Liabilities of General Partners to Third Parties

Question 1

Agency Principals Apply

Answer 1

Partners are agents of the partnership for apparently carrying on usual partnership business

GP is liable for each partner’s torts in the scope of the partnership business and for each partner’s authorized contracts

Each partner is liable for all debts of partnership and for each co-partner’s torts

Question 2

Incoming partner’s liability for pre-existing debts

Answer 2

incoming partners are generally not liable for prior debts but any $ paid in to partnership can be used to satisfy prior debts

Question 3

Dissociating partner’s liability for subsequent debts

Answer 3

retain liability until:

• actual notice of their dissociation is given to existing creditors
• publication notice is given to known creditors & until publication notice is given to all potential creditors

Question 4

General Partner Liability by Estoppel

Answer 4

One who represents to a third party that a GP exists will be liable as if one did exist