/* Here is the full text of the Uniform Partnership Act, together 
with our commentary regarding the same. Unless it is absolutely 
required for tax advantage, avoid partnership at all costs. The 
powers of a rouge partner to bind all of the other partners are 
too scary for words. */

                     UNIFORM PARTNERSHIP ACT

                             PART I

Section 1. Name of Act. This act may be cited as the Uniform 
Partnership Act.

Section 2. Definition of terms. In this Act, "Court" includes 
every court and  judge having jurisdiction in the case.

     "Business" includes every trade, occupation or profession.

     "Bankrupt" includes bankruptcy under the Federal Bankruptcy 
Act or insolvent under any state insolvent act.

     "Conveyance" includes every assignment, lease, mortgage or 
encumbrance.

     "Real property" includes land and any interest or estate in 
land.

Section 3. Interpretation of Knowledge and Notice. (1) A person 
has "knowledge" of a fact within the meaning of this Act not only 
when he has actual knowledge thereof, but also when he has 
knowledge of such other facts as in the circumstances shows bad 
faith.

     (2) A person has "notice" of a fact within the meaning of 
this Act when the person who claims the benefit of the notice:

     (a) States the fact to such person, or 

     (b) Delivers through the mail, or by other manes of 
communication, a written statement of the fact to such person or 
to a proper person at his place of business or residence.

Section 4. Rules of construction. (1) The rule that statutes in 
derogation of the common law are to be strictly construed shall 
have no application under this Act.

     (2) The law of estoppel shall apply under this Act.

     (3) The law of agency shall apply under this Act.

     (4) This Act shall be so interpreted and construed as to 
effect its general purpose to make uniform the law of those 
states which enact it.

     (5) This Act shall not be construed so as to impair the 
obligations of any contract existing when the Act goes into 
effect, nor to affect any action or proceedings begun or right 
accrued before this Act takes effect. 

Section 5. Rules for Cases Not Provided for in this Act. In any 
case not provided for in this Act the rules of law and equity, 
including the law merchant, shall govern.

                             PART II
                     Nature of a partnership

Section 6. Partnership defined. (1) A partnership is an 
association of two or more persons to carry on as co-owners a 
business for profit. 

     (2) But any association formed under any other statute of 
this state, or statute adopted by authority, other than the 
authority of this state, is not a partnership under this act, 
unless such association would have been a partnership in this 
state prior to the adoption of this act; but this act shall apply 
to limited partnerships except in so far as the statutes relating 
to such partnerships are inconsistent herewith.

Section 7. Rules for determining the existence of a partnership. 
In determining whether a partnership exists, these rules shall 
apply:

     (1) Except as provided by section 16 persons who are not 
partners as to each other are not partners as to third persons.

     (2) Joint tenancy, tenancy in common, tenancy by the 
entireties, joint property, common property, or part ownership 
does not of itself establish a partnership, whether such co-
owners do or do not share any profits made by the use of the 
property.

     (3) The sharing of gross returns does not of itself 
establish a partnership, whether or not persons sharing them have 
a joint or common right or interest in any property from which 
the returns are derived.                            

     (4) The receipt by a person of a share of the profits of a 
business is prima facie evidence that he is a partner in the 
business, but no such inference shall be drawn if such profits 
were received in payment:

     (a) As a debt by installments or otherwise;

     (b) As wages of an employee or rent to a landlord;

     (c) As an annuity to a widow or representative of a deceased 
partner;

     (d) As interest on a loan, though the amount of payment 
varies with the profits of the business;

     (e) As the consideration for the sale of a good-will of a 
business or other property by installments or otherwise.

Section 8. Partnership property. (1) All property originally 
brought into the partnership stock or subsequently acquired by 
purchase or otherwise, on account of the partnership, is 
partnership property.

     (2) Unless contrary intent appears, property acquired with 
partnership funds is partnership property.

     (3) Any estate in real property may be acquired in the 
partnership name. Title so acquired can be conveyed only in the 
partnership name.

     (4) A conveyance to a partnership in the partnership name, 
though without words of inheritance, passes the entire estate of 
the grantor unless a contrary intent appears.

