Property issues

Question 1

Ownership

Answer 1

1. whether property belongs to a partner or partnership

Question 2

Partnership property

Answer 2

1. property is partnership property if:
   i. acquired in the partnership’s name or
   ii. acquired in a partner’s name where it is apparent from the document that the partners is acting for a partnership (ex. document states buyer is a partner)
2. property is presumed to be partnership property if partnership funds are used

Question 3

Partner property

Answer 3

1. property is presumed be a partner’s property if
   i. acquired in her name without partnership funds, and
   ii. there is no sign that acquirer is acting for a partnership

Question 4

Rights in partnership property - partnership use

Answer 4

1. partnership can do whatever it wants with partnership property

Question 5

Partner use

Answer 5

1. a partner is not a co-owner of partnership property
   i. the partnership itself, not the partners, owns partnership property
   ii. partners have no transferrable interest in partnership property
2. partners can use partnership property for partnership purposes
3. partners have no personal interest in partnership property, and can only use it with consent

Question 6

Partner’s ownership interest in the partnership

Answer 6

1. partners are owners of the partnership, and their ownership interest is called a partnership interest
2. a partnership interest includes
   i. management rights:
   a. right to participate in the management of the business
   b. right to obtain information about the partnership
   c. right to be recognized as a partner
   ii. financial rights: right to receive share of profit distributions
3. partners cannot unilaterally transfer management rights
   i. partners cannot transfer management rights and thereby make transferee a partner
   ii. new partners must be admitted by unanimous vote of existing partners
   iii. rules can be modified by partnership agreement
4. partners can unilaterally transfer their financial rights
   i. transferee is not a partner, transferor is still the partner
   ii. transferee merely receives profit distributions that would have gone to the partner
5. vs. corporation: sale of stock transfers ownership and financial rights