LPs, LLPs, and LLCs

Question 1

LP

Answer 1

Partnership that has at least one general partner and at least one limited partner. A limited partner is liable for the obligations of the partnership up to his capital contribution and general partners are liable as a partner in a general partnership

Question 2

Formation of Limited Partnership

Answer 2

1. File a certificate of formation with secretary of state
2. Identify name of partnership
3. Provide names and addresses of each general partner
4. Maintain records for 3 years

Question 3

Limited Partner Duties

Answer 3

No Right to Act on behalf of partnership and owe no fiduciary duties to the partenrship

Question 4

LP Dissolves

Answer 4

1. At time specified
2. Upon written consent of all GPs and all LPs holding majority interest
3. Upon dissociation of GP unless agreement provides otherwise or new GP appointed within 90 days
4. After 90 days upon dissociation of last LP
5. Upon Judicial Decree

Question 5

LLP

Answer 5

A form of partnership where thee partners are not personally liable for obligations of the partnerships

Question 6

LLP Formation

Answer 6

1. Statement of qualification with secretary of state
2. Identify names and addressed of partners
3. Have partnership name ending in LLP

Question 7

LLP Fiduciary Obligations

Answer 7

Duty of Care
Duty of Loyalty

Question 8

LLC Definition

Answer 8

A business entity that has the limited liability of a corporation combined with the tax advantages of a partnership

Question 9

LLC Formation

Answer 9

1. File articles of Organization
2. Identify name of LLC

Question 10

LLC Management

Answer 10

Can be either member-managed (equal right of members to control and manage –> default) OR manager-managed where manager selected by members and has management control

Question 11

Transferability of LLC Interests

Answer 11

Financial Interests ARE transferable –> member still effectively a member

Management interests are NOT transferrable

Question 12

Liability of LLC Members

Answer 12

Not personally liable beyond own capital contribution unless Court pierces the LLC veil

Question 13

Dissolution of LLC

Answer 13

Traditional Rule: Dissociatoin of any member
Modern Rule: Only by:
1. Event specified
2. Consent of all members
3. 90 days with no members
4. Judicial/Administrative Decree

Question 14

LLC Profits and Losses

Answer 14

-RULLCA follows equal share
-CA Default Rule: Based on contribution``

Question 15

LP Rights and Liability

Answer 15

Limited Partner: no personal liability and no duties owed beyond those specified in general partnership

General Partner: Jointly and Severally liable for all partnership obligations (typical fiduciary duties)
-no violation of duty of loyalty merely from furthering his own interest

Question 16

LLP Liability

Answer 16

Partners are not personally liable for partnership obligations but remain personally liable for own wrongful acts

Question 17

LLC Liability