                            PART III
  RELATIONS OF PARTNERS TO PERSONS DEALING WITH THE PARTNERSHIP

Section 9. Partner agent of partnership as to Partnership 
Business. (1) Every partner is an agent of the partnership for 
the purpose of its business, and the act of every partner, 
including the execution in the partnership name of any 
instrument, for apparently carrying on in the usual way the 
business of the partnership of which he is a member binds the 
partnership, unless the partner so acting has in fact no 
authority to act for the partnership in the particular matter, 
and the person with whom he is dealing has knowledge of the fact 
that he has no such authority.

     (2) An act of a partner which is not apparently for the 
carrying on of the business of the partnership in the usual way 
does not bind the partnership unless authorized by the other 
partners.

     (3) Unless authorized by the other partners or unless they 
have abandoned the business, one or more but less than all of the 
partners have no authority to:

     (a) Assign the partnership property in trust for creditors 
or on the assignee's promise to pay the debts of the partnership,

     (b) Dispose of the good-will of the business,

     (c) Do any other act which would make it impossible to carry 
on the ordinary business of a partnership,

     (d) Confess a judgment,

     (e) Submit a partnership claim or liability in arbitration 
or reference. 

     (4) No act of a partner in contravention of a restriction on 
authority shall bind the partnership to persons having knowledge 
of the restriction.

Section 10. Conveyance of Real Property of the Partnership. (1) 
where title to real property is in the partnership name, any 
partner may convey title to such property by a conveyance 
executed in the partnership name; but the partnership may recover 
such property unless the partner's act binds the partnership 
under the provisions of paragraph (1) of Section 9 or unless such 
property has been conveyed by the grantee or a person claiming 
through such grantee to a holder for value without knowledge that 
the partner, in making the conveyance, has exceeded his 
authority.

     (2) Where title to real property is in the partnership name, 
a conveyance executed by a partner, in his own name, passes the 
equitable interest of the partnership, provided that the act is 
one within the authority of the partner under the provision of 
paragraph (1) of section 9.

     (3) Where title to real property is in the name of one or 
more but not all the partners, and the record does not disclose 
the right of the partnership, the partners in whose name the 
title stands may convey title to such property, but the 
partnership may recover such property if the partner's act does 
not bud the partnership under the provisions of paragraph (1) of 
section 9, unless the purchaser or his assignee, is a holder for 
value, without knowledge.

     (4) Where the title to real property is in the name of one 
or more or all of the partners, or in a third person in trust for 
the partnership, a conveyance executed by a partner in the 
partnership name, or in his own name, passes the equitable 
interest of the partnership, provided that the act is one within 
the authority of the partner under the provisions of paragraph 
(1) of section 9.

     (5) Where the title to real property is in the name of all 
the partners a conveyance executed by all the partners passes all 
their rights in such property.

Section 11. Partnership Bound by Admission of Partner. An 
admission or representation made by any partner concerning 
partnership affairs within the scope of his authority as 
conferred by this Act is evidence against the partnership.

Section 12. Partnership Charged with Knowledge of or Notice to 
Partner. Notice to any partner of any matter related to 
partnership affairs, and the knowledge of the partner acting in 
the particular matter, acquired while a partner or then present 
in his mind, and the knowledge of any other partner who 
reasonably could and should have communicated it to then acting 
partner, operate as notice to or knowledge of the partnership, 
except in the case of a fraud on the partnership committed by or 
with consent of that partner.

Section 13. Partnership Bound by Partner's Wrongful Act. Where, by 
any wrongful act or omission of any partner acting in the 
ordinary course of the business of the partnership or with the 
authority of his co-partners, loss or injury is caused to any 
person, not being a partner of the partnership, or any penalty is 
incurred, the partnership is liable therefor to the same extent 
as the partner so acting or omitting to act.

Section 14. Partnership Bound by Partner's Breach of Trust. The 
partnership is bound to make good the loss:

     (a) Where one partner acting within the scope of his 
apparent authority receives money or property of a third person 
and misapplies it; and

     (b) Where the partnership in the course of its business 
receives money or property of a third person and the money or 
property so received is misapplied by any  partner while it is in 
the custody of the partnership.

