PROMI SED, I NTEREST and DAMAGES f r om t he t i mehes houl d havecompl i ed wi t h hi s obl i gat i onshoul dbegi v en 5.NO DEMAND i s ne eded t o put t he par t neri nde f aul t 6.i ti s DELI VERY,ac t ualorc ons t r uc t i ve t hatTRANSFERSOWNERSHI P RULESON THE DUTY TO WARRANT 1. t he war r ant yi n case ofe vi c t i on r e f e r s t o s peci fic and de t er mi nat e t hi ngs al r eadyc ont r i but ed

2. t her ei sEVI CTI ON whe nev erbyafinal j udgmentbased on ar i ghtpr i ort ot he sal eoran ac ti mput abl et ot hepar t ner , t hepar t ner s hi pi sdepr i v edoft hewhol e orapar toft het hi ngpur c hased RULE WHEN CONTRI BUTI ON CONSI STS OF GOODS  APPRAI SAL of VALUE i s needed t o de t e r mi nehow muc hwascont r i but ed HOW APPRAI SALMADE 1. asPRESCRI BED i nt heCONTRACT 2. i n de f aul t ,byEXPERTS c hos en byt he par t ne r s,andatCURRENTPRI CES *  necessi t y oft he I NVENTORY – APPRAI SAL RULE on RI SK ofLOSS  af t ergoods hav e been c ont r i but ed,t he par t ne r s hi p bear st he r i s k ofsubseque nt c hangesi nt heval ue RULE:  a par t ner who has under t aken t o c ont r i but easum ofmoneyand f ai l st odo so becomes a de bt orf ort he i nt er es tand damages f r om t he t i me he shoul d hav e c ompl i e dwi t hhi sobl i g at i on CAPI TALI ST PARTNER  onewhoFURNI SHESCAPI TAL *  NOTEXEMPTED f r om LOSSES *  he can engage i n ot her bus i ness PROVI DED t he r e i s no c ompe t i t i on be t we en t hepar t ne r shi pandhi sbus i ness *  s har ei nt he pr ofit s acc or di ng t o agr e ement s I NDUSTRI ALPARTNER  one who FURNI SHES I NDUSTRY or LABOR *  hei sEXEMPTED f r om LOSSES as be t we en t he par t ner BUT l i abl e t o s t r ange r s wi t hout pr e j udi c e t o r e i mbur sementf r om t hecapi t al i s tpar t ne r *  he CANNOT engage i n any ot her BUSI NESS WI THOUT t he expr ess CONSENT of t he ot he r par t ner s, OTHERWI SE 1.hecanbeEXCLUDED f r om t hefir m -pl usdamage s OR

PARTNERSHIP LAW- SUMMARY

7 2.t he BENEFI TS he obt ai ns f r om t he ot he rbusi ne sses CAN BE AVAI LED of byt heot herpar t ne r s - pl usdamages  whe t her or not t he r e i s COMPETI TI ON * i ncomput i ngal waysl ookf or NET PROFI TS  NET LOSSES

 one who i s notr eal l y a par t nerBUT who may bec ome l i abl e as suc hi ns of ar as t hi r d per sonsar econc er ned

CAPI TALI ST –I NDUSTRI ALI ST PARTNER  one who c ont r i but es BOTH CAPI TAL and I NDUSTRY

*  i nt heabsenceofpr oof ,t hes har esar e pr esumedt obeequal

GENERALPARTNER  onewhoi sl i abl e“ beyond”t heext entofhi s c ont r i but i on LI MI TED PARTNER  onewhoi sl i abl e“ onl y”t ot hee xt entofhi s c ont r i but i on * * *  an i ndust r i al par t ner can onl y be a gener alpar t ne r ,nev eral i mi t edpar t ner MANAGI NG PARTNER  onewhomanagesac t i v e l yt hefir msaffai r s SI LENT PARTNER  one who does not par t i c i pat e i n t he manage ment , t hough he s har es i n t he PROFI TSorLOSSES LI QUI DATI NG PARTNER  onewhowi ndsuporl i qui dat est heaffai r sof t hefir m af t eri thasbeendi ssol ved OSTENSI BLE PARTNER  onewhosec onne c t i onwi t ht hefir mi spubl i c andopen SECRET PARTNER  one whose connect i on wi t h t he fir m i s c onc eal e dorkeptsecr e t DORMANT PARTNER  onewhoi sbot h asecr e t( hi dden)andsi l e nt ( notmanagi ng)par t ner NOMI NALPARTNER

RULE:  par t ner s shal l CONTRI BUTE EQUAL SHARESt ot hecapi t aloft hepar t ner shi p * i ti sper mi ssi bl et ocont r i but eUNEQUAL SHARESI Ft her ei sas t i pul at i ont ot hi seffec t

CONDI TI ONS bef or ea capi t al i stpar t neri s obl i ged t o sel lhi sshar es /i nt er estt ot he ot herpar t ners[ I L,RC,NA] 1.i ft her ei sI MMI NENT LOSS of t he BUSI NESSoft hepar t ne r shi p 2.he REFUSES t o CONTRI BUTE an ADDI TI ONALSHARE t ot heCAPI TAL 3.t he r ei snoagr e ementt ot hecont r ar y * I NDUSTRI ALPARTNER I SEXEMPTED

* RULE i fMANAGI NG PARTNER COLLECTS A CREDI T REQUI SI TES: 1.e xi s t e nc e of at l e as t 2 de bt s  PARTNERSHI P  PARTNER 2.bot hsumsar edemandabl e 3.t hec ol l ect i ng par t neri st he managi ng par t ner *  t hesum t husc ol l ect e d shal lbeappl i ed t ot het wocr edi t si n pr opor t i ont ot hei ramount s RULE: *  wher e a par t nerr ec ei v es hi s shar ei nt he par t ner sh...