General Partners

Corporations Code Title 2, Chapter 4.5, Article 4 deals with general partners under the California Uniform Limited Partnership Act of 2008.

Section 15904.01 provides that a person becomes a general partner in four specified conditions.

Section 15904.02 specifies that each general partner is an agent of the limited partnership for the purposes of its activities. An act of a general partner for apparently carrying on in the ordinary course the limited partnership’s activities or activities of the kind carried on by the limited partnership binds the limited partnership, unless the general partner did not have authority to act for the limited partnership in the particular matter and the person with which the general partner was dealing knew, had received a notification, that the general partner lacked authority.

Section 15904.03 states that a limited partnership is liable for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission, or other actionable conduct, of a general partner acting in the ordinary course of activities of the limited partnership or with authority of the limited partnership.

Section 15904.04 specifies that all general partners are liable jointly and severally for all obligations of the limited partnership unless otherwise agreed by the claimant or provided by law. A person that becomes a general partner of an existing limited partnership is not personally liable for an obligation of a limited partnership incurred before the person became a general partner.

Section 15904.05 allows a general partner to be joined in an action against the limited partnership or named in a separate action. A judgment against a limited partnership is not by itself a judgment against a general partner. A judgment against a limited partnership may not be satisfied from a general partner’s assets unless there is also a judgment against the general partner.

Section 15904.06 states that each general partner has equal rights in the management and conduct of the limited partnership’s activities. Any matter relating to the activities of the limited partnership may be exclusively decided by the general partner or, if there is more than one general partner, by a majority of the general partners. The consent of each partner is necessary to do two specified actions. A limited partnership must reimburse a general partner for specified items.

Section 15904.07 allows a general partner, without having any particular purpose for seeking the information, to inspect and copy during regular business hours two specified items. Each general partner and the limited partnership is required to furnish to a general partner which may be transmitted via electronic transmission in two specified manners.

Section 15904.08 provides that the fiduciary duties that a general partner owes to the limited partnership and the other partners are the duties of loyalty and care. A general partner’s duty of loyalty to the limited partnership and the other partners is limited to the following three specified conditions.

Section 15904.09 explains that a partnership agreement may provide for the creation of classes of general partners. The partnership agreement defines the rights, powers, and duties of those classes including rights, powers, and duties senior to other classes of general partners. The partnership agreement may provide to all or certain specified classes of general partners the right to vote separately or with all or any class of the general partners on any matters.