Section 15. Nature of Partner's Liability. All partners are 
liable:

     (a) Jointly and severally for everything chargeable to the 
partnership under sections 13 and 14.

     (b) Jointly for all other debts and obligations of the 
partnership, but any partner may enter into a separate obligation 
to perform a partnership contract.

Section 16. Partner by estoppel. (1) When a person, by words 
spoken or written or by conduct, represents himself, or consents 
to another representing him to any one, as a partner in an 
existing partnership or with one or more persons not actual 
partners, he is liable to any such person to whom such 
representation has been made, who has, on the faith of such 
representation, given credit to the actual or apparent 
partnership, and if he has made such representation or consented 
to its being made in a public manner he is liable to such person, 
whether the representation has or has not been made or 
communicated to such person so giving credit by or with the 
knowledge of the apparent partner making the representation or 
consenting to its being made:

     (a) When a partnership liability results, he is liable as 
though he were an actual member of the partnership.

     (b) When no partnership liability results, he is liable 
jointly with the other persons, if any, so consenting to the 
contract or representation as to incur liability, otherwise 
separately.

     (2) When a person has been thus represented to be a partner 
in an existing partnership, or with one or more persons not 
actual partners, he is an agent of the persons consenting to such 
representation to bind them to the same extent and in the same 
manner as though he was a partner in fact, with respect to 
persons who rely upon the representation. Where all members of 
the existing partnership consent to the representation, a 
partnership act or obligation results; but in all other cases it 
is the joint act or obligation of the person acting and the 
persons consenting to the representation.

Section 17.Liability of Incoming Partner.. A person admitted as a 
partner into an existing partnership is liable for all the 
obligations of the partnership arising before his admission as 
though he had been a partner when such obligations were incurred, 
except that this liability shall be satisfied only out of 
partnership property.

                             PART IV
               RELATION OF PARTNERS TO ONE ANOTHER

Section 18. Rules Determining Rights and Duties of Partners. The 
rights and duties of the partners in relation to the partnership 
shall be determined, subject to any agreement between them, by 
the following rules:

     (a) Each partner shall be repaid his contributions, whether 
by way of capital or advances to the partnership property and 
share equally in the profits and surplus remaining after all 
liabilities, including those to partners, are satisfied; and must 
contribute towards the losses, whether of capital or otherwise, 
sustained by the partnership according to his share of the 
profits.

     (b) The partnership must indemnify every partner in respect 
to payments made and personal liabilities reasonably incurred by 
him in the ordinary and proper conduct of its business, or for 
the preservation of its business or property.

     (c) A partner, who in aid of the partnership makes any 
payment or advance beyond the amount of capital which he agreed 
to contribute, shall be paid interest from the date of the 
payment or advance.

     (d) A partner shall receive interest on the capital 
contributed by him only from the date when repayment should be 
made.

     (e) All partners have equal rights in the management and 
conduct of the partnership business.

     (f) No partner is entitled to remuneration for acting the 
partnership business, except that a surviving partner is entitled 
to reasonable compensation for his services in winding up the 
partnership affairs.

     (g) No person can become a member of the partnership without 
the consent of all the partners.

     (h) Any difference arising as to ordinary matters connected 
with the partnership business may be decided by a majority of the 
partners; but no act in contravention of any agreement between 
the partners may be done rightfully without the consent of all of 
the partners.

Section 19. Partnership Books. The partnership books shall be 
kept, subject to any agreement between the partners, at the 
principal place of business of the partnership, and every partner 
shall at all times have access to and may inspect and copy any of 
them.

Section 20. Duty of Partners to Render Information. Partners 
shall render on demand true and full information of all things 
affecting the partnership to any partner or the legal 
representative of any deceased partner or partner under legal 
disability.

Section 21. Partner Accountable as a Fiduciary. (1) Every partner 
must account to the partnership for any benefit, and shall hold 
as trustee for it any profits derived by him without the consent 
of the other partners from any transaction connected with the 
formation, conduct, or liquidation of the partnership or from any 
used by him of its property.

