Interest and Relationship Flashcards
General
Each partner has a transferable interset in the partnership
Characteristics of Interest
Treated as personal property; transferable; attachable
Partner can sell interest without unanimous consent
Right to participate and manage
equal rights
Ordinary business- majority
Outside ordinary- unanimous
Fiduciary Duty
Loyalty- account all profits or benefits; not have adverse dealings; not compete
Care- refrain from engaging in negligent, reckless, unlawful or intentional misconduct
Renumeration
Not right to renumeration for services rendered except for reasonable compensation for services performed while winding up
Indemnification
partnership must indemnify every partner with regard to payments made and obligations incurred
If payment is made in advance beyond contribution- loan and must be repaid with interest
Rights upon dissolution
settlement of accounts
Books
must be kept at executive office; right to inspect
legal action
May sue in own name- to reach partner’s personal assets- must be a judgment against the individual
Partnership may sue partner and vise versa`