     (2) This section applies also to the representatives of a 
deceased partner engaged in the liquidation of the affairs of the 
partnership as the personal representatives of the last surviving 
partner. 

Section 22. Right to an Account. Any partner shall have the right 
to a formal account as to partnership affairs:

     (a) If he is wrongfully excluded from the partnership 
business or possession of its property by his co-partners,

     (b) If the right exists under the terms of any agreement,

     (c) As provided by section 21,

     (d) Whenever other circumstances render it just and 
reasonable.

Section 23. Continuation of Partnership Beyond Fixed Term. (1) 
When a partnership for a fixed term or particular undertaking is 
continued after the termination of such term or particular 
undertaking without any express agreement, the rights and duties 
of the partners remain the same as they were at such termination, 
so far as is consistent with partnership at will.

     (2) A continuation of the business by the partners or such 
of them as habitually acted therein during the term, without any 
settlement or liquidation of the partnership affairs, is prima 
facie evidence of a continuation of the partnership.

                             PART V
                  PROPERTY RIGHTS OF A PARTNER 

Section 24. Extent of Property Rights of a Partner. The property 
rights of a partner are (1) his rights in specific partnership 
partnership property, (2) his interest in the partnership, and 
(3) his right to participate in the management.

Section 25. Nature of a Partner's Right in Specific Partnership 
Property. (1) A partner is a co-owner with his partners of 
specific partnership property holding as a tenant in partnership.

     (2) The incidents of this tenancy are such that:

     (a) A partner, subject to the provision of this Act and to 
any agreement between the partners, has an equal right with his 
partners to possess specific partnership property for partnership 
purposes; but he has no right to possess such property for any 
other purpose without the consent of his partners.

     (b) A partner's right in specific partnership property is 
not assignable except in connection with the assignment of rights 
of all partners in the same property.

     (c) A partner's right to specific partnership property is 
not subject to attachment or execution, except on a claim against 
the partnership. 

     (d) On the death of a partner his right in specific 
partnership property vests in the surviving partner or partners, 
except where the deceased was the last surviving partner, when 
his right in such property vests in his legal representative. 
Such surviving partner or partners, or the legal representative 
of the last surviving partner, has no right to possess the 
partnership property for any but a partnership purpose.

     (e) A partner's right in specific partnership property is 
not subject to dower, curtesy, or allowances to widows, heirs or 
next of kin.

Section 26. Nature of Partner's Interest in the Partnership. A 
partner's interest in the partnership is his share of the profits 
and surplus, and the same is personal property.

Section 27. Assignment of Partner's Interest. (1) A conveyance by 
a partner of his interest in the partnership does not of itself 
dissolve the partnership, nor, as against the other partners in 
the absence of agreement, entitle the assignee, during the 
continuance of the partnership to interfere in the management or 
administration of the partnership business or affairs, or to 
require any information or account of partnership transactions, 
or to inspect the partnership books; but it merely entitles the 
assignees to receive in accordance with his contract the profits 
to which the assigning partner would otherwise be entitled.

     (2) In case of a dissolution of the partnership, the 
assignee is entitled to receive his assignor's interest and may 
require an account from the date only of the last account agreed 
to by the partners.

Section 28. Partner's Interest Subject to Charging Order. (1) On 
due application to a competent court by any judgment creditor of 
a partner, the court which entered the judgment, order or decree, 
or any other order of court, may charge the interest of the 
debtor partner with repayment of the unsatisfied amount of such 
judgment debt with interest thereon; and may then or later 
appoint a receiver of his share of the profits, and of any other 
money due or to fall due to him in respect of the partnership, 
and make all other orders, directions, accounts and inquiries 
which the debtor partner might have made, or which the 
circumstances of the case may require.

     (2) The interest charged may be redeemed at any time before 
foreclosure, or in the case of a sale being directed by the court 
may be purchased without thereby causing a dissolution:

     (a) With separate property, by any one or more of the 
partners, or

     (b) With partnership property, by any one or more of the 
partners with the consent of all the partners whose interests are 
not so charged or sold.

     (3) Nothing in this Act shall be held to deprive a partner 
of his right, if any, under the exemption laws, as regards his 
interest in the partnership.

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